The crypto market has been trading around 1.08 trillion over the last day.
The trading range is narrowing as the Fed decision approaches. However, it is worth highlighting the pressure on the markets early on Wednesday and the intensification of cryptocurrency selling as the cap rises towards 1.09 trillion.
Bitcoin encountered resistance at $27.4K. Attempts to break above the 50-day moving average for the third day met strong resistance. All financial markets have taken a wait-and-see approach ahead of monetary policy decisions in the US, Switzerland, the UK, and Japan.
The situation for Bitcoin is bearish if one looks solely at the technical picture on the chart. The corrective bounce in BTC is formally over; the price has fallen below the moving averages, and the short-term oversold condition is complete.
In another recalculation, bitcoin's mining difficulty rose 5.48% to 57.12 T. According to Glassnode, the smoothed 7-day moving average hit a high of 423.4 EH/s.
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The trading range is narrowing as the Fed decision approaches. However, it is worth highlighting the pressure on the markets early on Wednesday and the intensification of cryptocurrency selling as the cap rises towards 1.09 trillion.
Bitcoin encountered resistance at $27.4K. Attempts to break above the 50-day moving average for the third day met strong resistance. All financial markets have taken a wait-and-see approach ahead of monetary policy decisions in the US, Switzerland, the UK, and Japan.
The situation for Bitcoin is bearish if one looks solely at the technical picture on the chart. The corrective bounce in BTC is formally over; the price has fallen below the moving averages, and the short-term oversold condition is complete.
In another recalculation, bitcoin's mining difficulty rose 5.48% to 57.12 T. According to Glassnode, the smoothed 7-day moving average hit a high of 423.4 EH/s.
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UK consumer inflation slowed from 6.8% to 6.7% y/y, contrary to the expected acceleration to 7.0%. Core inflation, excluding food and energy, saw an even more significant slowdown of 6.2% from 6.9% y/y, well below the average forecast of 6.8%.
The weaker-than-expected data sparked a brief sell-off in GBPUSD, with the exchange rate dropping nearly 0.5% within minutes to 1.2330, a level last seen in May.
The UK's annual price growth rate is still higher than other developed economies, outpacing several major emerging ones. The latest data has fuelled speculation that the Bank of England will pause on rate hikes or even end the hiking cycle that began almost two years ago.
The weaker-than-expected data sparked a brief sell-off in GBPUSD, with the exchange rate dropping nearly 0.5% within minutes to 1.2330, a level last seen in May.
The UK's annual price growth rate is still higher than other developed economies, outpacing several major emerging ones. The latest data has fuelled speculation that the Bank of England will pause on rate hikes or even end the hiking cycle that began almost two years ago.
The dovish rhetoric looks premature in our view. These 9.1% y/y retail price increases are unacceptable for a developed country, and core inflation has been "too high for too long", entrenching inflation expectations. A strong labour market increases the risk of secondary inflationary effects, exacerbated by the recent rise in commodity and energy prices.
Producer input prices rose by 0.4% in August. Producer output prices have risen by 0.2% over the past two months, signalling the end of the deflationary impact on final inflation.
For over two months now, the Pound has been gently retreating against the Dollar because of contrasting economic data from these countries, with the UK being the weaker side. However, it would be a mistake to assume that the Bank of England will quickly turn its monetary policy towards easing, as this could increase pressure on Sterling and reinforce pro-inflationary factors.
Producer input prices rose by 0.4% in August. Producer output prices have risen by 0.2% over the past two months, signalling the end of the deflationary impact on final inflation.
For over two months now, the Pound has been gently retreating against the Dollar because of contrasting economic data from these countries, with the UK being the weaker side. However, it would be a mistake to assume that the Bank of England will quickly turn its monetary policy towards easing, as this could increase pressure on Sterling and reinforce pro-inflationary factors.
#WaveAnalysis
#USDJPY broke the resistance level 147,40
Likely to rise to resistance level 147.70
USDJPY currency pair recently broke the resistance level 147,40 (which has been reversing the price from the start of September).
The breakout of the resistance level 147,40 accelerated the active impulse wave 5 of the intermediate impulse wave (3) from the middle of July.
Given the clear daily uptrend, USDJPY currency pair can be expected to rise further toward the next resistance level 147.70.
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#USDJPY broke the resistance level 147,40
Likely to rise to resistance level 147.70
USDJPY currency pair recently broke the resistance level 147,40 (which has been reversing the price from the start of September).
The breakout of the resistance level 147,40 accelerated the active impulse wave 5 of the intermediate impulse wave (3) from the middle of July.
Given the clear daily uptrend, USDJPY currency pair can be expected to rise further toward the next resistance level 147.70.
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#WaveAnalysis
#Gold rising inside minor impulse wave 1
Likely to reach resistance at 1985.00
Gold continues to rise inside the minor impulse wave 1, which reversed earlier from the upper trendline of the recently broken down channel from May.
The active impulse wave 1 belongs to the intermediate impulse wave (1) from the end of August.
Given the strong daily uptrend, Gold can be expected to break the next resistance at 1950.00 and to rise further toward the next resistance level 1985.00.
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#Gold rising inside minor impulse wave 1
Likely to reach resistance at 1985.00
Gold continues to rise inside the minor impulse wave 1, which reversed earlier from the upper trendline of the recently broken down channel from May.
The active impulse wave 1 belongs to the intermediate impulse wave (1) from the end of August.
Given the strong daily uptrend, Gold can be expected to break the next resistance at 1950.00 and to rise further toward the next resistance level 1985.00.
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Even the Fed's decision and comments failed to inspire crypto investors. The market cap fell a modest 0.25% on the day, significantly less than the Nasdaq's losses (-1.5%) and more a reflection of the dollar's 0.3% appreciation over the period.
In #Bitcoin, the sell-off intensifies around the 50-day moving average, sticking to a downtrend. The curve is near $27.0K but has been pointing down since early August, coinciding with the start of the latest bearish momentum.
On the other hand, with a dip towards $26.8K, Bitcoin is once again being dominated by buying. This tug-of-war won't last long. Most likely, the market will decide its direction before Friday. We still believe that the chances of further declines are higher for now.
Long-term BTC holders are accumulating the coins they sold to short-term investors in the spring, which promises positive prospects for the future. This is the kind of behaviour hoarders exhibit at the beginning of bull markets, Bitfinex noted.
In #Bitcoin, the sell-off intensifies around the 50-day moving average, sticking to a downtrend. The curve is near $27.0K but has been pointing down since early August, coinciding with the start of the latest bearish momentum.
On the other hand, with a dip towards $26.8K, Bitcoin is once again being dominated by buying. This tug-of-war won't last long. Most likely, the market will decide its direction before Friday. We still believe that the chances of further declines are higher for now.
Long-term BTC holders are accumulating the coins they sold to short-term investors in the spring, which promises positive prospects for the future. This is the kind of behaviour hoarders exhibit at the beginning of bull markets, Bitfinex noted.
Franc weakens as SNB's logical move surprises markets
The Swiss National Bank left its key interest rate unchanged at 1.75%. On average, markets had been predicting a 25-basis point hike, contrary to our expectations.
Most likely, market participants' forecasts were influenced by the ECB rate hike a week earlier. In addition, policy tightening expected in Sweden and Norway indeed took place. But there are a couple of things that set Switzerland apart from other European countries.
The Swiss National Bank left its key interest rate unchanged at 1.75%. On average, markets had been predicting a 25-basis point hike, contrary to our expectations.
Most likely, market participants' forecasts were influenced by the ECB rate hike a week earlier. In addition, policy tightening expected in Sweden and Norway indeed took place. But there are a couple of things that set Switzerland apart from other European countries.
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First is inflation. The annual rate of price increases has been below 2% for the past three months, and this is not a high-base effect. Monthly price increases have averaged 0.09% over the past six months and half that over the past three months, bringing annual inflation to 1.1% and 0.55%, respectively.
Second is the Swiss franc exchange rate. In July, the USDCHF fell to 0.8550. It was briefly lower in 2015 and from May to September 2011. By comparison, the yen - another example of a safe haven - is testing multi-month lows. Neither the euro nor the pound can boast high levels relative to historical prospects.
Second is the Swiss franc exchange rate. In July, the USDCHF fell to 0.8550. It was briefly lower in 2015 and from May to September 2011. By comparison, the yen - another example of a safe haven - is testing multi-month lows. Neither the euro nor the pound can boast high levels relative to historical prospects.
The Swiss franc lost 1.5% against the dollar in response to the Fed's hawkish pause and a "surprise" from the SNB. The USDCHF pair has risen above 0.9050, its highest level in over three months, after moving slowly but smoothly upwards for the past two months.
If the pair holds these levels for the rest of the day, or even better, for the rest of the week, we will have signalled a change in the long-term trend, as the USDCHF has crossed the 200-day moving average.
However, we should expect a severe fight at current levels as the pair looks overbought. The pair's upward momentum on Thursday could be the last mile before broad profit-taking begins on the previous gains.
The Franc has likely run out of fuel for further declines. A corrective pullback to 0.9850-0.9000 may be needed to make selling the Franc attractive again in the medium term. On the bearish side, risk aversion in global markets could return in the coming days if it leads to deleveraging.
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If the pair holds these levels for the rest of the day, or even better, for the rest of the week, we will have signalled a change in the long-term trend, as the USDCHF has crossed the 200-day moving average.
However, we should expect a severe fight at current levels as the pair looks overbought. The pair's upward momentum on Thursday could be the last mile before broad profit-taking begins on the previous gains.
The Franc has likely run out of fuel for further declines. A corrective pullback to 0.9850-0.9000 may be needed to make selling the Franc attractive again in the medium term. On the bearish side, risk aversion in global markets could return in the coming days if it leads to deleveraging.
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#WaveAnalysis
#CHFJPY broke support level 164.00
Likely to fall to support level 162.00
CHFJPY continues to fall inside the minor impulse wave i, which previously broke the support level 164.00 (low of the previous wave A) intersecting with the 38.2% Fibonacci correction of the upward impulse from July.
The breakout of the support level 164.00 should accelerate the active impulse wave i, which belongs to the C-wave of the intermediate ABC wave (4) from the end of August.
CHFJPY can be expected to fall further toward the next support level 162.00 (low of the previous correction ii from August).
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#CHFJPY broke support level 164.00
Likely to fall to support level 162.00
CHFJPY continues to fall inside the minor impulse wave i, which previously broke the support level 164.00 (low of the previous wave A) intersecting with the 38.2% Fibonacci correction of the upward impulse from July.
The breakout of the support level 164.00 should accelerate the active impulse wave i, which belongs to the C-wave of the intermediate ABC wave (4) from the end of August.
CHFJPY can be expected to fall further toward the next support level 162.00 (low of the previous correction ii from August).
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#WaveAnalysis
#USDCHF broke resistance level 0.9000
Likely to rise to resistance level 0.9150
USDCHF recently broke above the round resistance level 0.9000 (which has been reversing the price from June) intersecting with the 50% Fibonacci correction of the downtrend from March.
The breakout of the resistance level 0.9000 should accelerate the active impulse wave c, which belongs to the ABC correction 2 from July.
USDCHF can be expected to rise further toward the next resistance level 0.9150 (target for the completion of the active impulse wave c).
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#USDCHF broke resistance level 0.9000
Likely to rise to resistance level 0.9150
USDCHF recently broke above the round resistance level 0.9000 (which has been reversing the price from June) intersecting with the 50% Fibonacci correction of the downtrend from March.
The breakout of the resistance level 0.9000 should accelerate the active impulse wave c, which belongs to the ABC correction 2 from July.
USDCHF can be expected to rise further toward the next resistance level 0.9150 (target for the completion of the active impulse wave c).
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The crypto market cap has fallen to $1.056 trillion, losing around 0.9% in 24 hours. The main pressure on the market came from outside, with the US market losing a further 1.8% on the Nasdaq, returning to August lows. It should be noted that against such an unfavourable external backdrop, the consolidation of cryptocurrencies near the levels seen at the beginning of the week looks like a vote of confidence from crypto enthusiasts.
#Bitcoin has returned to $26.6, erasing the mini pump at the beginning of the week. The ability to hold on to last week's support looks like a positive signal. On the other hand, we saw earlier this week that bears control the market. But they aren't in a hurry yet.
#Ethereum looks weak. After five weeks of trying to stay above its 50- and 200-week moving averages, the digital silver is in danger of closing below these lines and $1600 this week. The following lines of defence look to be the $1500 and $1200, where buyers came to the coin's rescue in March and December 2022.
#Bitcoin has returned to $26.6, erasing the mini pump at the beginning of the week. The ability to hold on to last week's support looks like a positive signal. On the other hand, we saw earlier this week that bears control the market. But they aren't in a hurry yet.
#Ethereum looks weak. After five weeks of trying to stay above its 50- and 200-week moving averages, the digital silver is in danger of closing below these lines and $1600 this week. The following lines of defence look to be the $1500 and $1200, where buyers came to the coin's rescue in March and December 2022.
Nasdaq-100 and S&P 500 are on the verge of a deeper correction
The US stock market is attempting to bounce back on Friday after the heavy sell-off on Wednesday and Thursday. The Nasdaq-100 index was close to key levels where it reversed gains made in June and August. The S&P 500 has fallen below similar support, which is worrying.
Nasdaq-100 futures fell below 14700 on Friday morning. Previously, on 26 June and 18 August, this area supported a reversal to the upside. But in that time, the situation has deteriorated. In June, there was a brief pause on the way up. It was a desperate attempt in August to hold onto the uptrend, followed by a long battle for the 50-day moving average.
The bearish team showed its strength in the second half of September when it first pushed the index below this medium-term trend indicator in a strong move and then pushed the Nasdaq-100 4% away from this line after the Fed meeting. In addition, the 50-day MA reversed to the downside for the first time since early January.
The US stock market is attempting to bounce back on Friday after the heavy sell-off on Wednesday and Thursday. The Nasdaq-100 index was close to key levels where it reversed gains made in June and August. The S&P 500 has fallen below similar support, which is worrying.
Nasdaq-100 futures fell below 14700 on Friday morning. Previously, on 26 June and 18 August, this area supported a reversal to the upside. But in that time, the situation has deteriorated. In June, there was a brief pause on the way up. It was a desperate attempt in August to hold onto the uptrend, followed by a long battle for the 50-day moving average.
The bearish team showed its strength in the second half of September when it first pushed the index below this medium-term trend indicator in a strong move and then pushed the Nasdaq-100 4% away from this line after the Fed meeting. In addition, the 50-day MA reversed to the downside for the first time since early January.
As is often the case on Friday, we will see some short-term profit-taking that may raise false hopes. A consolidation below 14700 early next week will set the stage for a deeper correction. Potential targets are 13930, where 61.8% of the rally since the beginning of the year has taken place. Or the 200-day average, now near 13600 but pointing higher, will reach 13900 around mid-October.
The alternative scenario suggests that stocks will continue to find support not only on Friday but into the new week, forming a triple bottom and potentially completing a corrective pullback to 76.4% of the year-to-date rally.
The alternative scenario suggests that stocks will continue to find support not only on Friday but into the new week, forming a triple bottom and potentially completing a corrective pullback to 76.4% of the year-to-date rally.
The S&P 500 is in a more difficult position, as Thursday's trading saw the index close below the pivot points from August and the second half of June and below the 76.4% line of all gains since last October. A classic 61.8% Fibonacci retracement of the previous 12 months' rally would suggest a decline to the 4200 area, the 200-day moving average and a former major resistance area from May 2022 to June 2023.
Even if these correction targets for the Nasdaq-100 and S&P 500 are fully met, we will still be in a bull market. At the same time, there is a chance that the monetary authorities will be more cautious in their comments on the economy's strength, as they often judge it by the volatility of the markets.
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Even if these correction targets for the Nasdaq-100 and S&P 500 are fully met, we will still be in a bull market. At the same time, there is a chance that the monetary authorities will be more cautious in their comments on the economy's strength, as they often judge it by the volatility of the markets.
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#WaveAnalysis
#GBPNZD broke support level 2.0640
Likely to fall to support level 2.0400
GBPNZD recently broke the support level 2.0640 (which reversed the pair multiple times in July) intersecting with the support trendline of the weekly up channel from February.
The breakout of the up channel from February follows the earlier breakout of the sharp up channel from May, accelerating the active impulse wave c.
GBPNZD can be expected to fall further toward the next support level 2.0400 (target for the completion of the active ABC correction 2).
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#GBPNZD broke support level 2.0640
Likely to fall to support level 2.0400
GBPNZD recently broke the support level 2.0640 (which reversed the pair multiple times in July) intersecting with the support trendline of the weekly up channel from February.
The breakout of the up channel from February follows the earlier breakout of the sharp up channel from May, accelerating the active impulse wave c.
GBPNZD can be expected to fall further toward the next support level 2.0400 (target for the completion of the active ABC correction 2).
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#WaveAnalysis
#GBPUSD broke support level 1.2325
Likely to fall to support level 1.2150
GBPUSD recently broke the strong support level 1.2325 (which has been reversing the price from April) intersecting with the 61.8% Fibonacci correction of the uptrend from March.
The breakout of the support level 1.2325 accelerated the active impulse wave (5), which belongs to the higher impulse wave 3 from July.
GBPUSD can be expected to fall further toward the next support level 1.2150 (target for the completion of the active impulse wave (5)).
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#GBPUSD broke support level 1.2325
Likely to fall to support level 1.2150
GBPUSD recently broke the strong support level 1.2325 (which has been reversing the price from April) intersecting with the 61.8% Fibonacci correction of the uptrend from March.
The breakout of the support level 1.2325 accelerated the active impulse wave (5), which belongs to the higher impulse wave 3 from July.
GBPUSD can be expected to fall further toward the next support level 1.2150 (target for the completion of the active impulse wave (5)).
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Crypto market cap fell to $1.04 trillion from $1.06 at the start of last week. The Crypto's Fear and Greed Index briefly dipped into Fear territory at the end of the week but returned to Neutral (47) on Monday.
Bitcoin has been unable to break out of its sideways for a prolonged period. Trading at $26.1K at the start of Monday's session, it's down just 1.5% over the past 24 hours, 2% over the past seven days, and 0.5% from its level 30 days ago. The 50-day moving average remains active resistance. If the bearish momentum develops, we will closely monitor the dynamics around $25.8K, the previous consolidation area. A failure here could trigger a rapid decline to $25.8K. If the coin doesn't get bought back here as well a direct path to $20K will open.
Ethereum is still unsuccessfully trying to find support and is trading below $1580. And this downtrend is revealing the general sentiment of market participants, where the risk appetite is diminishing. The move towards $1400 may have already begun.
Bitcoin has been unable to break out of its sideways for a prolonged period. Trading at $26.1K at the start of Monday's session, it's down just 1.5% over the past 24 hours, 2% over the past seven days, and 0.5% from its level 30 days ago. The 50-day moving average remains active resistance. If the bearish momentum develops, we will closely monitor the dynamics around $25.8K, the previous consolidation area. A failure here could trigger a rapid decline to $25.8K. If the coin doesn't get bought back here as well a direct path to $20K will open.
Ethereum is still unsuccessfully trying to find support and is trading below $1580. And this downtrend is revealing the general sentiment of market participants, where the risk appetite is diminishing. The move towards $1400 may have already begun.
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