Soaring dollar will lead to “explosive” market repricing

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Posted by ZeroHedge

on Friday, 25 May 2018 07:19

"A curious" event that took place about a month ago, aggravated by other "Big Changes" like the US considering tariffs on German, Japanese, North Korea cancelling the summit then virtually begging to reinstate, home prices “skyrocketing” while home sales fall, Bitcoin tumbling on news of DOJ probe into price manipulation there's more Big Change coming - R. Zurrer for Money Talks

Something curious took place one month ago when the PBOC announced on April 17 that it would cut the reserve requirement ratio (RRR) by 1% to ease financial conditions: it broke what until then had been a rangebound market for both the US Dollar and the US 10Y Treasury, sending both the dollar index and 10Y yields soaring...

10Y vs USD

... which led to an immediate tightening in financial conditions both domestically and around the globe, and which has - at least initially - manifested itself in a sharp repricing of emerging market risk, resulting in a plunge EM currencies, bonds and stocks.

2018-05-18 11-36-59

Adding to the market response, this violent move took place at the same time as geopolitical fears about Iran oil exports amid concerns about a new war in the middle east and Trump's nuclear deal pullout, sent oil soaring - with Brent rising above $80 this week for the first time since 2014 - a move which...

.....continue reading more HERE






Bitcoin whales dump $100 million of digital currency in 24 hours

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Posted by MarketWatch

on Wednesday, 18 April 2018 05:41





Those still hoping for Bitcoin $200,000 were given a serious setback by a $200. drop in 20 minutes, possibly by a single seller. Trading this morning at $8,069. Bitcoin is a long way from its alltime intraday high of $19,750. - R. Zurrer for Money Talks

MW-ES103 whalew 20160721075436 MG

Did a single seller move the price of bitcoin $200 in 20 minutes?

The price of bitcoin took a dive Tuesday, falling by more than $200 in under 20 minutes, a move that could have been the result of a single seller unloading a sizeable amount of the digital currency.

The balance of wallet 3D2oetdNuZUqQHPJmcMDDHYoqkyNVsFk9r — an anonymous digital account which is valued at $1.49 billion — fell by 6,500 bitcoin Tuesday, with the average sale price sale being $8,146.70, a total value of just over $50 million, according to bitinfocharts

The sale comes a day after the third-largest wallet, which famously purchased over $400 million in bitcoin in February, let go of 6,600 bitcoin at an average price of $8,026. All told, the two whales dumped over $100 million of bitcoin within 24 hours.

Screenshot 2018-04-18 06.54.03

As expected, online forums lit up, speculating on what or who was behind the sharp move lower. 

“Holy hell, these dumps out of nowhere. I was looking at some alts, then I check back to bitcoin and BAM it dropped $200 instantly,” one Reddit user wrote. 

Initial reaction was to point the finger at New York Attorney General Eric Schneiderman, who announced he was launching an inquiry into 13 cryptocurrency exchanges, seeking information including exchange fees, volume data and procedures around margin trading. 

However, that news broke nearly four hours before bitcoin’s move lower.

MW-GH508 balanc 20180417160201 NS

Previous selloffs in bitcoin have been blamed on sizeable single-user selling, with the most famous case being the Mt. Gox sale on March 7, when its trustees announced they had liquidated over $400 million in bitcoin and bitcoin cash. 

Significant selling seems to be the flavor of the month. On April 12, the second-biggest bitcoin wallet sold $38 million of the No. 1 digital currency. 

Early Wednesday, a single bitcoin BTCUSD, +2.19%   was worth $8,111.56, up 2.5% after battling to hold above the $8,000 mark, having got a boost late Tuesday on upbeat remarks from International Monetary Fund Managing Director Christine Lagarde.



Major Currency Pairs Summary

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Posted by Jack Crooks - Currency Currents

on Tuesday, 10 April 2018 05:32

Ever critical for the value of investments in different currencies, the US Dollar is down again today for the third day in a row. Jack Crook's forecast of the major currency pairs has been very accurate to date, and this analysis will tell you where you can expect the US Dollar, Euro, CDN Dollar, Japanese Yen Australian Dollar and the Great British Pound will be headed next. - R. Zurrer for Money Talks

US Dollar Index

Update: 8 April 2018/4:03 am ET

Price at update: 90.11

Wave Description: (i)|[v]|5 final thrust lower

Price Target: 87.27
Resistance: 90.98|92.40
Support: 89.82| 88.25
Forecast Negation: 92.98

Wave Analysis

Is Wave [iv]’s maddening triangle pattern finally complete? Did we see a near-term reversal pattern on Friday? We are working from the premise of yes and yes; and it is why we got long EUR/USD. Targeting down to at least 87.27 in Wave [v].


Larger Chart



Update: 8 April 2018/4:03 pm ET

Price at update: 1.2281

Wave Description: (i)|[i]|5 impulse rally

Price Target: 1.2623
Resistance: 1.2623 1.2344
Support: 1.2476 1.2153
Forecast Negation: 1.1960

Wave Analysis

Working off the premise that wave [iv] complex triangle pattern is complete with the bullish engulfing reversal pattern on Friday. (Note last two recent bullish engulfing patterns spiked out short-term bottom—each followed by an approximate 300 pip bounce.) We have revised our price target to 1.2623 based on confluence extension of Wave [i] by 1.618 and Wave [v] equality with Wave [1]—both carry exactly to 1.2623 (our minimum target). There is scope to go higher: targets above 1.2623 are 1.2779; then 1.2876.


Larger Chart


Update: 8 April 2018/4:03 pm ET

Price at update: 1.2769

Wave Description: B/(C)/[2] Zig Zag

Price Target: 1.2496 (then 1.3424)
Resistance: 1.2943|1.3128|0.7916
Support: 1.22729 | 1.2581|1.2445
Forecast Negation: 1.3124
Wave Analysis
Another zig zag pattern seems in play here- A-B-C targeting eventually to 1.3424 to complete major wave (C) of [2]. But in the meantime, we are expecting a push down to 1.2496-level in minor [c] to complete Wave B. Note the head and shoulders setup in this chart; the neckline was broken today and the price target of 1.2496 is based on the that pattern.



Larger Chart


Update: 8 April 2018/4:03 pm ET

Price at update: 106.79

Wave Description: [iv]|5|(1) impulse rally

Price Target: 103.39 
Resistance: 107.49/ 107.90
Support: 104.55|103.3 9

Forecast Negation: 110.83

Wave Analysis
We were thinking Wave [iv] of a narrowing triangle pattern was complete, but it seems there is more to go. But, this is a very complex correction to confidence on exactly how this plays out is murky still. Either way we do believe this move down targets to at least 103.39 in a final Wave [v] of 5 of (1); after that a multi-month rally should resume.



*Note, if you are interested in the Great British Pound and/or the Australian Dollar for the same analysis go HERE









Crypto-Currencies: The Current State of the 3 Largest

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Posted by Jill Mislinski - Advisor Perspectives

on Thursday, 05 April 2018 08:39

The attack on cryptocurrencies by centralized financial institutions in the name of “protecting investors from volatility” continues. Last week one of Canada’s largest banks blocked cryptocurrency purchases, a move that followed similar bans in the United States by large banks like JP Morgan. The Reserve Bank of India has issued a blanket ban on all cryptocurrency trading:

You will not be able to buy cryptocurrency via banks or e-wallets etc. in India anymore as Reserve Bank of India (RBI) has banned them with immediate effect from “dealing with or providing services to any individuals or business entities dealing with or settling virtual currencies”.

Whether it was the moves by Central Banks or that is just the excuse, a quick glance at these charts reveals the current  state of the Crypto market - R. Zurrer for Money Talks

New Weekly Update: The Three Largest Cryptocurrencies

With all the focus on bitcoin lately, we've added a new weekly update that tracks the three largest cryptocurrencies by market share: bitcoin, Ether, and Ripple. According to Wikipedia, a cryptocurrency is "a digital asset designed to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets."

Bitcoin is the world's first cryptocurrency and decentralized digital currency. The first bitcoin transaction occurred in early 2009 and has since grown worldwide. Ether is another cryptocurrency run on the Ethereum blockchain platform and has the second largest market share, despite being the newest of the three with its launch in July 2015. The third largest market share of cryptocurrency, XRP, is owned by Ripple and launched in 2012.

Here are all three cryptocurrency prices over time along with their trading volume. Data for all three is sourced from Coinbase.com and by request, we have shortened the time frame for a more recent picture.





Blowing Off Trade War Worries US Dollar Rises Again

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Posted by Nadia Simmons

on Thursday, 05 April 2018 06:24

Despite fears a Trade War would dull the Dollars appeal, the dollar Index jumped again this morning. espite consistent headlines declaring the US dollar will fall because of the US China trade war. As you can see from the chart below, while the US dollar did fall though long before trade war worries became persistant, versus a basket of currencies in fact it has moved up over 1 percent since the end of January. The USD/CAD currency is also covered below - R. Zurrer for Money Talks

Note: Double click all charts for larger images

In yesterday's Forex Trading Alert at 9:31am, we took a closer look at the current situation in the USD Index:


From the short-term point of view, we see that the greenback came back above two important resistance lines – the previously-broken lower border of the black declining trend channel and the upper line of he blue declining wedge.

Yesterday, the index verified this breakout, which together with the buy signals generated by the indicators suggest further improvement.

How high could the U.S. dollar go in the coming day(s)?

In our opinion, the first upside target will be around 90.77, where the 38.2% (Ed Note: at 6:24am PST April 5th the US dollar is up +0.24 at 90.36) Fibonacci retracement and the March peak are. Additionally, in this area the size of the upward move will correspond to the height of the rising wedge (we marked it with the green ellipse), which increases the probability of the pro-bullish scenario in near future.

If this is the case and the index climbs to our first upside target, we’ll also see a realization of the bearish scenario in the case of EUR/USD as the exchange rate will test the March low and our downside target at 1.2173.

USD/CAD Rewards Bears

USD/CAD - the weekly chart

Looking at the medium-term chart, we see that although USD/CAD moved a bit higher earlier this week, currency bears took control quite quickly, which resulted in another move to the downside. Additionally, the sell signals generated by the weekly indicators remain in the cards, supporting currency bears and lower values of the exchange rate.

Are there any short-term factors that could thwart these plans?

USD/CAD - the daily chart

Before we answer to this question, let’s recall the quote from our last commentary on this currency pair:

(…) although USD/CAD bounced off the blue support zone, the pair is still trading in the green consolidation around the yellow resistance zone and well below the previously-broken lower border of the green rising trend channel.

What does it mean for the exchange rate? In our opinion, as long as the pair remains under the upper border of the formation, another attempt to move lower is very likely.

If this is the case and USD/CAD extends losses from here, we’ll see (at least) a re-test of the blue support zone in the coming days, which will make our short positions even more profitable (as a reminder, we opened them on March 19, when USD/CAD was trading at around 1.3116).

As you see on the daily chart, the situation developed in tune with our assumptions and USD/CAD declined sharply after unsuccessful attempt to break above the upper border of the green consolidation. Thanks to yesterday’s downswing, the pair dropped under the lower line of this formation and reached our next downside target - the blue support zone and the 38.2% Fibonacci retracement.

Although this support area could trigger a rebound, the sell signals generated by the indicators remain in the cards, which together with yesterday’s breakdown suggest further deterioration and a drop to around 1.2709, where the size of the move will correspond to the height of the green consolidation.

And speaking about the bearish potential… Looking at the daily chart, you probably already noticed a potential head and shoulders formation. You're right, the right arm of the pattern doesn’t look perfectly like in technical analysis books, but yesterday’s downswing took the exchange rate under the neck line of the formation, increasing the probability of a bigger move to the downside. Nevertheless, in our opinion, such price action will be more likely and reliable if USD/CAD falls below the blue support zone. In this case, the likelihood of a decline under the above-mentioned downside target will increase significantly.

So, how low could the exchange rate go if the situation develops in line with the pro-bearish scenario?

USD/CAD - the daily chart

In our opinion, the next downside target will be around 1. 2506, where the size of the downward move will correspond to the height of the head and shoulders formation. Nevertheless, before we see the pair at this level, currency bears will have to break under 50% and 61.8% Fibonacci retracements first. Therefore, we will continue to monitor the market and keep our subscribers informed should we see a confirmation/invalidation of the above.


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