Bitcoin Surges Past $65,000 Aiming Record Highs

Traders' Opinions

Cryptocurrency

Summary:

The foremost cryptocurrency is currently within a 5% margin of its 2021 peak in terms of U.S. dollars.

During the early hours of Monday in Europe, Bitcoin (BTC) surpassed the $65,000 threshold, edging closer to its peak value of $69,000 recorded in November 2021, as bullish sentiment drove the value of bets to an unprecedented level.

Bitcoin Surges Past $65,000 Aiming Record Highs_1

In the past 24 hours alone, the leading cryptocurrency has surged by over 6%, while the CD20, a comprehensive index encompassing various tokens, climbed by 5.6%. With Bitcoin now only 5% shy of its all-time high in U.S. dollars, it has recently surpassed peak prices against several major and emerging-market currencies. Today, it also attained a new record high when measured in euros.

Indications from the futures market suggest the potential for further gains. Open interest, reflecting the number of outstanding futures contracts, surged to an unprecedented $27 billion, according to data from Coinglass. This rise in interest signals the influx of new capital into the market. Additionally, market capitalization has soared to a record $2.8 trillion, surpassing the previous peak of $2.7 trillion set in November 2021, as per data from multiple sources.

Major Wall Street entities have played a pivotal role in propelling cryptocurrencies to unprecedented heights, as evidenced by the record-breaking inflows into Exchange-Traded Funds (ETFs) focused on new asset classes. According to CoinShares, a crypto investment group, these influential players collectively attracted a staggering $7.4 billion since the commencement of trading. To put this into perspective, consider the inaugural gold ETF, the BlackRock iShares Gold Trust, which garnered a modest $288 million within the initial two months post-launch back in 2005.

The sudden surge of fresh capital prompts speculation regarding its potential impact on the dynamics of Bitcoin pricing. This market has a historical pattern of experiencing significant surges, followed by dramatic downturns, only to surge again at even higher levels, with increased capital involvement on each occasion.

This market performance has largely been fueled by the psychology of retail investors, many of whom are still gripped by the fear of missing out. As Bitcoin surpassed the $60,000 mark on Wednesday, Coinbase, a prominent cryptocurrency exchange, struggled to cope with the surge in user traffic, leading to temporary disruptions and causing numerous customer balances to erroneously display as $0.

Should the price movement of Bitcoin adhere to past patterns, the next three months are poised to be turbulent for the cryptocurrency. However, if this trajectory diverges, it may suggest that Bitcoin has undergone fundamental changes influenced by the influx of ETF investments.

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Add to Favorites

Ukadike Micheal

Economic

Forex

Wall Street stocks opened lower on Monday, retracing from the record highs achieved last week, as investors adopted a cautious stance while awaiting key signals on the future of U.S. interest rates. The upcoming week promises a flurry of commentary from Federal Reserve policymakers, with Chairman Jay Powell's testimony before the House Financial Services Committee on Wednesday taking center stage. Additionally, the closely watched non-farm payrolls report, scheduled for release on Friday, will be under scrutiny, with market participants mindful of the potential impact on interest rate decisions.

U.S. markets kicked off the week with declines, following the record-closing highs of the S&P 500 and Nasdaq in the previous session. The Dow Jones Industrial Average opened down by 0.30%, shedding 118.61 points to reach 38,968.77. The S&P 500 opened 0.12% lower, down 6.09 points at 5,130.99, while the Nasdaq Composite dipped 0.07%, losing 10.73 points to open at 16,264.21.

Investors are particularly focused on the comments from Federal Reserve policymakers, seeking insights into the future trajectory of U.S. interest rates. Federal Reserve Chair Jerome Powell's congressional testimony on Wednesday is anticipated to provide crucial guidance amid heightened uncertainty in the financial markets. The central bank's stance on interest rates holds significant weight, influencing investment decisions and market sentiment.

The spotlight also falls on the upcoming non-farm payrolls report, a key economic indicator that could shape expectations around the labor market. A robust labor market might complicate the outlook for anticipated interest rate cuts, contributing to the cautious sentiment among traders.

As market participants navigate this pivotal week, technical analysts observe the potential impact on stock prices and overall market dynamics. The retracement from record highs suggests a degree of caution among investors, with the focus on upcoming economic data and the Federal Reserve's policy direction. Market technicals, including support and resistance levels, will play a crucial role in determining the short-term trajectory.

The cautious opening on Wall Street sets the tone for a week packed with significant events, including Federal Reserve commentary and critical employment data. Investors are poised to react to insights from Powell's testimony and the implications of the non-farm payrolls report, factors that could steer market sentiment and influence trading decisions in the days ahead. The technical perspective underscores the importance of monitoring key levels and signals as the market responds to unfolding developments.

Source: Investing

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Alex

Political

Super Tuesday next week could be former U.N. Ambassador Nikki Haley's last chance to stop former U.S. President Donald Trump's drive to clinch the 2024 Republican presidential nomination.

Fifteen states and one U.S. territory hold the party's nominating contests on March 5, the biggest day of primaries when more than a third of delegates will be assigned to July's Republican National Convention in Milwaukee.

President Joe Biden is a shoo-in for the Democratic nomination when party loyalists vote for delegates to August's Democratic National Convention in Chicago with only two long-shot challengers remaining.

Here are the key details about Super Tuesday:

What is super Tuesday?

Super Tuesday describes the day in the U.S. presidential primary cycle when the most states vote.

In the Republican contest, 874 of 2,429 delegates will be up for grabs, including from the two most populous states, California and Texas. At least 1,215 delegates are needed to win the nomination at the Republican National Convention in July.

Contest-by-contest, the Republican delegate counts for the Super Tuesday votes are: Alabama (50), Alaska (29), American Samoa (9) Arkansas (40), California (169), Colorado (37), Maine (20), Massachusetts (40), Minnesota (39), North Carolina (74), Oklahoma (43), Tennessee (58), Texas (161), Utah (40), Vermont (17) and Virginia (48).

About a third of Democratic delegates will also be decided on March 5, with nominating contests held in 14 of those 15 states, plus American Samoa. In Alaska, Democrats vote on April 6.

March 5 is also the final day for Democrats in Iowa to mail in their ballots in that state's caucuses and when results will be announced.

When is super Tuesday and what can we expect?

Super Tuesday is on March 5 this year. With so many states and a territory voting across different time zones, it could take a while for the full results to be clear.

In California, vote-by-mail ballots are valid as long as they are postmarked on or prior to primary election day and received by March 12.

In addition, some states hold "open primaries" that allow registered voters to choose whether to cast their ballots in the Democratic or Republican primary, adding a possible layer of unpredictability.

Why is it important?

Haley has no clear path to beating Trump. This could be her last chance to at least slow the former president's path to the nomination.

Opinion polls show Trump to be an overwhelming favorite in California and Texas, as well as in states such as Alabama, Maine and Minnesota. His campaign projects that he will win at least 773 delegates on Super Tuesday and clinch the nomination a week or two later.

Trump has easily swept all six Republican nominating contests in Iowa, New Hampshire, Nevada, the U.S. Virgin Islands, South Carolina and Michigan. He has repeatedly urged Haley to drop out to set up a rematch of the 2020 election against Biden that polls show many Americans don't want.

Haley, a former South Carolina governor who served as U.N. ambassador under Trump, has vowed to stay in the race. She will crisscross the country with an aggressive travel schedule leading up to Super Tuesday, and her campaign has rolled out a leadership team in Georgia, where voters go to the polls on March 12, a week after Super Tuesday.

Voters, she said after her defeat in South Carolina on Feb. 24, "have the right to a real choice, not a Soviet-style election with only one candidate.

"I have a duty to give them that choice," she added.

The Super Tuesday results in North Carolina will be closely watched for signs of each candidate's strength in one of the potential battleground states that could decide the November general election. Trump won the state in 2020 by just over a single percentage point.

North Carolina will award 74 delegates on Super Tuesday. The state allows voters who are unaffiliated with a party to participate in any primary they choose, which could boost Haley's performance given her relative strength with independent voters compared to Trump.

Source: Reuters

Risk Warnings and Disclaimers

Add to Favorites

Chandan Gupta

Traders' Opinions

Forex

Fundamental Analysis

Embarking on a financial journey this week, the spotlight is on the GBP/USD duo, ready to groove to the market beats, with the US taking the lead. On the UK stage, Chancellor Jeremy Hunt is set to unveil the budget, potentially the final act before the anticipated general election later this year.

Recent buzz centers on potential voter incentives and a possible end to the "non-domiciled" haven for wealthy foreigners. However, Hunt might be dancing on a tightrope when it comes to maneuvering around tax cuts.

While global financial markets bask in growing confidence regarding Britain's economic future, the pound and euro faced a recent dip in their global prowess. All eyes turn to the Bank of England (BoE) and the European Central Bank (ECB) forecasts, playing crucial roles in this forex theater. The BoE's recent dispute of an imminent interest rate cut, citing early uncertainties about sustainable inflation, leaves the sterling's fate hanging in the balance.

Turning the spotlight to economic data, the final reading of the British services sector's purchasing managers index for January boasts an eight-month high, revised upwards to 54.3 from the initial 53.8. Confidence, meanwhile, hits a nine-month peak. On the flip side, the rate of price increases in January, while strong, slows down to its lowest point in four months.

In the aftermath, Tim Moore, the director of economics at S&P Global Market Intelligence, puts on his analyst hat, noting, "Lower inflation and improving order books provide a strong boost to the services economy outlook." Business confidence in January, despite geopolitical tensions, signals that the services sector remains resilient. All eyes are now on the growth forecasts for 2024, holding the promise of a bullish narrative.

The plot thickens as MUFG Bank enters the scene, suggesting that the BoE might have tightened its grip a tad too much. The initial reluctance to signal easing is expected to wane, particularly if the Fed and ECB take the plunge with rate cuts in April, May, and June. BNP Paribas, however, takes a cautious stance, with the Bank of England's results reinforcing a reluctance to build long-term buying positions for the pound. The looming prospect of early interest rate cuts introduces a note of caution for sterling enthusiasts. Persistent Bearish Momentum Defines GBP/USD Currency Pair Movement_1

Persistent Bearish Momentum Defines GBP/USD Currency Pair Movement_1

Technical Analysis

the spotlight is firmly on the GBP/USD duo, set to cha-cha along its current downward trend. The week unfolds with a trio of high-stakes events that promise to jolt the markets and sway investor sentiments.

First up on the docket is the eagerly awaited UK budget announcement, a financial overture that could set the stage for the GBP/USD's next moves. As the fiscal notes are unveiled, analysts keenly watch for cues that might dictate the pair's trajectory.

Following this financial symphony is the pivotal testimony of Jerome Powell, the maestro of the US Federal Reserve. His words carry weight, capable of orchestrating market reactions and influencing the dance of currencies. Investors, attuned to every nuance, await Powell's insights that could shape the course of the GBP/USD tango.

The crescendo of the week reaches its peak with the release of US job numbers. A vital economic metric, these figures can be a game-changer, capable of dictating the mood in the forex arena. Investors scrutinize the employment data, seeking clues on the health of the US economy and its potential impact on the GBP/USD duo.

Zooming in on the daily chart, a key player in this financial drama, the GBP/USD pair reveals its cards. Hovering below the critical support level of 1.2600, a breach would mark a significant milestone for the bears, signaling potential dominance in steering the pair's trajectory southward. Analysts emphasize the importance of this juncture, urging a close eye on whether the pair can maintain its downward momentum.

Technical indicators, the unsung heroes of forex analysis, are in the spotlight. They whisper insights into potential market movements. If the GBP/USD pair continues its descent, eyes turn to support levels at 1.2550 and 1.2460. Analysts predict that a journey to these levels could see the technical indicators avoiding the strong oversold territory, suggesting that there might be further room for downward movement.

Conversely, in the midst of this bearish backdrop, there exists a glimmer of hope for the bulls. Breaking free above the resistance level of 1.2775 could be the key to unlocking a bullish outlook for the currency pair. Analysts argue that this breakthrough would be a significant turning point, potentially reshaping the narrative for the GBP/USD in the near term. Persistent Bearish Momentum Defines GBP/USD Currency Pair Movement_2

Persistent Bearish Momentum Defines GBP/USD Currency Pair Movement_2

Risk Warnings and Disclaimers

Add to Favorites

Zi Cheng

Traders' Opinions

Stocks

On Monday, Japan's benchmark Nikkei Stock Average soared to the significant milestone of 40,000, primarily propelled by surges in semiconductor stocks, buoyed by anticipations of heightened demand for generative artificial intelligence.

Japan's Nikkei Stock Index Touches New High Once Again_1

Nonetheless, the overall market performance presented a more nuanced picture. Major players like Fast Retailing, the parent company of Uniqlo, and automotive giant Toyota Motor witnessed declines. At the conclusion of Monday's morning session, approximately two-thirds of listed companies on the Tokyo Stock Exchange's Prime section experienced decreases.

Tomoichiro Kubota, senior market analyst at Matsui Securities, noted that investors are banking on the ongoing surge in artificial intelligence to fuel semiconductor expenditure, thereby benefiting Japanese firms involved in manufacturing. This ascent followed a surge in U.S. stocks on Friday, spurred by chipmaker Nvidia's market capitalization crossing the $2 trillion mark.

Since the beginning of the year, the Nikkei Stock Average has risen by 19%, following a 28% increase in 2023. Notably, on February 22, it surpassed its prior all-time high set in December 1989.

Foreign investors have significantly contributed to this rally, attracted by corporate governance reforms, a weakened yen, and the Nippon Individual Savings Account, a tax-deferred investment program tailored for small investors.

Particularly beneficial for investors with long-term horizons, there is one potential caveat looming, highlighted by the Bank of Japan. It is anticipated to phase out its negative short-term interest rate in the forthcoming months. Depending on the extent of the central bank's rate hikes, the yen may strengthen, potentially reducing the earnings of Japanese companies abroad and dampening stock market momentum.

Reason behind this bullish move

The surge was primarily fueled by the rise in technology stocks, which have been a driving force behind much of the Nikkei's growth. Tokyo Electron, a company specializing in semiconductor manufacturing and chipmaking equipment, has witnessed a remarkable increase of over 140% in the past year alone. In 2023, the Nikkei 225 emerged as the top-performing market in Asia, boasting a gain of more than 25%.

Increasing amounts of foreign capital are flowing into the Japanese market, influenced by notable investors such as Warren Buffett, CEO of Berkshire Hathaway, who bolstered his investments in major Japanese trading houses last year. Both BlackRock, the world's largest asset manager, and Amundi Asset Management, Europe's leading money manager, anticipate that earnings growth and corporate reforms will sustain the market's strength, as reported by Bloomberg.

Risk Warnings and Disclaimers

Add to Favorites

Economic

Central Bank

Forex

Progress on inflation

The Bank of Canada heads towards its second policy meeting of the year with some good news on the inflation front. The consumer price index eased to 2.9% y/y in January from 3.4%, falling below 3.0% for the first time since June 2023 when the disinflation process came to a pause. Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_1

Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_1

Crucially for policymakers, all three of the Bank of Canada's core measures of inflation tumbled in January to levels last seen in late 2021. Whilst it's too early to know whether this will be another temporary dip, the likelihood that inflation will soon hit 2% has gone up, raising the prospect of a rate cut sooner rather than later.

Overall rate cut expectations have been pared back since the start of the year, in line with the repricing for the Fed and other major central banks. Nevertheless, a 25-basis-point rate cut is now almost fully priced in for June.

Will the BoC flag a rate cut?

The Bank of Canada had predicted in January that inflation would hold around 3.0% in the first half of 2024 so the lower-than-expected CPI print could prompt officials to anticipate a faster return to the 2% target.

However, policymakers will likely want to see more evidence of inflation heading towards 2% in a sustainable manner and more data won't become available until the Bank of Canada's April meeting when coincidentally a new set of projections are also due to be published. Hence, a major policy shift is unlikely at the March meeting.

Not a good start to 2024 for the loonie

Yet, for the Canadian dollar, which has been on the backfoot versus the greenback all year, even a slight dovish lean by tweaking the language in the statement could worsen the bearish pressure.

Dollar/loonie is currently trading near two-month highs as the pair eyes the 1.3600 level. A dovish hold on Wednesday could see the pair test the 61.8% Fibonacci retracement level of the November-December downleg before aiming for the 78.6% Fibonacci of 1.3745. Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_2

Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_2

However, if the BoC maintains a cautious stance amid concerns about the housing market heating up again, dollar/loonie could pull back towards its ascending trendline that is being tracked by the 20-day moving average. A bigger correction would bring the 50-day moving average into scope at 1.3439.

Canada's property market conundrum

Canada's property slump appears to have bottomed and there are some indications that house prices have started to rise again. A recovery in the housing market at a time when shelter costs are already very high due to rising rental prices and higher mortgage costs could complicate things for the Bank of Canada.

Shelter inflation is currently the biggest upward contributor to prices in Canada and cutting rates risks exacerbating the problem.

A brighter outlook

The rebound in housing comes amid a broader bounce back in economic activity. Canada's economy returned to growth in the final quarter of 2024 following a contraction in GDP in Q3. The jobs market also appears to be on the mend with the unemployment ticking lower in January. Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_3

Will Bank of Canada Pave the Way for A Rate Cut after CPI Drop?_3

The next employment report is released on Friday (13:30 GMT) and investors will be watching for more signs that jobs growth is picking up. With wage growth running above 5.0%, a hot labour market would be another obstacle for the Bank of Canada to cut rates anytime soon.

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Zi Cheng

Traders' Opinions

Economic

Swiss inflation in February showed a less pronounced easing than anticipated, potentially tempering speculation regarding the central bank's earlier-than-expected interest rate cuts.

According to the Swiss statistics office on Monday, consumer prices increased by 1.2% compared to a year ago. Although slightly above the median prediction of 1.1% in a Bloomberg survey, this figure represents a decline from January's 1.3% and falls significantly short of the Swiss National Bank's first-quarter estimate.

Additionally, the core gauge, which excludes volatile elements such as energy and food, decelerated to 1.1%.

Switzerland February CPI Declines Not As Expected_1

The decline occurs amidst increasing speculation regarding the central bank's potential acceleration of its timeline for monetary policy easing. While the majority of economists anticipate that the Swiss National Bank (SNB) will delay its first rate cut until September, a growing contingent of analysts predicts action in June or even at the upcoming policy decision on March 21.

However, Thomas Gitzel, chief economist at VP Bank AG, who doesn't anticipate any SNB movement this year, highlighted that prices rose by 0.6% in February, tripling the pace seen in January.

"Increased price momentum in February," he wrote in an investor note. "This underscores the need for the SNB to proceed cautiously with any rate cuts."

Unlike its major counterparts, the Swiss central bank convenes only once per quarter, making this month's meeting the first of the year.

SNB President Thomas Jordan may interpret the data as validation, as he emphasized the central bank's capacity to maintain price stability when discussing his unexpected decision to step down later this year.

Thomas Jordan will likely prioritize the mitigation of all inflation risks before his departure in September," stated Gitzel. "He might opt to leave any monetary easing measures for his successor. Consequently, we do not anticipate any interest rate cuts this year."

In addition to alleviating inflationary pressures, the robust Swiss franc serves as a shield against importing inflation from other regions. Although the currency reached a record high against the euro earlier this year, it has since experienced some depreciation, a trend acknowledged by the SNB.

Data from the surrounding euro area indicates a 2.6% annual increase in prices last month. In comparison, Switzerland's gauge, based on the European Union's harmonized measure, stood at 1.2% during the same period.

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites