EUR/USD pair closed higher on Monday and followed through higher on Tuesday

The Euro US Dollar (EUR/USD) exchange rate is climbing today, following the poor reaction to yesterday’s US budget proposals. At the time of writing EUR/USD is up by around 0.3% today, with the pairing recouping around half of last week’s losses.

The US Dollar found itself sliding against the Euro and the majority of its other peers on Tuesday morning following a lukewarm reception to Donald Trump’s budget proposals for 2019. Trump outlined his plans for a $4.4 trillion spending spree over the coming year, which despite curbs to welfare spending, would likely see the US federal deficit climb to $1 trillion next year, should they be approved by Congress.

The EUR/USD is currently moving within the upward rising trend channel since London noon on Monday. The risk associated sentiment is currently against the US Dollar after last week’s equity market rout that has favored the US Dollar as a safe haven currency.

The pair’s 4 hours chart shows that the positive tone persists in the short-term as the price is above its 20 and 200 SMAs, although the early rally stalled a couple of pips below the 100 SMA, now the immediate resistance around 1.2360. The Momentum indicator in the mentioned chart keeps grinding higher well into positive territory, but the RSI lost upward strength, now hovering around 57. As long as the price remains above 1.2300, the downward risk will remain limited, but the bullish potential will be clearer only with a recovery above 1.2400, unlikely for today.

Support levels: 1.2300 1.2260 1.2225

Resistance levels: 1.2650 1.2400 1.2440

Sources:

https://www.fxstreet.com/news/eur-usd-euro-trades-higher-as-us-dollar-selloff-prevails-
201802131430

https://www.investing.com/currencies/eur-usd

https://www.ft.com/content/ed4e43fe-1064-11e8-940e-08320fc2a277

https://www.ft.com/content/ed4e43fe-1064-11e8-940e-08320fc2a277

https://www.fxstreet.com/news/eur-usd-euro-trades-higher-as-us-dollar-selloff-prevails-
201802131430

https://fxempire.com/forecasts/article/eur-usd-price-forecast-february-13-2018-technical- analysis-474574

https://finance.yahoo.com/news/eur-usd-aud-usd-gbp-075935301.html

Australian and New Zealand currencies updates: all quiet on “asian front”

Investors looking for low volatility currenciy pairs, might find something interesting here. AUD/USD was almost unchanged at 0.7863, the highest since February 7 during trading day on Monday and early on Tuesday. The National Australia Bank declared that th business confidence index rose to 12 in January from 11 the previous month, compared to expectations for a downtick to 10.

Although the U.S. 10-year Treasury Note traded over 2.9% for the first time in four years, U.S. Treasury yields did not dictate the direction of the currency this week. Instead, the price action was driven by renewed optimism towards stocks.

The main range is .7501 to .8135. Its retracement zone is .7818 to .7743. Trader reaction to this zone is likely to dictate the direction of the Aussie over the near-term.

The short-term range is .8135 to .7758. If the upside momentum continues then its retracement zone at .7947 to 7991 will become the primary upside target.

Based on the price action on Monday, the direction of the AUD/USD the rest of the week is likely to be determined by trader reaction to the main 50% level at .7818.

As for the New Zeland`s currency pair (NZD/USD), known as “kiwi”, the situation is the same – steady at 0.7268.

NZD/USD dropped below the 10 and 21 daily SMAs and the long upper wick with falling RSI leaves a bearish tint to the picture. 0.7200 opens a run towards the 100-D SMA at 0.7068. The upside targets 0.7520 through 0.7436.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.22% at 89.82 by 02:05 a.m. ET (06:05 GMT), the lowest since February 7

Sources:

https://www.fxstreet.com/news/nzd-usd-below-the-10-and-20-d-smas-bearish-bias-to-07068-201802122103

https://www.fxstreet.com/news/aud-usd-strong-headwinds-westpac-201802130650

https://www.investing.com/news/forex-news/forex–aussie-kiwi-almost-unchanged-in-late-trade-1235243

https://www.fxempire.com/forecasts/article/aud-usd-forex-technical-analysis-has-to-hold-7818-to-sustain-short-covering-rally-474530

Oil gains 2% amid stabilization on wold`s markets

Weakening dollar helps to boost oil by making dollar-priced crude cheaper for holders of other currencies. Brent crude futures (LCOc1) rose 95% to $63.74 a barrel by 1012 GMT, up nearly 2%, while U.S. West Texas Intermediate futures (CLc1) gained $1.03 to $60.23, up 1.8%. While oil is rebounding from its biggest weekly decline in two years, a surge in U.S. shale still looms over the market. OPEC boosted estimates for rival supplies for a third month in a row as prices encourage U.S. drillers, who have raised the number of oil rigs to the highest since April 2015. Still, OPEC’s president said U.S. shale won’t derail the group’s plan to clear a chronic surplus.

U.S. oil production C-OUT-T-EIA has risen above 10 million barrels per day (bpd), overtaking top exporter Saudi Arabia and coming within reach of top producer Russia.

OPEC and partners including Russia have agreed to cut their crude output by 1.8 million bpd for a second year, but U.S. production looks set to continue to grow.

Oil prices have skyrocketed almost 50 percent since the middle of last year, but investors were said to be unsure over a number of factors seen propelling the rally. U.S. producer discipline, healthy global demand and supply disruptions were all viewed with a sense of caution among investors, according to the investment bank.

Last week’s decline in oil prices was the largest one-week percentage decline since January 2016 after the market was hit by a raft of negative factors. Data showed an increase in U.S. oil production and an industry that is poised to pump more. The appreciation of the U.S. dollar also made oil more expensive for those holding other currencies and the selloff in equity markets saw investors abandon so-called risky assets like oil.

Sources:

https://www.bloomberg.com/news/articles/2018-02-12/oil-trades-below-60-as-shale-revival-counters-opec-output-curbs

https://www.reuters.com/article/us-global-oil/oil-gains-2-percent-as-global-markets-stabilize-dollar-dips-idUSKBN1FW02Q?il=0

https://www.chron.com/business/energy/article/Oil-rebounds-after-worst-week-in-two-years-12606787.php

https://oilprice.com/Energy/Oil-Prices/Oil-Prices-Collapse-Now-Spike-Later.html

https://www.cnbc.com/2018/02/12/goldman-sachs-oil-market-is-unconvinced-by-the-recent-price-rally.html

https://www.marketwatch.com/story/oil-prices-rebound-after-worst-weekly-loss-in-more-than-a-year-2018-02-12

 

 

Wall Street is slowly recovering from previous week`s slump

Investors are breathing a sigh of relief after the torrid times during previous week. The S&P 500 futures rose 28 points or 1.08% to 2,647.25 as of 6:39 AM ET (11:54 GMT) while Dow futures increased 269 points or 1.10% to 24,436.0. Meanwhile tech heavy Nasdaq 100 futures was up 66 points or 1.03% to 6,484.0. European stocks too are joining a global rebound as buyers move in following last week’s sharp overall falls, but sustained selling of US Treasuries ahead of inflation data is leaving investors feeling cautious.

The Europe-wide Stoxx 600 is 1.1 per cent higher in opening trade, turning around from a tumble of 5 per cent over the past five sessions. That was the worst performance since the first week of 2016 that was marred by worries over China.

London’s FTSE 100 rose 1 per cent and Frankfurt’s Xetra Dax 30 was up 1.3 per cent. Demand for technology and financial stocks is helping drive the trend.

In Hong Kong the Hang Seng index was 0.7 per cent higher, while in China the CSI 300 rose 1.3 per cent.

Forex

The dollar index is 0.2 per cent lower at 90.240. The euro is 0.3 per cent stronger at $1.2267 and the yen strengthened by 0.2 per cent to ¥108.54 per dollar.

Commodities

Brent crude is up 1.1 per cent at $63.47 a barrel after falling 3.2 per cent on Friday to a two-month low. US benchmark West Texas Intermediate is 1.3 per cent higher at $59.98 after dropping below $60 a barrel for the first time since December on Friday on concerns over higher US production.

Sources:

https://www.investing.com/news/stock-market-news/stocks–wall-street-on-track-to-recover-from-last-weeks-slump-1230097

https://www.ft.com/content/a108e1fe-0dec-11e8-8eb7-42f857ea9f09

https://www.ft.com/content/167ba166-0f95-11e8-940e-08320fc2a277

 

Proof of Stake is coming to cryptocurrencies, and it will change everything

Cyrrently, every single transaction in cryptocurrency blockchain needs to be ‘mined’ by powerful computers solving complex mathematical problems. The process ensures the security of the network, preventing double spends and other malicious actions. The process is known as a “Proof of Work” mining (the protocol underpinning Bitcoin and many others) uses as much energy as the nation Denmark. It’s a costly and lengthy process, and with the user base increasing everyday, traditional blockchains are sufferening increased workload.

With each transaction needing a lengthy confirmation process, the blockchain cannot scale easily as more and more users join the network. For example, Bitcoin transactions are now slow and expensive, with long backlogs of transactions waiting their turn.

Not only Bitcoin is under scrutiny. Ethereum is suffering also from the lenght of the process. Although the network can currently handle around fifteen transactions per second, significantly more than Bitcoin, we need only look at the recent Cryptokitties mania to see the crippling effect of high network load.

With the severe limitations proof of work seen, it seems impossible for real-world use cases to succeed. VISA and other non-blockchains handle thousands of transactions per second, and if the many projects emerging in the crypto space are to compete, something needs to change.

Proof-of-Stake game changer

Now, as we enter a new upgraded era of blockchains, the new system of transaction confirmation will be introduced. Instead of powerful miners verifying transactions on the network, users will be able to ‘stake’ their Cryptocurrency. If the stakers act honestly, confirming legitimate transactions, they will be rewarded with interest proportional to their stake. If the stakers act maliciously and try to cheat the system, their stake will be lost. One of the first blockchain platforms to implement this feature is known to be Ardor Blockchain Platform

Major Cryptonews 02 – 06 February 2018

Bitcoin Dips Below $7k Amidst News of China’s Full Ban of Cryptocurrency Exchanges
Bitcoin (BTC) hit a new multi-month low on Monday, Feb. 5, dropping below $7,000 for the first time since the middle of November 2017. According to Cointelegraph’s price index, BTC reached as low as $ 6,661.51 on Monday, losing at least 11 percent of value in the 24 hours to press time, and about 60 percent over the last 30 days. The latest cryptocurrency market decline has likely been caused in large part by the recent news from China that all foreign cryptocurrency exchanges are to be banned by the People’s Bank of China (PBoC): (see next headline)

Ban Complete: China Blocks Foreign Crypto Exchanges To Counter ‘Financial Risks’

China will add offshore cryptocurrency exchanges and ICO websites to its Great Firewall, the South China Morning Post reported Monday, reported Feb. 5, quoting a publication affiliated with the People’s Bank of China (PBoC). Regulators in China reportedly voiced dissatisfaction with current measures restricting trading on domestic exchange sites, coming to a decision to block foreign sites as well to counter “financial risks”.

In January, a fresh crackdown from Beijing saw fringe trading platforms such as P2P and over-the-counter resources banned, adding to a blanket embargo on crypto-to-fiat trading and ICOs in place since September 2017.

Japanese Airline Confirms Future BTC Payment Option In The Works

Peach Aviation, a low-cost airline in Japan, has confirmed that their plan to allow Bitcoin (BTC) as payment is only delayed, not cancelled. Peach Aviation had initially announced in May 2017 that customers would be able to use Bitcoin as a payment method by the end of the year. However, in December 2017, the plan was postponed until March 2018.

Traditional Markets Nosedive, Following Bitcoin’s Own Slump Below $7k

The Dow Jones Industrial Average dropped more than 1,100 points Monday, Feb. 5 experiencing its largest intraday drop since 2011, while Bitcoin (BTC) also dipped below
$7000 for the first time since November. The market dive took place around 2:40 pm EST, with reported trading volume at almost double the 30-day average, according to Bloomberg. The crypto market experienced a similar sharp decline, with 98 out of the top 100 coins listed on CoinMarketCap in the red at press time. The crypto markets had been relatively steadily falling ever since BTC’s December 2017 high of $20,000, but big proponents like John McAfee had been maintaining confidence in both Bitcoin and altcoins. During today’s more drastic dip of both the traditional and crypto markets, McAfee tweeted a graph of the past January dips of Bitcoin, writing that “Bitcoin does this every year at this time”:

What’s Causing The Bitcoin Crash?

A whole slew of bad news has led to a huge downturn in the crypto economy. Bitfinex is drawing the ire of the US Commodity Futures Trading Commission because the exchange site offers users an option to tether their currency to the American dollar. The suspicious thing about that is neither Bitfinex nor Tether can necessarily prove they have enough money in bank accounts to back up the USDT token.
Overseas, India is cracking down on traders. The country’s government is surveying transactions on multiple exchanges in order to try and collect tax revenue. Estimates hint that $3.5 billion in transactions has found its way through India in the last 17 months leading into 2018.

And then there is South Korea. The country has no intention to ban cryptocurrency trading outright. But the government has taken steps to remove anonymity from the equation. South Korean traders must now use their real names.

All of this has contributed to the crypto bloodbath.

How Today’s Stock Markets Crash Will Affect Cryptocurrency Markets

As fear in markets decreases bitcoins price increase. Conversely, as fear increases bitcoins prices decrease. This makes Bitcoin a risk-on investment as opposed to more conservative investments like gold which are considered risk-off investments. It also tells us that in a longer-term bear stock market cryptocurrencies will likely fare even more poorly than their stock counterparts. Conversely, in a bullish market, they will likely fair better. As we now know: market sentiment, more than anything else, drives the price of cryptocurrencies.

Bitcoin Price Falls to 80-Day Low

The downturn reduced the Bitcoin price by another 12 percent, bringing the most prominent cryptocurrency to an 80-day low. At present, the Bitcoin price is valued at just $7,660, which translates into a $130 billion market cap.

Altcoin Markets Plunge

On the whole, altcoins declined to a greater degree than Bitcoin, demonstrating that diversifying into altcoins will not necessarily provide investors with a hedge against major market declines. Both the Ripple price and Bitcoin Cash price declined by 13 percent, reducing the third- and fourth-largest cryptocurrencies to present values of $0.75 and
$1,017, respectively. Fifth-ranked Cardano posted the worst performance of any top 10- cryptocurrenecy, plunging 18 percent to $0.34. EOS and Litecoin, meanwhile, returned single-day declines of 12 percent. Stellar, ranked eighth, declined nine percent for the day, which — demonstrating the severity of the downturn — was the best performance of any cryptocurrency ranked in the top 50, excluding the USD-pegged Tether. NEO and NEM rounded out the top 10 with 24-hour declines of 14 percent and 17 percent, respectively, reducing their prices to $95 and $0.49.

Sources:

https://cointelegraph.com/news/bitcoin-dips-below-7k-amidst-news-of-chinas-full-ban-of- cryptocurrency-exchanges

https://cointelegraph.com/news/ban-complete-china-blocks-foreign-crypto-exchanges-to- counter-financial-risks

https://cointelegraph.com/news/japanese-airline-confirms-future-btc-payment-option-in-the- works

https://cointelegraph.com/news/traditional-markets-nosedive-following-bitcoins-own-slump- below-7k

A History Of Bitcoin Price Collapses Over the Years

How Today’s Stock Markets Crash Will Affect Cryptocurrency Markets

Cryptocurrency Market Cap Retreats Below $400 Billion

https://www.newsbtc.com/2018/02/06/bitcoin-price-watch-heres-trade-mornings-levels/

https://www.newsbtc.com/2018/02/06/alt-coin-analysis-neo-eos-ltc-nem-lumens-2/

https://cointelegraph.com/news/bitcoin-ethereum-bitcoin-cash-ripple-stellar-litecoin-nem- neo-eos-price-analysis-feb-05