Hacked: Hacking Finance


Weekly Analysis: All Eyes on the FED as Cryptocurrencies Shoot for the Moon

Posted on .

Weekly Analysis: All Eyes on the FED as Cryptocurrencies Shoot for the Moon


This article was posted on Sunday, 17:43, UTC.


// -- Discuss and ask questions in our community on Workplace. Don't have an account? Send Jonas Borchgrevink an email -- //
Asset Current Value Weekly Change
S&P 500 2380 1.30%
DAX 12470 2.11%
WTI Crude Oil 49.19 -1.45%
GOLD 1269.50 -1.71%
Bitcoin 1332 9.34%
EUR/USD 1.0898 1.63%


 5 Things to Watch Next Week

  1. Will the FED shock the market?

The consensus among investors is that the FED won’t hike its benchmark rate next week, and the recent weakness in economic numbers makes that even more likely. That said, the central bank was upbeat in recent months, and a surprise rate hike is not out of the question. Stocks and gold could take a hit in the event of a hike, but a cautious monetary statement could propel a new swing higher in the Shiny Metal, and the major indices while pushing the Dollar even lower.

  1. Will Cryptocurrencies keep rising?

The cryptocurrency market remained active this weekend after the week that brought huge moves for almost every major currency. As the mainstream investment world increasingly turns its attention to this segment, volatility is expected to remain elevated, as the stellar returns might continue to attract additional capital. It will be interesting to see if the currencies can hold onto their gains next week or even surge higher.

  1. The strength of the Nasdaq or the weakness of the S&P 500 will dominate?

The relative strength of the US technology index was even more apparent this week, as the benchmark jumped to new all-time highs while the S&P 500 and the Dow remained below their respective maximums. These types of divergences usually don’t last too long, so or the broader market will join the party or bulls will be in for a painful hangover after the post-election euphoria.

  1. Another round of crucial earnings coming up

So far first quarter earnings in the US were much better than expected, and what’s more, stocks reacted well to the positive surprises. Next week Apple, Facebook, Alibaba, Mastercard, and dozens of other companies will release their numbers possibly having a major impact on the market. Although corporate earnings are at a very high level historically, until the global economy keeps growing (thanks in part to the unprecedented central bank measures) there could still be room for growth.

  1. Job’s Friday after the FED

This month’s US employment numbers could be even more crucial for investors than usual, as they will be released just after the Fed’s interest rate decision and monetary statement. As traders expect the central bank to reflect on the slowing growth in the country, another weak report could cause major turmoil before the weekend, especially if the FED turns more cautious. Initial jobless claims have been showing some worrying signs lately, and that might translate to a negative surprise in the coming report.

In Focus: Cryptocurrencies


Weekly performance comparison of the major cryptocurrencies, Hourly Chart

The chart above shows just how strong this week was for the cryptocurrency market, as only Bitcoin advanced by slightly less than 10% since last Sunday, while all the other coins all posted double-digit gains. Ethereum Classic and Ripple rose by more than 80% and 55%, but Ethereum, NEM and Dash are also up significantly. With almost all currencies at or near their long-term highs, traders can choose from several strong trends in the segment. The structure of the market shift continuously, as Bitcoin’s weight is progressively decreasing, despite the new all-time highs in BTC. We are expecting another busy week for the segment, with Dash and Monero edging towards their long-term highs as well this weekend, possibly preparing to follow the explosive break-outs of the other majors.

Currency Weekly Volume Monthly Volume Market Cap
Bitcoin 2,118 9,037 21,514
Ethereum 858 2,787 6,247
Ripple 247 1,072 2,018
Litecoin 336 2,574 814
Dash 99 497 681
Ethereum Classic 230 425 492
NEM 55 100 436
Monero 50 197 331


Key Economic Releases of the Week

Day Country Release Expected Previous
Monday UK Treasury Sec Mnuchin Speaks
Monday GERMANY Personal Spending -0.10% 0.20%
Monday US ISM Manufacturing PMI 56.6 57.2
Tuesday CHINA Manufacturing PMI 51.4 51.2
Tuesday AUSTRALIA Base Interest Rate 1.50% 1.50%
Tuesday UK Manufacturing PMI 54 54.2
Wednesday UK Construction PMI 52.1 52.2
Wednesday EUROZONE Prelim GDP 0.50% 0.40%
Wednesday US Crude Oil Inventories -3.6 million
Wednesday US ADP Employment Report 178,000 263,000
Wednesday US FOMC Statement
Wednesday US Base Interest Rate 1.00% 1.00%
Thursday AUSTRALIA Trade Balance 3.3 bill 3.57 bill
Thursday UK Service PMI 54.6 55.0
Thursday CANADA Trade Balance 0.3 bill -1 bill
Thursday US Initial Jobless Claims (weekly) 246,000 257,000
Thursday US Trade Balance -44.9 bill -43.6 bill
Thursday EUROZONE ECB President Draghi Speaks
Friday CANADA Employment Change 20,000 19,400
Friday CANADA Unemployment Rate 6.70% 6.70%
Friday US Employment Change 194,000 98,000
Friday US Unemployment Rate 4.60% 4.50%
Friday US Hourly Earnings 0.30% 0.20%
Friday US FED Chair Yellen Speaks
Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.

Feedback or Requests?

Mate Cser

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

There are no comments.

View Comments (0) ...
In my last column I suggested that ethusd would be…