Another very volatile week of trading ends in the financial markets where stocks gyrated from one extreme to another, Cryptos continued their steep decline & Greenback’s strength further gained traction. Let’s dissect the information.
The Crazy Cryptoverse
There’s never enough to report about #Cryptoverse every week & this one is no exception either. Further news about regulations from Australia, restrictions on Cryptocurrency trading by the Indian Central bank & hacks on Verge coin continued to compound the persisting conundrums for the Cryptos. For now the interest in Bitcoin & its peers continues to wane but I still believe the storm will eventually pass & things will settle down.
The Cryptos did however get an unlikely vote of confidence at the end of the week from George Soros (broke the Bank of England in 1992) who had called the digital assets a ‘bubble’ in January — Now his $26 billion family office is planning to trade the digital assets. It seems all of these big names wanted in the action but at a bargain by creating all this FUD!
Market cap for the cryptos slid further this week to $249 billion from $265 billion at the time of writing with the Bitcoin dominance holding at 45.2%. Let’s look at some price levels of the Top 5 Cryptos
Bitcoin (bearish) — R1:$7800 R2:$9200 S1:$6500 S2:$5800
Ethereum (bearish) — R1:$455 R2:$570 S1:$355 S2:$340
Ripple (bearish) — R1:$0.55 R2:$0.70 S1:$0.30 S2:$0.17
Litecoin (bearish) — R1:$137 R2:$150 S1:$107 S2:$85
Bitcoin Cash(bearish) — R1:$765 R2: $940 S1:$530 S2:$380
USEFUL CRYPTO RESOURCES:
INFO GRAPHIC OF THE WEEK:
The current bout of risk aversion has helped the Greenback if anything with the Dollar index bouncing off the temporary base. The consolidation off the support still continues but the trajectory is upwards, however, we will need a confirmation with a break of the 91.00 level. Let’s look at some of the noticeable moves this week.
With the trade war fears looming large the FX markets reaction has been rather mixed unlike Stocks & Cryptos which are only headed south. The bullish posturing in USDJPY & USDCHF does not support the Equity market moves as both Franc & Yen are considered bigger safe havens than the Dollar in such scenarios. Both pairs held off pretty well in the wake of a disappointing NFP release & remain bullish. USDCAD is the star of the Majors this week with the persistence strength attributed to a better than expected Job report out of Canada & anticipation of a deal on NAFTA soon. However, I would be careful of taking any long term positions in the pair since the geo political risks with trade war worries might very well reverse the fortunes of the risk currencies.
Talking about the rattling of the markets USDJPY is the ideal pair to look at to determine the direction of the FX Markets and as I said does not support the doomsday scenario at least not just yet.
RESISTANCE/SUPPORT PRICE LEVELS OF MAJOR FX PAIRS:
EURUSD (Euro) S3:1.2168— S2:1.2217— S1:1.2254 — R1:1.2312 R2:1.2343 — R3:1.2401
USDJPY (Yen) S3:104.81 — S2:105.67 — S1:106.21 — R1:107.08 — R2:107.40 — R3:108.26
GBPUSD (Pound) S3:1.3908 — S2:1.3986— S1:1.4036 — R1:1.4114 R2:1.4143 R3:1.4221
USDCAD (Loonie) S3:1.2610— S2:1.2701 — S1:1.2736 — R1:1.2827 R2:1.2883 — R3:1.2974
AUDUSD (Aussie) S3:0.7582 — S2:0.7641 — S1:0.7679 — R1:0.7738 R2:0.7760 — R3:0.7819
USEFUL FOREX RESOURCES:
INFO GRAPHIC OF THE WEEK:
And Finally the whip saw action comes to an end in the US market with the week kicking off on a bearish note but than on Wednesday DOW reversed 700 points & some were thinking it might have been an “epic bear trap” specially after a follow up rally on Thursday but than came the news that US was considering imposing another $100 billion worth of tariffs on additional Chinese exports & everything went haywire with the DOW dropping more than 2% to end the day.
The SPX has failed at the pivot around 2670 & headed to the lower boundary of the recent consolidation. I am sure we are going to test that 2580 support level confluent with the 200EMA again. This volatility has crushed many & burnt others. My advise is to sit on the sidelines & let this play out. Enter the game when all the dust has settled & path has been cleared in one direction or the other.
The trending story on the US market this week was the debut of Spotify (SPOT) which had a wild ride — reaching as high as $169.11 before falling off to a low of $135.43 to end the week with a bounce off to $147.92 — up 12% from the initial reference price of $132, giving the Swedish company a market valuation of around $26.6 billion
Looking at the MSCI World Index presents an interesting picture despite the massive sell off seen at the end of the week. Comparing it with the 3 Major indices of the world (SPX, FTSE & NIKKEI) still shows an upward bounce from the support of the recent lows. Next week will clarify whether this will turn in to something meaningful or is it just a dead cat bounce!
USEFUL STOCK RESOURCES:
INFO GRAPHIC OF THE WEEK:
To wrap things up… here’s a little fun fact from history last week:
April 4, 1975: Microsoft was founded by Bill Gates and Paul Allen in a garage space in Albuquerque. Windows and Microsoft Office, have won the company a clear dominance in the tech industry. Today, it’s the largest software company by revenue as of 2017. #Investopedia
Until next week, you can follow me on TradeAlike app (@Fakd) to receive real time alerts on Forex & Stocks. I also post my trade ideas, stats & news on a daily basis on Twitter & StockTwits — “Trade Nut” signing off!