Crypto & Economic Calendar
The events listed below inform governments, corporations, traders and investors on the health of the economy, which can lead to volatility in markets and currencies.
- 1000 ET: [USD] CB Consumer Confidence
- 1000 ET: [USD] New Home Sales
- India: Holiday
- 0930 ET: [USD] Fed Chair Jerome Powell (JPOW) Speech
- 1030 ET: [USD] Crude Oil Inventories
- 0230 ET: [USD] Fed Chair JPOW Speech
- 0800 ET: [EUR] German Consumer Price Index (CPI)
- 0830 ET: [USD] Gross Domestic Product (GDP) [QoQ]
- 0830 ET: [USD] Initial Jobless Claims
- 2130 ET: [CNY] Manufacturing Purchasing Managers Index (PMI)
- 0200 ET: [GBP] GDP [YoY & QoQ]
- 0500 ET: [EUR] CPI [YoY]
- 0830 ET: [USD] Core Personal Consumption Expenditure (PCE) Price Index
Bitcoin Bulls’ Growing Confidence
Summary: Bitcoin finally recovered the $30,000 resistance that rejected it in April. We saw a 20% increase in just ten days, fueled by developments around Bitcoin exchange-traded funds (ETFs). In mid June, the largest asset manager in the world, Blackrock, filed an application for a Bitcoin ETF. This triggered a flurry of similar applications. Industry insiders believe BlackRock’s move signals a rising interest in, and confidence that further ETF approvals are on the horizon. Bitcoin has been steady in the $30k range, but a retracement lower isn’t out of the question yet.
Bitcoin Levels: $30k marked the most important support level in 2021’s bull market. $30k withstood several retests, until the Luna meltdown in mid 2022. Afterwards, Bitcoin didn’t touch $30k again until April 2023, when it began to range between $25,000 and $30,000. This continued until the BlackRock news broke the indecision, sending price on a 20% rally. Current levels to monitor:
- Immediate support: ~$30,000
- Current value range: $29,000-$30,700 [historically bearish range due to the massive distribution during the Luna meltdown; optimistically flipping to accumulation range now]
- Support levels: $28,900-$29,000; $27,700; $26,300, $25,500
- Resistance levels: $31,300-$32,000; $34,000-$36,500; $37,500; $40,000
Bull Perspective: With big names like BlackRock entering the market, bulls’ confidence is rising. Closing the weekly at or above $30k is the best scenario for bulls, and price is currently retesting that support level. However, intraweek a retest of key fibonacci levels is likely and healthy.
- 23.6% retracement at $29,000
- 38.2% retracement at $28,300
- 50% at $27,500
- Under $27,000 is unlikely given the current sentiment and may lead to steeper losses
Bear Perspective: Regulatory uncertainty still hangs over the crypto market, including Bitcoin and Ethereum. The entrance by big players like BlackRock isn’t all good news – many have a reputation for manipulating markets. Example- around a year ago JP Morgan was fined nearly $1 billion dollars for manipulating commodity markets. For good reason we should be cautiously optimistic over the ETF news, and also hope that the SEC and CFTC (US regulators) don’t try to crush traditional crypto players to make room for their friends in traditional financial markets.
From a price action perspective, $30,000 was only barely recovered, and with economic woes and risk rising in certain markets, like commercial real estate, a recession isn’t out of the question. Its hard to predict where Bitcoin will go in the even of a real estate collapse and recession.
Special Note: One item work keeping a closer eye on- Chinese markets. China did an excellent job in timing their “ban” of crypto in 2021, it was timed near the top of the market around $60,000. This let many of their investors to exit in profit. Now working through Hong Kong as their crypto hub, they are re-entering the market in size.
My suspicion is that Chinese investors have been quietly stacking crypto over the past year, and ramping up that accumulation recently. The other two parts to the bull market trifecta in 2023-2024 will be 1.) large funds entering the space (like BlackRock) and 2.) the US Dollar dropping (reference the US Dollar Index – DXY).
US Dollar Index (DXY)
The US Dollar Index continues to flirt with a historically bearish level around 101. Seven times in recent decades, 101 rejected the recovery or upside continuation of the DXY, sending it much lower for at least a year.
While the DXY is a complicated index with a lot of external factors that impact its value, you can look at the relationship between DXY and Bitcoin simply. They almost always move inverse to each other – when DXY is up, BTC is down; and the opposite is true.
While the DXY can continue to range near/above 101, it appears to be in a slow downtrend. Coupled with Bitcoin’s rising sentiment and next year’s halving, things are shaping up for a bullish 2024.
The Cryptocurrency Fear and Greed Index peaked at 69 in April, after a solid two months of recovering price and consumer confidence. A series of SEC actions shook investors, bring it down as low as 41 in June, but that quickly recovered on the back of the BlackRock ETF news.
The overall risk appetite, including that of crypto markets, appears to be growing. But continued appetite will be dictated more by the macroeconomic climate than crypto regulators, so monitoring of the US Fed and European Central Bank (ECB) as leading sentiment indicators is important.
Think about self-custody of your crypto, using technology like Ledger or Trezor. Storing your crypto on exchanges leaves it vulnerable to loss, if the company goes out of business. It also is used by exchanges to offer derivative services, which isn’t always beneficial to traders. Here are five reasons to consider hardware wallets:
- Control and Security: Hardware wallets are offline wallets that provide users with full control over their cryptocurrency assets, reducing reliance on third-party services which can be vulnerable to hacks or service disruptions.
- Privacy: With self-custody, users maintain their financial privacy. In traditional banking and some cryptocurrency exchanges, transactions and account details are known to the institution, which allows them to do things like sell their order book info to whales and institutions, or like FTX – they traded against their own customers.
- Direct Ownership: Self-custody of cryptocurrency means direct ownership. It represents the core principle of cryptocurrency – the idea of decentralization and eliminating the middleman in financial transactions. The user owns the keys and therefore owns the coins.
- Less Trust Dependence: With hardware wallets and self-custody, the security of your crypto assets doesn’t depend on the promises or competence of a third party. This becomes particularly important considering the history of security breaches on major crypto exchanges where users have lost their holdings. The author can speak to that one personally – I lost a lot of my portfolio when a third party who had custody of my coins was hacked
- Recovery and Redundancy: Hardware wallets often support recovery phrases to restore wallet data, allowing users to recover their assets in case the device gets lost, stolen, or damaged. This feature provides an extra layer of security and comfort for the user, knowing that their assets can be recovered and aren’t tied to a single piece of hardware.
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