Daily Market Analysis and News From NordFX

[Stan NordFX]

CryptoNews

- Forbes compiled a list of the wealthiest representatives of business in the field of cryptocurrency, following the results of 2020. It is headed by the CEO of the Coinbase crypto-exchange Brian Armstrong with $6.5 billion, followed by the head of the FTX cryptocurrency exchange Sam Bankman-Freed with $4.5 billion and the co-founder of Ripple Chris Larsen - $2.9 billion.
The ranking also includes: the head of MicroStrategy Michael Saylor - $ 2 billion, CEO of the Binance exchange Changpeng "CZ" Zhao - $1.9 billion, the founders of the Gemini exchange, the Winklevoss brothers - $1.6 billion each, founder of the venture capital company Digital Currency Group Barry Silbert - $1.5 billion , co-founder and former CTO of Ripple Jed McCaleb - $1.4 billion, venture capitalist Tim Draper - $1.1 billion and co-founder of blockchain startup Bloq Matthew Roszak - $1 billion.
When preparing the rating, the Forbes magazine took into account not only the value of the digital assets of the persons involved, but also their traditional assets, including the shares of various companies.

- According to Reuters, the German prosecutor's office is unable to access a wallet with more than 1,700 bitcoins with a total value of about $75 million. The account holder, who was found to be a fraud, refuses to testify against himself and provide access keys. Currently, law enforcement officers are looking for ways to "get close" to these assets through exchanges and wallet operators in order to return them to the victims of the criminal.
The fraudster was sentenced to two years in prison for installing phishing software on third-party computers, with which he deducted funds from the victims' accounts and transferred them to his own wallet. The prosecutor explained that the offender was offered mitigation of punishment if he provided data on the whereabouts of the coins, but he refused. The size of the criminal's assets has significantly increased against the background of the latest bitcoin rally, and it is possible that he is going to use them after his release.

- American children's charity Songs of Love created Superhero Billy Bitcoin to boost interest in their work. Crypto donations to such non-profit organizations in the United States are tax-free. “Donating in a cryptocurrency like bitcoin is even more efficient than cash. You don't have to pay capital gains tax and can deduct that amount from your taxes,” said Songs of Love. The fund accepts donations in 22 digital assets, and the Superhero Billy Bitcoin is dedicated to supporting children with serious illnesses.

- The price of bitcoin could rise to $100,000 as early as the end of 2021 if other companies follow Tesla's lead, the founder of cryptobank Galaxy Digital Mike Novogratz said in an interview to Bloomberg . Elon Musk's company announced the investment of $1.5 billion in Bitcoin on Monday, February 8. Tesla admitted that in the future they will integrate the first cryptocurrency as a means of payment for their products.
Novogratz called Elon Musk a genius in his decision to listen to people and evaluate the interests of young people. According to the billionaire, other companies will invest in the first cryptocurrency to hedge inflation risks. “You'll see that every company in America will soon start doing the same,” stated Mike Novogratz.

- Due to the shortage of discrete graphics cards in the market, gaming laptops have become popular among Chinese Ethereum miners. As calculated by the Techarp portal, the payback period for such a computer costing from $1000 is approximately three and a half months.
One laptop with a RTX 3060 video card is able to get 0.00053 ETH ($0.92 at the moment) within two hours. That is, the mining will amount to 2.3 ETH (over $4000) for the year, and a farm of 20 laptops at current prices and taking into account the cost of electricity in China will bring more than $76,800 in profit.

- North Korea has been able to upgrade its nuclear weapons and ballistic missiles by using funds stolen in cyberattacks, to finance. According to the Associated Press citing UN experts, these attacks mainly targeted financial institutions and cryptocurrency platforms, and the total amount of the digital assets stolen in the period from 2019 to November 2020 is more than $316 million. Experts say North Korea continues to launder cryptocurrencies stolen by its hackers mostly through Chinese over-the-counter platforms.

- The authorities arrested a 37-year-old Wisconsin resident on charges of attempting to arrange a bespoke homicide. This is stated in the message of the US Department of Justice. The woman found the killer on the darknet, offering to pay for his "work" in cryptocurrency, and provided him with a phone number, place of work and a description of the alleged victim.
Journalists of one of the media learned about the upcoming crime while working on material about transactions in the darknet. They found evidence of a Bitcoin transaction, as well as a screenshot of a wallet with $5,633 in cryptocurrency, after which the reporters contacted the law enforcement. Now the alleged customer faces up to 10 years in prison.

- One of Mexico's richest people (the fortune of $11.7 billion) and founder of Grupo Salinas group of companies Ricardo Salinas Pliego added a Bitcoin hashtag to his Twitter account description. Recall that the founder of Tesla and SpaceX Elon Musk did the same in January, after which the asset rose to $38,000.
Earlier Pliego admitted in a Cointelegraph commentary that he first bought digital gold in 2013. He sold the asset at $17,000 during a bull rally in 2017 and called the bitcoin “the best investment of all time.”

- Specialists of financial and investment company Guggenheim Partners said that the value of bitcoin could reach $600,000. According to the company's investment director, Scott Minerd, everything will depend on the number of coins in the public domain. “Cryptocurrency can rise to very high values. It is possible that we are talking about 400 or even $600,000 per coin. We have been studying the asset for almost ten years, so we understand how it will behave. Bitcoin used to be unjustified for institutional investors, but now everything has changed,” Minerd said.
According to the specialist, the concern is caused by the rapid growth of the asset in the past few weeks. It is possible that we are talking about speculation, in which institutional investors capable of large investments to manage the value of the coin are involved. At present, bitcoin is in a difficult situation, as the departure of large investors will lead to a return of the negative trend. According to Minerd, such a development is unlikely, but it should definitely be taken into account.


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[Stan NordFX]

Forex Forecast and Cryptocurrencies Forecast for February 15 - 19, 2021​

First, a review of last week’s events:

- EUR/USD. It often happens that monthly forecasts come true faster than weekly ones. That was what happened this time as well. Recall that only 30% of experts expected the EUR/USD pair to grow in the weekly perspective. In the transition to the monthly forecast, those were in majority already, 60%.
We started talking about the paradoxes of the relationship between stock indices and the dollar seven days ago. With the outbreak of the pandemic at the end of last February, an inverse correlation was clearly visible between them: thanks to fiscal stimulus (QE), lower interest rates and pumping the US economy with cheap money, the S&P500, Dow Jones and Nasdaq stock indices went up, and the DXY dollar index - way down. And that was logical.
And here came 2021, and everything turned upside down. Against the backdrop of good economic data and expectations of a new injection of financial "vaccine" for almost $2 trillion, the growth of risk sentiment and stock indices continued. But in parallel, the yield of long-term US Treasury bonds and the dollar grew.
But the surprises with overturns did not end there. Based on the same fiscal incentives and rapid vaccination in the United States, Wall Street Journal experts are raising their forecasts for US GDP for 2021 from 4.3% to 4.9%. In Europe, the opposite is true: there are a lot of delays with vaccination, the EU countries, one after another, are tightening anti-covid measures once again, there is no end in sight to lockdowns. As a result, the European Commission lowers its forecast for the Eurozone economy to 3.9%. But at the same time, the euro is growing, and the American currency is falling.
According to a number of experts, it's all about the long-term policy of the US Fed, which is not going to wind down the QE program until the end of 2021 and will not raise interest rates on the dollar earlier than 2023. This should lead to the recovery of not only the American but also the global economy, including the EU, making the euro a reasonably attractive currency for some, primarily Chinese, investors. China's interests in Europe are great, and appetites are constantly growing, which supports the demand for a pan-European currency.
As a result, having started at 1.2050, the EUR/USD pair rose by 100 pips and reached a weekly high at 1.2150 on Thursday, February 11. This was followed by a correction and a finish at 1.2120;

- GBP/USD. The released macro statistics looks quite contradictory. Due to the coronavirus pandemic, investment cuts and Brexit problems, UK GDP contracted 9.9% which is a record drop in more than 300 years. At the same time, monthly and quarterly GDP were better than expectations. GDP growth in Q4 2020 amounted to +1%. Industrial production figures were lower than forecasted, but the trade balance report pleased investors.
Solid monetary policy of the Bank of England, positive interest rate, and the first in Europe and third in the world (after Israel and the UAE) in terms of vaccination rates also played on the side of the pound. At the time of writing this review, 20.67% of the country's population was already vaccinated (the figure in the USA is 14.02%).
Recall that the majority of analysts (65%) also sided with the British currency. The main forecast assumed that the pair would succeed, having broken through the resistance at 1.3750, to rise to the height of 1.3800, and possibly 25-50 points higher. And so it all happened: the high of the week was fixed at 1.3865, and the last chord of the GBP/USD pair set at 1.3850.

- USD/JPY. The movement of this pair in most cases depends on what is happening not in Japan, but in the United States, on where stock indices, as well as the yield of American state bonds and the DXY dollar index are moving. This happened last week as well.
DXY climbed to 91.21, USD/JPY grew to 105.66 on February 8. On February 10, the dollar index dropped to 90.26, followed by a bottom at 104.40. On February 12, we see an increase in the DXY to 90.71 and an increase in USD/JPY to 105.17, then a slight drop: in the index to 90.39, in the pair to 104.95. So, if anyone wants to try the DXY as a leading indicator for this pair, they can try it;

- cryptocurrencies. At the end of 2020, Forbes compiled a list of the wealthiest representatives of the cryptocurrency business with capitals of over $1 billion. The top three included Coinbase CEO Brian Armstrong with $6.5 billion, FTX head Sam Bankman-Fried with $4.5 billion and Ripple co-founder Chris Larsen with $2.9 billion. In total, Forbes counted 11 billionaires, although, given the rise in the price of digital assets in January-February, there may have already been more of them. Suffice it to say that the total cryptocurrency market capitalization increased by 87% in less than a month and a half in 2021, from $776 billion to $1,452 billion.
The past week was one of the most successful this year. The rally began with the news that Tesla bought $1.5 billion of bitcoins. At the same time, its head, Elon Musk, said that he plans to sell cars of this brand for cryptocurrency in the near future. Bitcoin went up in price by 23% on this news, on February 8.
But this did not end there. Global payments giant MasterCard has announced that it plans to provide merchants with the ability to receive payments in cryptocurrency starting later this year. As a result, bitcoin once again renewed all-time highs, reaching $48,930 in the afternoon of Friday, February 12. The capitalization of BTC has risen to $885 billion at the moment and exceeded the volume of the money supply of such a large country as Russia, for the first time.
The Crypto Fear & Greed Index has reached 92 (it was 81 a week ago) and is in the overbought zone. At the same time, the BTC Dominance Index has decreased from 70.36% to 61.06% since the year started. But, according to many experts, this does not indicate a deterioration in investor attitudes towards bitcoin, but an improvement in their attitude towards altcoins.
So, the Chicago Mercantile Exchange (CME) launched trading in Ethereum futures on Monday, February 08. The turnover reached $30 million on the very first day, and the open interest - $ 20 million, which indicates the stable interest of investors in this token. The capitalization of ETH has increased by 32% since the year started and amounts to more than $203 billion as of February 12.
Another top coin that we have already paid attention to in the previous review is Litecoin. Over the past three months, aggregate open interest in LTC futures has grown by 285% to $584 million. And, although the share of Litecoin in the total cryptocurrency market capitalization is quite small (8th place with 0.85%), it now occupies an honorable 3rd place among derivatives after bitcoin and Ethereum.

continued below...

 

[Stan NordFX]

As for the forecast for the coming week, summarizing the views of a number of experts, as well as forecasts made on the basis of a variety of methods of technical and graphical analysis, we can say the following:

- EUR/USD. Throughout the coming week, China is celebrating the New Year, which will cause a significant portion of trade volumes to leave the global markets. However, this does not at all promise a calm or a decrease in volatility. Although right now, investors are at a crossroads. US stock indices, after a powerful upward leap in January, have gradually moved to consolidation and look overbought. No surprises are expected from the Fed any time soon, and the report of the Open Market Committee meeting on Thursday February 18 is likely to be boring enough. On the same day, the report on the ECB meeting on monetary policy will be released, but it will be highly likely filled mostly with general streamlined phrases. Therefore, the main drivers for the EUR/USD pair will again be news about the successes in the fight against the Covid-19 pandemic on both sides of the Atlantic Ocean.
As for experts, 60% of them, together with graphical analysis for H4 and D1, expect the pair to decline, at least, to support 1.2050. In case of a breakout, the next target for the bears will be the February 05 low at 1.1950. The nearest support is in the 1.2100 zone.
40% of analysts adhere to the opposite scenario. However, when moving from weekly to monthly forecast, the number of bulls' supporters increases to 60%. 85% of trend indicators on H4 and D1 are also painted green. But the readings of the oscillators on both timeframes cannot be analyzed: there is complete chaos of red, green and neutral gray colors there. The nearest resistance level is 1.2150. The bulls' targets are first a return of the pair to the 1.2200-1.2300 zone, and then the January high at 1.2350.
As for the economic calendar of the week, in addition to the already mentioned meetings of the Fed and the ECB, we are waiting for: on Tuesday, February 16 - data on GDP of the Eurozone, on Wednesday, February 17 - data on retail sales in the United States (a noticeable increase from -0.7% to + 0.7% is expected), and at the end of the working week, on Friday, February 19, statistics on business activity of Markit in Germany and the EU will be published (here, although not so noticeable, but still growth is predicted);

- GBP/USD. A quarterly GDP growth of 1% means that the country has every chance of getting out of the recession. The high rates of vaccination will also contribute to this (although there are concerns about new strains of coronavirus). Prime Minister Boris Johnson plans to unveil a plan to exit the quarantine towards the end of the month, or rather February 22, which should clarify the prospects for the recovery of the UK economy.
In the meantime, analysts' votes have been distributed as follows: the pound has reached 34-month highs, and 45% of experts believe that it would be time for it to stop and play back a little down. 20% vote for the continued growth of the pair, while the remaining 35% take a neutral position. 100% of trend indicators and 75% of oscillators on H4 and D1, together with graphical analysis on H4, point north, targets are 1.3900 and 1.3950. The remaining 25% of the oscillators give signals that the pair is overbought.
As for the graphical analysis on D1, it shows a rebound from the resistance of 1.3865 and the decline first to support in the zone 1.3700, then 1.3630 and 1.3575.
As for economic statistics, one should pay attention to data on the UK consumer market, which will be released on Wednesday February 17, and business activity in the service sector on Friday February 19;

- USD/JPY. Graphical analysis on D1 predicts the movement of the pair in the channel along the Pivot Point 104.85 during the month. Moreover, it will first rise to the upper border of the channel at 105.75, and then descend to its lower border at 104.40. On H4, the oscillation amplitude is naturally less, from 104.85 to 105.30.
Apart from the green colored 75% of the trend indicators on D1, the readings of the other indicators and oscillators look quite confusing. It is also difficult to draw any conclusions from the opinions of experts, who are divided almost equally: 40% for the growth of the pair, 30% for its fall and the same amount for the sideways movement.
The GDP data for the IV quarter of 2020, which the Japanese Cabinet of Ministers will publish on Monday February 15, may somehow influence the formation of the short-term trend of the USD/JPY pair, especially if this indicator differs greatly from the forecasted +2.3%;

- cryptocurrencies. We wrote about bitcoin's readiness to storm the $50,000 high two weeks ago. And its rise to $48,930 on February 12 is a clear confirmation of the correctness of this forecast, which is supported by 80% of experts in a monthly perspective.
The growth of bitcoin and other top coins pulls up the entire crypto market. Its members look forward to following the example of Tesla and MasterCard and other S& P500 companies listed on the NYSE to announce their readiness to work with digital assets. As, for example, did the Bank of New York Mellon, which said it would allow digital currencies to pass through the same financial network that it uses for traditional financial assets.
The fact that every company in America will soon follow the example of Tesla, was mentioned by the founder of the crypto bank Galaxy Digital Mike Novogratz in an interview with Bloomberg. According to the billionaire, this will help bitcoin grow to $100,000 by the end of this year.
In the longer term, the BTC/USD pair may rise even to $600,000. At least, this is the opinion of specialists of the financial and investment company Guggenheim Partners. According to the company's investment director, Scott Minerd, everything will depend on the number of coins in the public domain. “Cryptocurrency can rise to very high values. It is possible that we are talking about 400 or even $600,000 per coin... Bitcoin used to be unjustified for institutional investors, but now everything has changed,” Minerd said.
According to the specialist, the concern is caused by the rapid growth of the asset in the past few weeks. It is possible that we are talking about speculation in which institutional investors are involved, capable to manage the value of the coin with the help of large investments. So far, bitcoin is in a difficult situation, as the departure of large depositors will lead to a return of the negative trend. This development of events is unlikely, says the director of Guggenheim Partners, but it should definitely be taken into account.


NordFX Analytical Group


Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

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[Stan NordFX]

CryptoNews

- Kiss bassist Gene Simmons invested a seven-figure sum in bitcoin. According to him, he bought the cryptocurrency several months ago at a time when it was almost twice as cheap as it is now. Simmons did not name the exact amount of the investment but noted that he had already managed to seriously increase his capital.
“Many people wonder if I believe in a further growth in the value of bitcoin. Of course, I do. Otherwise, I would not have spent money on a dubious asset. The future has already arrived, and new tools for earning and storing savings are appearing in our lives,” Simmons explained.

- Lisa Edwards, sister of self-proclaimed bitcoin creator Craig Wright, predicted that the first cryptocurrency would rise to $142,000. Based on Elliott Wave Theory, she suggested that digital gold would rise to $90,000 by May 2021, decline to $55,000 by January 2022, and skyrocketing to $142,000 in March 2023. After that, according to Edwards, the cryptocurrency market expects a bearish trend.
“Satoshi Nakamoto did not consider supply and demand. In a closed market with high demand and limited supply, the price can increase in large leaps, leading to significant increases in short periods,” she wrote.

- As the CoinDesk publication reports, the income of bitcoin miners over the past week reached a new maximum of $354 million against the background of the movement of the first cryptocurrency to the $50,000 mark. The previous record figure in seven days was $340 million and was recorded in December 2017.

- BNY Mellon, the oldest bank in the United States, announced the start of work with bitcoin and other digital assets through the launch of a new cryptocurrency storage service. According to CNBC, the bank will allow cryptocurrencies to pass through the same financial network that it currently uses for traditional assets like treasuries and stocks.
Roman Regelman, head of digital at BNY Mellon, said the financial institution is proud to be the first global bank to announce plans to provide integrated services for crypto assets. He noted that the bank will be able to start offering these services to clients this year.

- Another major US bank, JPMorgan Chase is ready to support bitcoin trading if clients are interested in it, announced the bank's co-president and chief operating officer Daniel Pinto. “If, over time, an asset class develops that will be used by various managers and investors, we will have to get involved,” he told CNBC. "There is no demand yet, but I'm sure it will appear at some point."
It became known that JPMorgan Chase organized a virtual meeting in January with the participation of thousands of traders and sales professionals from different parts of the world, during which it inquired about their interest in trading BTC.
Last week, according to CNBC, another bank, Goldman Sachs, convened a closed forum for employees and clients with the participation of Galaxy Digital CEO Mike Novogratz, where he spoke about bitcoin, Ethereum and other digital assets.

- The owner of the Vietnamese Internet cafe Star Computer has redesigned the business to mine Ethereum. The idea came to the entrepreneur after the number of visitors to the computer club dropped markedly due to restrictions associated with the COVID-19 pandemic. “I am changing the business model: the profit is higher than from the main activity,” he announced.

- Bloomberg said that the founder of Telegram Pavel Durov bought $750 worth of bitcoins about four years ago. According to the publication, after the sale of a stake in the social network VKontakte he founded, the entrepreneur left Russia, owning $300 million and 2,000 BTC. At the moment, the cost of his initial investment in the leading cryptocurrency has reached $100 million.

- Another piece of news regarding Telegram. Telecommunications company T-Mobile has become a defendant in the lawsuit. California resident Calvin Cheng has filed a lawsuit in New York City after losing $450,000 as a result of SIM swapping - an account hack through SIM swapping.
According to Cheng, he acquired the cryptocurrency by negotiating via the Telegram messenger and using a crypto exchange operated by Iterative Capital. A few months later, in May 2020, he received a message, also via Telegram, from the phone number of Iterative Capital co-founder Brandon Buchanan. He offered a higher price for 15 bitcoins. Cheng transferred the cryptocurrency to the specified wallet, but the money for bitcoins never arrived. A few days later, Buchanan notified customers that his accounts had been hacked using SIM swapping.
The co-founder of Iterative Capital used the services of T-Mobile, and Cheng believes that the company violated obligations to protect the personal and financial information of customers, and, in addition, was negligent in hiring and training support staff, and therefore it is obliged to reimburse him for the losses incurred.

- UK police, with the support of Europol, have arrested eight suspects in SIM card fraud. According to law enforcement officers, fraudsters have stolen money and crypto assets worth $100 million. The attacks were carried out throughout 2020 from the UK, and the victims of the scammers living in the United States were "famous influencers, sports stars, musicians and their families."
Fraudsters uploaded identification information from SIM cards of victims' phones to their cards, thus gaining control over their crypto wallets and bank accounts.

- It became known that the Mayor of Miami (USA) Francis Suarez has already taken a number of steps to legalize cryptocurrency as an investment and payment instrument. “We have made bitcoin an available currency for potential investors. In addition, employees can receive salaries in cryptocurrency, which is a huge step forward,” he wrote on Twitter.
New York Mayor and former presidential candidate Andrew Young and Reno, Nevada Mayor Hillary Shiv supported Suarez's decision. And Andrew Young said that he would try to make the financial centre of the world become a centre for cryptocurrencies.
According to a number of experts, such steps and statements by US politicians and officials have a positive impact on the price of bitcoin and other cryptocurrencies.


#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

 

[Stan NordFX]

Forex Trend Indicators: Destination, Features, Varieties​

Finding patterns, repeatability and historical cyclicality is one of the main tasks of a trader. Some use graphic patterns to look for the silhouettes of geometric shapes. Some study the characteristic price movements: acceleration, braking, and interaction with graphic objects. However, there is a huge category of traders who are engaged in technical analysis of Forex using indicators. They allow you to predict the market, study its various characteristics and use these patterns in your own trading. Even beginners who have just heard about the existence of technical analysis will be able to analyze the market with their help.

One of the largest categories of the entire variety of instruments is Forex trend indicators. They are based on a simple pattern of price movement, namely, the tendency to trend movements. A trend is a forward movement of the price up or down, in which the rewriting of extremes is characteristic. It is formed under the influence of majority positions in the market when there is a prolonged imbalance between buyers and sellers.

By identifying a trend, you shift the likelihood of success of the trade to your own direction. We will tell you in this article what Forex trend indicators are used for, what you should pay attention to when working with them, and what place they can take in the trading system.

Purpose and Methods of Using Trend Indicators

The overwhelming majority of books on technical analysis are based on the fact that the trend is the basis around which strategies are built. You should always stick to its direction and open trades in its direction. A trader must be able to identify it and build trading in its direction. However, it is difficult to determine it in a timely manner and without errors.

This is due to market noise, which blur the overall picture of what is happening. Trend indicators were created to combat it, that, depending on the formula embedded in them, average the price or in other ways indicate the global price movement, helping to determine the direction of future transactions.

Most often, their use is reduced to the filter function in the strategy, when the signals from the oscillator are matched with a global trend. For example, it can be a bundle of EMA and Stochastic, RSI, any other indicators of building channels and levels can be used. If they match in their readings, a trade is opened, and in case of a discrepancy, a trade should not be opened.

In addition to the filter, they can give signals to enter the market. This could be both a change in global and short-term trends. One way or another, indicators of this type can be a source of data for opening future positions by a trader.

In some cases, trend indicators can also be used to set Stop Loss. A prime example is setting a stop order under EMA, where the indicator line is the main pointer to limit risk.

Three Main Trend Indicators

Technical Analysis is world famous for its range of instruments around the world. A huge number of custom developments allows you to create a wide variety of trading systems. As mentioned above, a trader can take any trend-type instrument as a basis and attach an RSI indicator or any other oscillator to it. As a result, you get a balanced basis for developing a trading strategy.

The following TOP-3 trend indicators on Forex can be distinguished among all the tools that the MetaTrader terminal allows you to use. This is Moving Average, MACD, Bollinger Bands. They are present by default in all existing terminals and are considered standard. By the way, NordFX broker allows you to work with them through the MT4 terminal, which can be installed not only on a computer, but even on your mobile phone.

Moving Average Review

The Moving Average indicator is a classic trend indicator that draws a price line on a chart by averaging its value over a specified number of candles. SMA is considered a basic tool for technical analysis. First, it is a medium-arithmetic value, easy to calculate, and therefore was created one of the first. Secondly, many modifications and other indicators have been created on its basis. Thirdly, a trader can implement absolutely any strategy on its basis (Fig. 1).

There are several types of moving averages:

1. Simple moving average (SMA);
2. Exponential Moving Average (EMA);
3. Weighted moving average (WMA).

It is difficult to see the difference between them at a first glance. The fact is that they differ in the type of price averaging, which entails some differences in sensitivity and lag. The last one on the list is the slowest and roughest of market noise. EMA is on the contrary the fastest and is more commonly used in practice.

The line you see on your chart can generate the following signals:

1. Crossing of the line and the price;
2. Crossing of the moving average lines between each other;
3. Average with a large period as a line of support and resistance.

We also want to pay attention to the angles of inclination and the position of price relative to the line. If it is above the line, the current trend is upward, if it is below the line, it is downward. It is worth reminding once again that in strategies Moving Average is almost always used in tandem with oscillators: Stochastic, RSI and others, which help to determine the beginning, continuation or end of the current trend.

A simple example of how the Stochastic indicator exits the overbought zone confirms a downtrend in the SMA and gives a command to open a sell trade is shown in Figure 2 below:

 

[Stan NordFX]

MACD Overview

This indicator is sometimes mistakenly considered an oscillator. This is not the case, because it is based on price averaging. The MACD algorithm is based on the convergence and divergence of two Moving Averages, and the histogram shows the distance between them. So MACD, unlike Stochastic or RSI, is not a stochastic oscillator, but a classic trend indicator (Fig. 3).

It is a huge source of signals, as it is able to find short-term and medium-term changes of the trend, generate signals to change the global trend. Its most formidable weapon is divergence. It has become a common signal for a huge number of Forex indicators.

Divergence is a reversal type of signal that is formed due to the mismatch of the extremes of the instrument with the real price. Simply put, if the price curve is still going down, and the indicator curve has already turned upstairs, this is a strong signal that the trend reversal should soon be expected. Thus, MACD, like other reversal indicators, is able not to post facto, but to warn in advance about fractures in price movements. The example is given in Figure 4:

You can see divisions above and below the 0.00 mark on the histogram. At moments when the graph crosses this zero line, a global trend change is fixed. It is clear that if the intersection occurs from bottom up, then the trend has changed from downward to rising. Accordingly, at the reverse level crossing, the trend changes from ascending to descending.

Also note how the MACD histogram interacts with the signal red dotted line. Their intersection generates a signal of a short-term change in the price movement and helps to determine the moment for opening orders either for buy or sell (Fig. 5).

Some Forex traders use this indicator not only together with other technical analysis tools, but also on their own. This is explained by the strength and accuracy of the MACD signals, especially if divergence occurs on the chart.

Bollinger Bands Review

Bollinger Bands round out the top three Forex trend indicators. They are an ordinary moving average, at a distance from which a trading range is built. It is interesting that this indicator is able to find and give the trader information not only about the direction of the trend, but also about the market volatility, as well as give signals to pull back from the boundaries of the range (Fig. 6).

Bollinger Bands demonstrate the strength and potential of the trend with its range. When the channel narrows, a transition from trend to flat or accumulation stage should be expected. Expansion, on the other hand, indicates an increase in volatility and trend activity. Trading can be based on the interaction of the indicator lines and the price, which can bounce back from them, break them or test them. This allows you to trade either on the break, or on the breakdown of the range. Both options will be correct. An example of how the Relative Strength Index indicator works in tandem with Bollinger Bands to rebound from the range boundaries can be seen in Fig. 7:

Strengths and Weaknesses

The strong point of trend indicators is the ability to cut off minor price fluctuations and identify the main trend of its movement. Фlmost all trend instruments use the averaging algorithm to combat market noise. On the one hand, it frees you from noise, makes the market picture clearer and more understandable. On the other side of the scale is the signal delay. Moreover, the more noise the indicator cuts off, the more delayed its signals.

It should also be borne in mind that signals such as, for example, divergence, can occur quite rarely. Therefore, having missed one such signal, you can wait a long time for the next one to appear. Especially if you trade on large time frames.

However, the usefulness and effectiveness of Forex trend indicators is beyond doubt. They allow not to be mistaken with the global direction of the price, due to which they are able to become the basis of a high-quality trading strategy and bring stable profits both in manual trading and in automatic trading with the help of robot advisors.


Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

 

[Stan NordFX]

Forex Forecast and Cryptocurrencies Forecast for February 22 - 26, 2021​

First, a review of last week’s events:

- EUR/USD. The sharp rise in bond yields in the US and Europe has hit not only the stock market, but also the “carry trade”, providing support to funding currencies, primarily the euro and the US dollar. Recall that the funding currency is usually a currency with a low interest rate. Implementing the carry trade strategy, traders borrow it and then deposit it in another currency, such as developing countries, with a higher rate. And now the fall in risk sentiment has led to an exit from such deals, and the strengthening of both EUR and USD. Apparently, this can explain the consolidation of this pair. And if the preponderance was on the side of the dollar in the first half of the week, then, investors began to buy up the cheaper euro starting from Wednesday, February 17. As a result, having started the week at the level of 1.2120, the EUR/USD pair ended it almost there, at the level of 1.2115;

- GBP/USD. The pound continues to push north, approaching the 2018 highs. The pair broke through the psychologically important level of 1.4000 on Friday, February 19, recording a weekly high at the height of 1.4035. It completed the trading session at the same level 1.4000, after a slight rebound.
The American currency lost to the British one amid weak data from the US labor market. Investors expected a decrease in the number of initial applications for unemployment benefits from 848 thousand to 765 thousand, while, on the contrary, it rose to 861 thousand over the week. The number of secondary applications was not encouraging either, it decreased from 4.558 million to 4.494 million, instead of the forecasted 4.413 million. Investors were fast to recall the statements of the FRS officials that it would take more than one year to return the labor market to the previous levels, and that it was necessary to take new measures to support the US economy.
But the data on the consumer market and business activity, released in the UK last week, looked pretty good. The Markit index in February was at 49.7 against 39.5, only slightly short of 50, the threshold that separates growth in economic activity from its fall. These figures have once again strengthened the confidence of buyers of the British currency that the Bank of England will refrain from allocating new funds under QE and from cutting the interest rate. As a result, the GBP/USD pair went further up, taking the next important milestone - 1.4000;

- USD/JPY. The main trends of this pair, as well as EUR/USD, were determined last week by disappointing data from the US labor market and a sharp rise in government bond yields. The Japanese GDP data released on Monday 15 February, although was significantly better than the forecast (3.0% versus 2.3%), had no effect on market sentiment, once again showing that the rate of this pair is being formed in the USA.
Recall that the opinions of experts last week were divided almost equally: 40% supported the growth of the pair, 30% were for its fall and as much for lateral movement. And, in general, everyone turned out to be right. The pair grew for the first half of the week, reaching a height of 106.20, then it fell, and the finish of the five-day period took place near the place where it had already started on February 08 - at 105.40;

- cryptocurrencies. As we predicted, bitcoin has hit the $50,000 bar and is quoted at $55,000 at the time of writing. Starting from February 01, the main cryptocurrency added about 60% in weight, the growth of Ethereum (ETH/USD) amounted to a little less than 50%, the leader in this three was Litecoin (LTC/USD) with 80%.
In general, the situation for the digital market is quite positive. Even conservative structures such as American banks have turned their views in its direction. The oldest US bank, BNY Mellon, has announced the start of work with bitcoin and other digital assets. Another major US bank, JPMorgan Chase, is also ready to support bitcoin trading. It became known that JPMorgan Chase organized a virtual meeting in January with the participation of thousands of traders and sales professionals from different parts of the world, during which it inquired about their interest in trading BTC. And last week, another bank, Goldman Sachs, held a closed forum for employees and customers on the topic of cryptocurrencies, at which the speaker was Mike Novogratz, CEO of Galaxy Digital.
The statements of a number of US politicians and officials also have a positive impact on the price of digital assets. For example, Miami Mayor Francis Suarez announced that he had already taken a number of steps to legalize cryptocurrency. “We have made bitcoin an available currency for potential investors. In addition, employees can receive salaries in cryptocurrency, which is a huge step forward,” he wrote on Twitter. Candidate for mayor of New York and former candidate for US President Andrew Young supported his colleague, saying that he will try to make the financial center of the world become a center for cryptocurrencies as well. And St. Louis Fed chief James Bullard called bitcoin a rival for gold.
Institutional investors continue to buy both cryptocurrencies and shares of miners and crypto funds. So, the Grayscale Investments fund added 20,000 ETH to its Ethereum portfolio last week, bringing its volume to $6 billion. Another impetus for the growth of the BTC/USD pair was MicroStrategy's decision to raise another $900 million to buy bitcoins.
Overall, the supply / demand ratio remains in favor of bitcoin: 150,000 BTC coins were mined and almost 360,000 were bought back over the last five months of 2020, and investors hope that this balance will continue in the future.
At the same time, buyers look at the head of Tesla Elon Musk, whose tweets alone push the quotes sharply upward. However, the US Securities and Exchange Commission (SEC) is now interested in his "creativity" on Twitter, considering that the billionaire's calls to buy digital assets fall under the law on the offer and advertising of securities and can be regarded as unregistered brokerage activities and attempts to manipulate the market. If proven, Elon Musk could face huge fines. In the meantime, the entrepreneur said that he was taking a break and would no longer post tweets, at least in the near future.
As for the total cryptocurrency market capitalization, even without Musk's tweets, it grew over the week from $1,458 billion to $1,625 billion. And the Crypto Fear & Greed Index is slowly but inexorably approaching its maximum value of 100 points. It has now reached 93, which indicates a strong overheating of the market.

continued below...

 

[Stan NordFX]

As for the forecast for the coming week, summarizing the views of a number of experts, as well as forecasts made on the basis of a variety of methods of technical and graphical analysis, we can say the following:

- EUR/USD. The European Union is still under blockade of restrictions due to the COVID-19 pandemic. But in the United States, not everything is as rosy as expected. Weak data on the labor market, the growth of initial applications for unemployment benefits put pressure on the dollar.
It can be understood from the statements of ECB executives that even if bond yields in Europe continue to rise, the bank is unlikely to increase the volume of the quantitative easing (QE) programme. Officials from the Governing Council of the ECB believe that the measures they have taken are quite sufficient, it just takes some time for them to have the maximum positive effect.
The situation is exactly the opposite on the other side of the Atlantic Ocean. Judging by Treasury Secretary Janet Yellen's appeals to the US Congress and the Federal Reserve minutes published on February 18, QE volumes will continue to increase. The soft monetary policy will continue until the economy of this country shows steady growth. The next measure will be the adoption of another stimulus package worth $1.9 trillion.
In such a situation it is logical to expect a weakening of the dollar in the medium term, and the rise of the EUR/USD pair first to the zone of 1.2200-1.2300, and then return to the January high of 1.2350. 65% of analysts agree with this scenario. But as for the weekly forecast, the picture is different.
The majority (70%) of experts believe that the pair should retest the support in the 1.2020 zone in the near future and try to reach the February 05 low of 1.1955. This bearish development is supported by 15% of the oscillators on H4 and D1, which give signals that the pair is overbought.
The rest of the oscillators, as well as 75% of the trend indicators, are colored green. But graphical analysis on both time frames draws consolidation in the range 1.2020-1.2155.
As for the events of the week, here the speeches of the head of the ECB Christine Lagarde on Monday 22 February and the head of the Federal Reserve Jerome Powell in the US Congress on Wednesday 24 February are of interest, as well as annual data on GDP and the volume of orders for capital and durable goods in the United States to be published on Thursday 25 February;

- GBP/USD. It is clear that 100% of the trend indicators and 85% of oscillators on H4 and D1 point north. The remaining 15% of the oscillators give signals that the pair is overbought. The overwhelming majority of analysts (75%) are also awaiting a correction to the south. True, in their opinion, this may not happen in the coming week, but in the first half of March. Support levels are 1.3950, 1.3850, 1.3775, 1.3600.
The potential for British currency growth has not yet been exhausted so far. And everything will depend on whose structural problems, the US or the UK, will put more pressure on their national currencies. This refers not only to quantitative easing and interest rates, but also the issue and yield of government securities, as well as the risk of high inflation due to excessively high budget spending.
We outlined in the first part of the review how the data from the US labor market affected the pair's behavior. Similar macro statistics on the UK labour market are expected to be released in the coming week, on Tuesday 23 February. And if it looks quite optimistic, you can expect the continuation of the uptrend of the GBP/USD pair. Other events include a speech by the British Prime Minister the day before. Although, most likely, Boris Johnson will do without much specifics, and will enthusiastically talk about the successes of his Cabinet in the fight against the pandemic, the record pace of vaccinations, and how relations with the EU are developing after Brexit;

- USD/JPY ... 104.40-105.40 is the zone that the pair has visited many times over the past 30 weeks. This allows us to speak of it as the Pivot Point of the medium-term sideways channel 102.60-107.00. By the way, the maximum trading range of 440 points on the semi-annual segment is actually not so great. In October, for example, the pair made 240-point throws in just one day.
At the moment, only 35% of experts believe that the pair has not yet completed its movement to the upper border of this trading range. True, 75% of oscillators and 80% of trend indicators on D1 are on their side, which gives additional weight to this forecast. Resistance levels are 105.70, 106.20, the target is 107.00.
The opposite view is held by 65% of analysts, with the number rising to 80% when moving from a weekly to a monthly forecast. They have a similar number of indicators on their side, on H4 this time. Support levels are 105.00, 104.40, 103.60, the target is 102.60.
Graphical analysis shows fluctuations of the pair in the trading range 104.40-106.20 with a predominance of bearish sentiment.

- cryptocurrencies. As bitcoin prices grow, there are fewer buyers in the market. The most cautious ones left back in December, when the coin reached its previous all-time high of $20,000. The next phase of closing long positions followed after bitcoin's rise to $40,000. Only the most die-hard investors and crypto fans have made it to the $50,000 level.
Bitcoin is overbought. But after the price stepped over $55,000 on Friday evening February 19, there was no active sale. The market froze in anticipation. Alarming signals are already coming, though.
First, the share of sellers is growing, which has increased from 18% to 35% over the past two weeks. Second, about 2/3 of traders buy perpetual futures contracts using leverage, resulting in higher funding rates and commission costs while maintaining long positions. And third, the shares of miners went down.
According to CoinDesk, weekly earnings of bitcoin miners reached a new high of $354 million from February 08 to 14. The previous record figure in seven days was $340 million and was recorded in December 2017. But despite this positive, for example, Riot Blockchain Inc shares lost 20% in price only on February 18.
However, according to a number of experts, it is not worth waiting for the onset of a new crypto winter. Though it may be a deep one, it is just a correction. Moreover, at small volumes there is a probability of growth of bitcoin up to $60,000-65,000 even by inertia. And there, a new wave of purchases can be triggered by FOMO - Lost Profit Syndrome (Fear Of Missing Out). After all, fear and greed are known to drive the market.
Lisa Edwards, sister of self-proclaimed bitcoin creator Craig Wright, has predicted that the first cryptocurrency would rise to $142,000. Based on Elliott Wave Theory, she suggested that digital gold would rise to $90,000 by May 2021, decline to $55,000 by January 2022, and skyrocketing to $142,000 in March 2023. After that, according to Edwards, the cryptocurrency market expects a bearish trend.
But even though the growth of the BTC/USD pair may continue in the near future, you need to be very cautious about purchases at current levels. Most analysts consider them to be quite risky and suggest waiting for a rollback, and only then open new long positions.


NordFX Analytical Group


Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is risky and can lead to a loss of money deposited.

#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market

 

[Stan NordFX]

CryptoNews

- After bitcoin hit an all-time high of $58,275 on February 21, investors were looking forward to taking the $60,000 high. However, there was a sudden reversal and a sharp drop of 23% to $44,985. According to many experts, the trigger of the massive profit fixation by "whales" was the statement of the former head of the Fed and now the US Treasury Secretary Janet Yellen on the speculative nature of cryptocurrency and the possibility of using it for money laundering. According to analyst Sven Henrich, the head of the Ministry of Finance has actually declared war on bitcoin.
“Digital currencies can provide faster and cheaper payments. But there are many issues to be explored, including consumer protection and money laundering,” Janet Yelen said, also mentioning the possibility of launching the Central Bank's own digital currency (CBDC).
The fall in bitcoin could also have been facilitated by the fall in global indices of technology companies, as well as the beginning of a large-scale vaccination against coronavirus.

- According to Bloomberg, against the background of the decline in the bitcoin rate, the head of Tesla and SpaceX, Elon Musk, lost the first place in the ranking of the richest people on the planet. Tesla shares fell 8.6%, causing Musk to lose $15.2 billion. Shortly before the decline, the company announced that it had added $1.5 billion in bitcoin to its balance sheet. At the same time, the fall in bitcoin, according to Bloomberg, may be partly related to the statement of Musk himself, who called the prices of cryptocurrencies too high.

- Due to technical failures, some customers of the Philippine crypto exchange PDAX were able to buy bitcoin almost 10 times cheaper than the market price, Bitpinas reports. One of the users admitted that he bought bitcoins for 300,000 pesos ($6,150), while the average market price of BTC was about $50,000, after which he transferred the cryptocurrency to his wallet.
A day later, PDAX sent him a letter demanding the return of the bitcoins, but the buyer's lawyer claims that "the transaction was legitimate, in accordance with applicable laws, and PDAX cannot withdraw transactions unilaterally."
Another client of this crypto exchange unexpectedly found 40 billion Philippine pesos or about 820 million dollars in his account. It is not reported whether he was able to withdraw this "gift" from PDAX.

- Three platforms - Binance, Huobi and OKEx - account for 75% of the total trading volume on crypto exchanges, according to BDCenter Digital. The safest exchanges were Kraken, Coinbase and Binance.
The study showed that the number of cryptocurrency users has almost tripled since 2018 and reached 191 million users from over 150 countries in the third quarter of 2020. At the same time, the researchers emphasize that the availability of an exchange in a country does not mean the actual availability of all its products and functionality. So the purchase of cryptocurrencies using a credit card is supported only by 65% of sites.

- One of the world's largest money transfer services, MoneyGram, refused to use the product based on the XRP token due to the claims of the US Securities and Exchange Commission (SEC) against Ripple. This is stated in a report by the company.
Against the backdrop of SEC claims, in addition to MoneyGram, Coinbase and OKCoin, Galaxy Digital, Bitstamp, B2C2, eToro and Kraken have already refused to support the XRP token. Asset management company Grayscale Investments announced the liquidation of an XRP-based investment trust, and 21Shares has excluded the Ripple token from its traded exchange products.

- Australian authorities have charged a Sydney resident suspected of drug trafficking, money laundering and bitcoin money laundering for a total of $4.3 million. The police found two bags with $1 million in cash in his car, and seized mobile phones, a laptop and a batch of illegal substances from his home.
Recall that in January 2021, the owner of the RG Coins cryptocurrency exchange Rossen Iosifov already received 121 months in prison for laundering about $5 million using digital assets.

- Analysts reviewed publications about cryptocurrency exchanges in various media. Cointelegraph was the leading media outlet by the number of articles. The first place in popularity was taken by English, the second - Russian.
According to BDCenter Digital, 12 out of 100 Twitter posts are about cryptocurrency. In just the week of February 7-14, Twitter users mentioned bitcoin over 675,000 times. The last record was set on January 10, when the weekly number of posts mentioning bitcoin reached 576,000.

- According to a responsible representative of the Russian Orthodox Church, it does not plan to create its own cryptocurrency to accept donations. The church has also refused to accept bitcoins and other cryptocurrencies. At the same time, according to Metropolitan Hilarion, believers may well make donations to the church using the phone.

- According to the co-founder of Morgan Creek Digital Assets Anthony Pompliano, the main cryptocurrency may reach $500 thousand by the end of this decade, and even $1 million in the long term.
However, the growth of cryptocurrency quotes may stop due to the rapid recovery of the global economy after the recession caused by the coronavirus epidemic. In this case, central banks will begin to roll back their quantitative easing programs, raise interest rates, stop buying assets and printing cheap money. As a result, investment flows into bitcoin, as one of the most attractive safe havens, can dry up very quickly.

- The largest developer of graphics processors, the American technology company Nvidia has announced plans to release a series of video cards specifically for mining the Ethereum cryptocurrency, which is the second after bitcoin. According to CNBC, the new type of GPU is called CMP (Crypto Mining Processor) and can appear in the market already in March 2021.


#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #forex #cryptocurrencies #bitcoin #stock_market

 

[Stan NordFX]

Two More Awards for NordFX: Best Affiliate Program & Best Forex Broker Middle East 2020​

At the end of 2020, the Forex-Awards.com expert council named NordFX Best Forex Broker Middle East. The two-tier NordFX affiliate program was also awarded a prestigious award.

Forex-Awards.com is a team of professionals headquartered in Hong Kong, which specializes in the analysis and evaluation of brokerage companies since 2010, aiming to identify the real market leaders. Based on the opinions of both independent experts and the trader community, Forex-Awards.com employees compile regular ratings of brokers, identifying their strongest and most attractive sides. The winners in each of the 30 nominations are then determined based on the results obtained. A convincing victory was won by the brokerage company NordFX in two of them in 2020.

More than one and a half million accounts have been opened by clients from almost 190 countries during 13 years of NordFX work, among them many traders from the Middle East. Back in 2013, at the 12th MENA Forex Show, the company won the prize as Best Forex Arabic Platform. And now the new award confirms the high level of services that NordFX provides to clients from this region: the first place in the Best Forex Broker Middle East nomination.

Another victory at the Forex Awards was won in the Best Affiliate Program category. Since 2016, thanks to its effectiveness and popularity, NordFX's two-tier affiliate program has been receiving the highest marks. It has been recognized as the best by expert committees of not only Forex-Awards.com, but also by Academy Masterforex-V and Saigon Financial Education Summit. More than 25,000 of the company's partners have already been paid more than $30,000,000 as commission until now, and these figures continue to grow steadily.


#eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market