Market News from FxPro

[FxproNews11]

Market picture​

According to Alex Kuptsikevich, a senior analyst of FxPro, Bitcoin rose 5.8% over the past week to near $24.3K. Ethereum jumped 14.3% to $1970. Top altcoins showed a less consistent performance, ranging from -2.3% (BNB) to +12.8% (DogeCoin) over the previous seven days.



The total crypto market capitalisation increased by 5.7% over the week to $1.18 trillion, according to CoinMarketCap. The Bitcoin dominance index fell by 0.5 points to 40.2%. The cryptocurrency Fear and Greed Index rose to 45 by Monday versus 30 a week earlier and is now on the verge of transitioning from 'fear' into 'neutral' territory.



Bitcoin maintains upward momentum with steady but slight gains above previous local highs. Since Thursday, BTCUSD has sold off on repeated attempts to climb above $25K. In illiquid trading on Monday morning, the price managed to climb higher but is now pulling back to $24.5K. Despite the futility of the bulls' attempts to warm up the price, the sellers' overhang remains strong.



Ether has recently been above the market but selling off near $2000 since late last week. Investors, many of whom are retail traders and putting a higher value on the round numbers, are taking profits from the rally that has doubled the price since July.

News background​

The EthereumPoW project (ETHPow) reported codebase readiness and broad support for the future fork of the Ethereum network from miners, hardware manufacturers and the crypto community. Ethereum's transition to PoS will occur on 15 or 16 September, 3-4 days earlier than the estimated date. According to Santiment, crypto whales and institutions are buying ETH ahead of the September upgrade.




The creators of the anonymous cryptocurrency, Monero, carried out another network hardfork, reducing block size and increasing transaction speed and confidentiality.

Cybersecurity company Netskope warned digital asset owners of increasing phishing attacks using Google Sites and Microsoft Azure SEO tools.

 

[FxproNews11]

Market picture

According to Alex Kuptsikevich, a senior analyst of FxPro, Bitcoin is losing 3.7% in the past 24 hours, falling to $23.9K%. Ethereum is down 5.2% to $1870. Other top altcoins are down 2% (BNB) to 6.4% (Solana).

The total capitalisation of the crypto market, according to CoinMarketCap, fell 3.6% to $1.14 trillion overnight.



Bitcoin on Monday failed to claw its way above $25K, after which short-term buyers rushed to lock in profits and returned the price to the $24K area. The pressure on BTC was exerted by the rising US dollar amid weak data from China, indicating a slowdown in the economy.



However, so far, Bitcoin's decline is more appropriately seen as a corrective pullback within an uptrend. It would only be appropriate to discuss a break in this trend if it moves below $22.5K-23.0K. Sluggish and uncertain growth at the first stages is typical after a strong sell-off that prevailed since last October.



News background

Notably, the positive dynamics of the crypto market last week coincided with a net $17 million outflow, the first net withdrawal in seven weeks, of which $21 million came from investments in BTC. At the same time, investments in bitcoin short funds increased by $2.6 million.

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[FxproNews11]

According to Alex Kuptsikevich, a senior analyst of FxPro,
Oil experienced intense pressure on Monday, but the price of natural gas continued its upward trend. This contrast is due to an under-supply of Russian gas to the European market and more speculation around Iranian oil, which could quickly add more than 1m BPD. That said, macroeconomics is now on the side of the energy bears, with only geopolitics temporarily feeding the bulls.

Gas prices in New York are approaching $9 per million British thermal units (1M BTU). This is the area of the May-June highs. A steadily higher price was last seen in 2008. But these high prices have little to do with what Europe now faces.



Gas prices in Europe have surpassed $2,500 per 1,000 cubic metres, the highest since March 8. Europe and America are different markets, and it is not correct to compare prices directly. For example, converted to US standards, current prices at the Dutch hub are close to $70 per 1M BTU. That is 7.8 times higher than in New York. By comparison, in mid-2018, when there was a lull in this market, the difference was 2.6 times.



It is logical to expect that the price difference between Europe and the USA will narrow on both sides, which implies an increase in the USA and a decrease in Europe. But it is worth looking at the first and easiest substitute for gas - crude oil.



Europe is working hard to increase the world's oil supply, with efforts to conclude the Iran nuclear deal. Yesterday's news on the subject sent Brent nearly 5% down to $92.2 and WTI to $86.30, its lowest level since the end of February, reflecting a market surplus.



The downtrend in oil prices, which has lasted for more than two months, suggests that right now, we may be witnessing nothing more than a speculative attack on gas, inflating a bubble in its final stages. Experience suggests that in such cases, we see a sharp acceleration before the bubble bursts with a bang. With the Gas case, we should be prepared for prices in Europe to surpass $3000 and in the US to break through $10 before the final downward reversal.

 

[FxproNews11]

According to Alex Kuptsikevich, a senior analyst of FxPro, Bitcoin has added 1.5% to $24.3K in the past 24 hours. Over the past couple of hours, the first cryptocurrency has regained Tuesday's slump, finding support from buyers at last Friday's local lows.

Ethereum, following trends in recent weeks, is returning the drawdown even more vividly, adding 3.3% overnight to $1940. Top altcoins are rising between 1.7% (BNB) and 11.3% (Dogecoin).



The total capitalisation of the crypto market, according to CoinMarketCap, rose 2% to $1.16 trillion overnight.



Gold and silver crypto are firmly in an uptrend corridor, turning to rise today before touching the lower boundary.

Dogecoin was the highest gainer in the top 100 crypto-assets, adding around 30% for the week. Another dog coin, Shiba Inu, is also growing. The community has already managed to call it a dog race. In both cases, it is a manifestation of retail investor activity, similar to the run-up in meme stocks that is happening again in the stock markets.



News background

According to Arcane Research, miners have been selling more BTC than mining for three consecutive months since May. While bitcoin's rise in July has eased the pressure on miners, they continue to sell off previously accumulated stockpiles.



PayPal, the largest electronic payment system, has added the ability to buy, sell and transfer cryptocurrencies via a mobile app. One of Brazil's largest banks, BTG Pactual, has launched a platform for investing in cryptocurrencies.



The US Federal Reserve is issuing new rules for cryptocurrency banks, under which they can be granted master accounts, a key financial status, allows direct payments and access to the regulator.



The European Union authorities will create a new regulatory authority, AMLA, to directly oversee the industry.

 

[FxproNews11]

According to Alex Kuptsikevich, a senior analyst of FxPro, While economists in the US and Canada, and later policymakers, are talking about peak inflation, that moment is yet to come for the UK. Annual inflation has reached double-digit territory at 10.1%. At the same time, the monthly price growth rate remains elevated.



It is also important to note the spread of inflation beyond energy. The core CPI has accelerated from 5.8% to 6.2%, higher than the expected 5.9%, indicating an active consumer cost pass-through.



Retailers are finding it difficult to avoid as manufacturers raised their selling prices by 1.6% over July and have increased by 17.1% over the past 12 months.



However, one of the leading inflation indicators - the Input Producer Price Index - indicated light at the end of the tunnel. This indicator rose by only 0.1% in July, sharply below the forecasted 0.7%. The annual rate slowed down from 24.1% to 22.6%.



This cooling of the early price indicator further fuels confidence in the Bank of England's forecasts that consumer inflation will peak in November and levels near 11%.



It is difficult for the Bank of England to maintain the same rate hikes as the Fed due to a less bright labour market picture, which thickens the cloud over the economic outlook. As a result, the British pound is under additional pressure, losing more than 12.5% to the dollar.



Historically, due to higher inflation in the UK compared to the US, GBPUSD has been dominated by a downtrend. Currently, the pair is testing the area near 1.20 for the fourth time in modern history. The difference in monetary policy potential and actual inflation data are set up that the GBPUSD will finally dip into lower territory in the coming weeks.



There is a considerable risk that, unlike the episodes of the last six years, this time, investors will not rush to buy the pound but will sell it out, repeating the 1984 dynamic. Having settled at 1.20 in November of that year, the pound plummeted to 1.05 in the next four months, and only Plaza Accord reversed the trend. But the big question now is whether the US need a new such accord.

 

[sebking1986]

I think ETH is at a point where we can start looking towards bullishness, particularly if it breaks above the level it is now. BTC has a while to go to the 28k-32k level.

 

[ForexTus]

I think ETH is at a point where we can start looking towards bullishness, particularly if it breaks above the level it is now. BTC has a while to go to the 28k-32k level.

Me too, im looking at ETH now then BTC later in the year

 

[sebking1986]

The merge date being confirmed for next month is massively bullish for ETH and in my opinion will start to tip the balance of dominance finally.

 

[FxproNews11]

Market picture

According to Alex Kuptsikevich, a senior analyst of FxPro, Bitcoin has lost 4% in the past 24 hours, falling to $23.3K. Ethereum lost 5.3% to $1840. Top altcoins are down 3% (XRP) to 8% (Solana).



Total crypto market capitalisation, according to CoinMarketCap, sank 3.4% to $1.12 trillion. The Crypto Fear and Greed Index fell 11 points to 30 by Thursday, tumbling deeper into "fear" territory.

Once again, Bitcoin seems to have acted as a leading indicator of risk sentiment in global markets. The former cryptocurrency had been sluggishly correcting over the previous three days but only yesterday took a decisive step down, warning of a similar move in the US indices.



Right now, BTCUSD has rolled back to the area of previous local lows and is approaching the lower boundary of the uptrend channel. A break below $22.5K in a sharp move down would be evidence of a gap in the last two months' trend and a deeper dive harbinger.



News background

According to Fox Business journalist Eleanor Terrett, the US Securities and Exchange Commission (SEC) may yet charge Ethereum creators with selling unregistered securities in the US.

Cryptocurrency hacking damage in 2022 was $1.9 billion, having doubled in a year and a half, according to analytics service Chainalysis.



The European Green Party has introduced legislative amendments to increase capital requirements for banks using cryptocurrencies.



Stablecoins backed by the US dollar, and other fiat currencies will expand access to financial services and Web3, according to cryptocurrency exchange Coinbase.

According to Blockckdata, Alphabet, Google's parent company, has invested more than $1.5bn in four blockchain companies between September 2021 and June 2022. This is followed by Blackrock ($1.17bn) and Morgan Stanley ($1.11bn). Overall, large public companies have invested about $6 billion in crypto over this period.

 

[FxproNews11]

According to Alex Kuptsikevich, a senior analyst of FxPro, the US dollar slowly added for the third trading session, returning to levels of three weeks ago. While the published FOMC meeting minutes did not cause a sharp reaction, the FX dynamics of the past week are more indicative of the end of a corrective pullback. And we would not be surprised if the Dollar's growth will shift to the next gear in the coming days.



The market's primary focus has been whether there will be a 75-point rate hike next. These expectations have changed little since the futures market, as has been the case for the last week or so, is laying down a roughly 40% chance of a third consecutive such move.



However, the central bank officials are concerned that the inflation threat could quickly return if policy tightening does not suppress expectations. So, the FOMC is in the mood to press the monetary brake pedal more firmly than the market expects. This is now roughly the same signal Powell sent in autumn 2018, resulting in a violent sell-off in the equity market.

It seems that markets are setting expectations for a lower final rate hike than the Fed. The FOMC has been using more and more channels lately to explain its view, from comments from committee members and minutes to explanatory articles in the WSJ.



It is well visible that the currency market has been taking note of these signals for at least a week now, although investors continued to push stocks up until yesterday. The currency market often goes half a step ahead of stocks, so we see the reversal of the Dollar Index to growth over the last ten days as the end of a corrective decline and the start of a new wave of dollar strength.

Apart from the Fed, there are also several fundamental factors on the Dollar's side right now, from slowing retail sales and a collapse in the housing market to strong demand for LNG, which the US exports to Europe. These factors are reducing pressure on the Dollar through the trade balance.



At the same time, money markets are paying increasing attention to rising bond yields in the US. While the two-year US bonds most sensitive to Fed policy are trading at with 3.2% yield, compared to similar Chinese bonds at just 2.07% and German as low as 0.75%. This disposition attracts buyers to dollar securities, which further support its exchange rate.

The Dollar Index has managed to quickly return above its 50-day moving average, maintaining it as support for over a year. If we are right, the Dollar could soon reach a retest of the July highs, when the DXY was above 109, and the EURUSD was down to 1.0. And with a new retest, we should expect dollar buyers to be able to push it to renew multi-year highs unless the macroeconomic situation changes drastically.