Amidst an underlying downbeat mood across the crypto market, Shiba Inu extends the bearish momentum into the third straight day on Sunday.
In doing so, SHIB price maintains this week’s range trade, consolidating the corrective pullback from three-month tops of $0.00000950.
The tide is seen turning in favor of SHIB bears once again, as well depicted by Shiba Inu’s daily technical graph, with the market licking its wounds from the China-led blow.
The People’s Bank of China (PBOC) said on Friday, the Chinese central bank, said it was illegal to facilitate cryptocurrency trading.
SHIB price is trading in a tight range just above $0.0000070, shedding over 2% so far, looking vulnerable starting out a fresh week.
The meme-based coin managed to find strong bids at $0.00000676, the 38.2% Fibonacci Retracement (Fib) level of the recovery from the September 7 lows of $0.00000510 to the three-month tops of $0.00000950.
However, the recovery rally from five-day lows ran into strong offers at the critical 61.8% Fib level at $0.00000781, knocking off DOGE price back below all the major Daily Moving Averages (DMA).
However, for the upswing to extend, SHIB price needs to find a strong foothold above the critical 61.8% Fib level at $0.00000781 on a daily candlestick closing basis.
The 14-day Relative Strength Index (RSI) has pierced through the midline for the downside, changing course and signaling that there is room for additional weakness.
Therefore, SIHIB bears once again look to retest the abovementioned 38.2% Fib level on selling resurgence.
A daily closing below the latter will expose the 23.6% Fibo level of the same advance at $0.00000612. That level will be the line in the sand for the SHIB buyers, a breach of which will call for a resumption of the double top bearish reversal from near $0.00000950 levels.
SHIB/USDT: Daily chart
Alternatively, immediate resistance is envisioned at the 50% Fib level at $0.00000729, where the 21-DMA hangs around in close proximity.
Further up, the 61.8% Fib level at $0.00000781 will be a tough nut to crack if the upside momentum gathers steam.
SHIB bulls will then charge up to test $0.00000855, which is the 78.6% Fib level. Only a firm break above the latter could revive the uptrend towards a powerful barrier at $0.00000950.
Heading into a German Federal election on Sunday, the latest polls suggest that the race to the country’s leadership tightens, as the key candidates hold their final rallies. Sunday’s vote will mark the end of Chancellor Angela Merkel’s 16 years in office.
Exit polls will be released when voting ends at 1600GMT on Sunday and results will trickle in throughout the night.
Source: Al Jazeera
Poll predictions on Saturday point to the center-left Social Democrats (SPD) holding a small but narrowing lead over Merkel’s party, the center-right Christian Democratic Union (CDU), per CNN News.
The SPD is standing at 25.2%, predicted to gain 4.7 percentage points compared to the 2017 national elections. This lead could mean an end to a 20-year-long downward trend for the Social Democrats. Meanwhile, Merkel’s CDU is behind SPD at 22.4%, according to the latest polls. The Greens are currently seen lagging at 15.9%, in third place.
German Elections Preview: Three EUR/USD scenarios for the post-Merkel dawn
EUR/USD booked a third straight weekly loss ahead of Sunday’s German election, thanks to the Fed’s tapering signal and the persistent uncertainty around the indebted China Evergrande Group.
The currency pair found strong support around 1.1685 levels, finishing the week at 1.1720, as the bulls failed to find acceptance above the 1.1750 psychological barrier.Full Article
Having faced rejection just shy of the $34 mark on a couple of occasions, Polkadot (DOT) bears are tightening their grip, as a fateful week draws to an end.
Polkadot price is set to book a second consecutive week of losses, as the crypto market sentiment remains undermined by the latest PBOC crackdown, a potential default story of China Evergrande property developer group and Fed’s tapering signal.
DOT price is shedding 1.75% on the day, currently trading at $30.33. Polkadot is down about 15% on a weekly basis.
On the daily chart, Polkadot price is traversing in a three-week-old symmetrical triangle formation, with DOT bulls having failed to find acceptance above the falling trendline resistance just below the $34.
Daily closing above the latter is critical to reverse the recent downturn, as it would validate a symmetrical triangle upside breakout, fuelling a fresh upswing towards the $40 threshold.
However, DOT buyers will first need to crack the immediate resistance aligned at the 21-Daily Moving Average (DMA) at $32.33 for any meaningful turnaround.
The 14-day Relative Strength Index (RSI) trades listlessly at the midline, suggesting that DOT price could yield a range breakout in either direction.
DOT/USD daily chart
If the 21-DMA barrier continues to guard the upside, then DOT price could extend the pullback towards the ascending 50-DMA at $28.38, which will offer an immediate cushion to DOT bulls.
Sellers would then aim for the horizontal 200-DMA support at $27.70. The last line of defense for DOT bulls is seen at the rising trendline (triangle) support at $26.33.
A sustained break below the latter would confirm a triangle breakdown, calling for a sharp drop towards the mildly bullish 100-DMA at $22.08.
Ethereum, the no.2 widely traded digital asset, remains under pressure for the second straight day, consolidating Friday’s steep losses.
ETH price snapped its two-day rebound from monthly lows of $2651, as it got sold-off into the latest Chinese crackdown.
The People’s Bank of China (PBOC) on Friday declared all cryptocurrency transactions as illegal, imposing a ban, which saw over $400 million worth of tokens liquidated within 24 hours. Ethereum lost as much as $420 at one point before recovering to $2930.61 at the close.
At the press time, ETH/USD is trading almost unchanged on the day around $2900, having bounced off from daily lows at $2800.
Ethereum’s 12-hour chart shows that the price is wavering in a narrow range, remaining in close vicinity of the daily troughs, as ETH price is not out of the woods yet.
Having witnessed good two-way volatility recently, ETH price maintains its range play, with the bearish 21-Simple Moving Average (SMA) at $3185 capping the upside.
Meanwhile, the 200-SMA at $2734 continues to offer support to ETH bulls. However, with the Relative Strength Index (RSI) still holding below the midline and bear cross in play, the path of least resistance appears to the downside.
Note that the 21-SMA breached the 100-SMA from above, confirming a bear cross on the said time frame on Thursday.
Once the 200-SMA gives way, a test of the horizontal trendline support at $2450 cannot be ruled out. The $2400 round number would be next on the sellers’ radars.
ETH/USD: 12-hour chart
On the upside, immediate resistance is placed at the 21-SMA, above which the horizontal 100-SMA at $3305 will be put to test.
ETH buyers will seek fresh entries above the latter, paving the way towards the downward-pointing 50-SMA at $3418.Full Article
MATIC price is consolidating the swift recovery seen on Friday following the crash to the pivot support just above the $1 mark.
Despite the volatile trading, MATIC price remains in a familiar between $1.30-$1 seen so far this week.
At the moment, MATIC bulls are looking to extend the previous recovery momentum, snapping the two-day downswing from three-week highs of $1.273.
It’s worth adding that Polygon is in a downside consolidative mode, awaiting a strong bearish catalyst to yield a sustained move below the $1 mark.
From a short-term technical perspective, the downside appears more compelling for MATIC price, especially after the bulls failed to resist above the 100-Daily Moving Average (DMA) at $1.21 over the last two trading sessions.
The bear cross, represented by the downward-pointing 21-DMA having pierced the slightly bullish 50-DMA from above on Thursday, adds credence to the additional weakness in Polygon while the 14-day Relative Strength Index (RSI) trades flat-lined below the 50.00 threshold.
That said, MATIC bears need a daily candlestick closing below the critical upward-sloping 200-DMA at $1.05 to resume the correction from three-month tops of $1.875.
Sellers will then target the horizontal (dashed) trendline support at $0.95 on intensifying downward pressure.
Further south, the $0.85-$0.80 demand area could come to the rescue of MATIC bulls.
MATIC/USD: Daily chart
On the flip side, a firm break above the 100-DMA is needed to negate the near-term bearish momentum.
The bearish 21-DMA at $1.32 could keep the further upside elusive in MATIC price. The next relevant upside barrier is envisioned at the ascending 50-DMA at $1.38.Full Article
Solana is seeing some buying resurgence on Saturday, as it reverses Friday’s temporary drop to near the $127.50 region.
SOL bears fought back the control a day before, tracking the downbeat tone across the crypto market, in light of the blow from China. The People’s Bank of China (PBOC) issued a notice, imposing a ban on all crypto transactions as it will be considered illicit financial activity.
At the time of writing, SOL price has recaptured the $140 mark, adding about 1% on the day, although remains on track to book the second straight weekly loss.
Looking at Solana’s daily chart, SOL bulls are challenging the falling trendline resistance at $148 after two failed attempts earlier this week.
If SOL bulls manage to find a strong foothold above the latter on a daily closing basis, then it would confirm an upside breakout from a falling wedge formation.
SOL price has been trending within the bullish continuation pattern ever since it recorded all-time highs at $221.38 on September 9. The price has been forming lower highs and lower lows, carving out a falling wedge pattern on the said timeframe.
The 14-day Relative Strength Index (RSI) inches higher above the midline, allowing room for more upside.
Therefore, the wedge breakout would open doors for a rally towards the $200 mark. Ahead of that the horizontal 21-Daily Moving Average (DMA) at $159.40 could test the bearish commitments.
SOL/USD: Daily chart
Should the wedge hurdle emerge as a tough nut to crack SOL price could see a retracement towards the upwards-sloping 50-DMA at $110.50.
The next downside target is seen at falling trendline (wedge) support at $100.60, below which a fresh downswing could kick in towards the mildly bullish 100-DMA at $71.54.Full Article
Fantom price appears to be bucking the trend the majority of the cryptocurrency market has experienced since the bearish China news came out. Fantom lost as much as -17.4% on the initial news release but soon rallied 12% higher to bring the current intraday close to -7.2%.
Fantom price moves lower despite short term buying pressure
Fantom price is nearing a make-or-break level for both sides of the market. Control remains with the sellers, even though Fantom price has rallied as much as +33% from the Tuesday lows. It remains below the Tenkan-Sen and Kijun-Sen ($1.25) – levels that buyers must close above to take over.
The primary target zone for sellers is a collection of Ichimoku, Fibonacci and volume profile levels within the $0.38 to $0.41 value area. Two Fibonacci expansions (250% and 300%), the 38.2% retracement, 2021 Volume-Point-Of-Control, and Senkou Span B sit inside $0.38 – $0.41. This combination of technical levels should act as a magnet for Fantom price.
FTM/USDT Daily Ichimoku Chart
One look at the oscillators should confirm that any move lower for Fantom price will likely be sustained. The Optex bands are neutral and the Composite Index is flattening out. The Relative Strength Index looks poised to drop below 50 and at an angle that suggests a test of 40 will fail to hold as support.
Buyers, however, could quickly invalidate the bearish outlook. The current pattern on the chart is a bull flag, indicating a continuation move of the prior trend – which was up. Fantom price would need a break above the Kijun-Sen and Tenkan-Sen at $1.25 to close above the second-to-last significant swing high at $1.50. If that scenario plays out, then Fantom will most definitely continue its prior upward trajectory.
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The US consumer belied predictions that a slowing economy would cut into Retail Sales in August. Instead of falling 0.8% as forecast, sales jumped 0.7%. Sales outside of the production crippled auto sector were ever stronger, rising 1.8% in place of the projected 0.2% decline.
Retail Sales ex-autos
There is every reason to expect that Durable Goods Orders, the subset of sales items designed to last three years or more in use, will follow that lead.
Durable Goods Orders are predicted to rise 0.6% in August, after falling 0.1% in July. Orders ex-Transportation rose 0.8% in July and ex-Defense orders fell 1.1%. Nondefense Capital Goods Orders, the business investment analog, were flat in July.
Nondefense Capital Goods
The US economy has slowed in the third quarter. From a 6.4% annualized expansion in the first half, the Atlanta Fed estimates that GDP is running at 3.7% in the third quarter.
Nonfarm Payrolls fell from one million new positions in June and July to 235,000 in August.
Combined with restarted pandemic restrictions from the delta wave in some states, the weakening job market was thought to be a logical lead into slower consumption.
Although seven million people are still unemployed from last year’s lockdowns, this backlog of reluctant workers has had little effect on Retail Sales and Durable Goods Orders.
One reason is certainly the extended and supplemented jobless benefits that the federal and some state governments have enacted. Another is the record numbers of jobs on offer, 11 million in the August Jobs Offering and Labor Turnover Survey (JOLTS). Workers in almost any field can be confident of finding employment whenever they choose to return.
This category of business investment is the main market interest in Durable Goods Orders.
Business investment, along with consumer spending and government expenditures are the main categories of consumption.
Businesses spending on capital equipment tends to be strongest when executives are expecting increasing future sales.They are not only a gauge of current expenditures but a window into sales expectations.
Capital goods spending has averaged 0.8% a month this year and has helped to keep the economic expansion vibrant.
The Federal Reserve’s near approach to its taper moment is dependent on the continuing expansion of the US economy and labor market.
According to Chair Jerome Powell, the FOMC members are agreed that the economy has met the criteria for a reduction in bond purchases to begin.
Yet, at the Wednesday meeting, the Fed chose caution rather than action.
August’s dismal job numbers are probably the chief reason for the hesitation, but the July drop in Retail Sales is likely another. A strong August Durable Goods number, especially in business spending, will help to reassure the governors that the economy is in full recovery.
Durable Goods will likely cast their vote for the taper, higher Treasury rates and a higher dollar.Full Article
Two of the three major US stock exchanges ended the week in the front foot. The Dow Jones Industrial Average (DJIA) rose 0.1%, to close at 34,798. The S&P 500 added 0.1% finished the day at 4,455.48, whereas the Nasdaq Composite slid less than 0.1% settled at 15,047.70.
Surprisingly, the Dow Jones and the S&P 500 ended the week with gains amid uncertainty surrounding the indebted real-estate giant Evergrande Group. At the start of the week, equities sold off in the outcome of Evergrande’s default could spill over the financial markets.
Nevertheless, on Wednesday, Evergrande Group calmed the markest with a press release that said they would pay the yuan-denominated bonds, leaving US dollar bond-holders in limbo. As the news was released, investors seized the opportunity to buy the dip.
Additionally, the Federal Reserve unveiled its monetary policy statement and its Summary of Economic Projections, also known as SEP. The Fed left the rates and its bond asset purchasing program unchanged. However, a subtle change in the monetary policy statement opened the door for the so-called bond tapering process. Further, inside the SEP, the famous dot-plot revealed that half (9) of the FOMC members saw the need to increase the rates in the second—half of 2022, adding more fuel to the already hawkish statement. Despite the aforementioned, US stocks held to their own and rallied for three consecutive days.
That said, the Dow and the S&P finished the week with gains of 0.5% and 0.6%, each, while the heavy-tech Nasdaq barely changed.
Moving to stocks, Nike dropped 6.5% after warning of possible delays during the holiday’s shopping season, blaming a supply chain crunch. In line with Nike, Foot Loker shed 7.2%.
Further, the US Dollar Index finished the day at 93.27, up 0.19%, while the US 10-year Treasury yield rose four basis points (bps), ending the week at 1.453%, the highest level since July 2.
In commodity markets, gold (XAU/USD) rose 0.45%, closed at $1,750 troy ounce, while crude oil Western Texas Intermediate (WTI) finished at $73.85 per barrel, up almost 1%.
In the Crypto environment, Bitcoin is trading at $42,956.85 at the time of writing, down 4.28% weighed by news from China, specifically the PBoC, saying that cryptocurrency-related transactions are illegal.
Ethereum price faces the same assault as the broader market with news that China is officially made all cryptocurrency transactions illegal. The market was positioned perfectly for bearish news to give sellers more control.
Ethereum price fails to hold above $3,000
Ethereum price looked poised to continue its massive bull-run when it broke above the Cloud and closed within the $3,100 value area. However, buyers were unable to unwilling to push Ethereum any higher. One look at the series of resistance zone near the $3,200 to $3,300 levels would give any trader or investor pause to buy:
As a result of the failed breakout, sellers have regained control and look to push Ethereum price below the next support level at $2,500 to $2,200. The Relative Strength Index shows a bear flag with failed support against the last oversold level in a bull market (40). The Optex bands have curled south again and will probably revisit the lower extreme oversold – adding to near-term selling pressure.
ETH/USD Daily Ichimoku Chart
Bulls can invalidate the near-term selling pressure – but the limitations are time-based. An Ethereum price close at $3,600 would fulfill all buy one of the necessary conditions for an Ideal Bullish Ichimoku Breakout setup. The one condition lacking is the Chikou Span in ‘open space.’ To be in ‘open space,’ the Chikou Span needs to be above the candlesticks, and it must be free from intercepting any candlesticks in the next five to ten periods.
For the ‘open space’ condition to be accurate, Ethereum price needs to close at $4,000, or buyers will have to wait until October 4th when the threshold to close in ‘open space’ returns to the $3,600 value area.
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The CAD and the USD is ending the day as the strongest of the major currencies as the flow of funds into the CAD were by higher oil prices, and the US dollar continues to be supported by higher yields and perhaps a little flight to safety (although stocks did recover most of their losses by the close).
The NZD is the weakest along with the AUD. Evergrande missed making payments to some of its bondholders, but technically has 30 day grace period to correct the situation. However, that is not expected. Although there is some anxiety, the market is becoming more comfortable with the idea of a default. Nevertheless, currency pairs like the NZD and the AUD took the brunt of the selling pressure today in the currencies.
For the EURUSD, it fell back below its 100 hour moving average at 1.17248 and was able to stay below that level through out the US session. The pair also did find support near the 1.1700 level (there is a swing area from 1.16996 to 1.17054). Close support held. Close resistance held. Next week traders will be eyeing those levels for the next bias clues.
The GBPUSD is closing near the lows for the day and just below the 100 hour MA at 1.36713. The pair this week traded toward the August 20 low at 1.36016 (the low reached 1.3608 on Thursday and shot higher after the BOE more hawkish rate statement on Thursday. The high price stalled right at the 200 hour MA and found willing sellers. Today, the price was able to extend below the aforementioned 100 hour MA at 1.36713. That sends the pair into the weekend with a bearish bias.
The USDJPY broke to the highest level since August 11 today. The high reached 110.787 which was just short of that high at 110.793. The price is currently trading at 110.74, now far from that level, but will need to shove above the level next week, if the bullish bias is to continue unabated.
The USDCAD moved higher and then back down, largely helped by the downs and ups in crude oil. The price of crude oil is closing up $0.63 at $73.93 after trading as high as $74.27, but also traded as low as $72.81 intraday. The swing lows from September 19 and September 23 is the next major target on further selling at 1.2633 to 1.2638. In the new week, that swing area would need to be broken to increase the bearish bias. The pair is currently trading at 1.2644.
The AUSUSD moved below its 100 hour MA at 0.7260 to a low of 0.72355, but has rebounded back toward the 100 hour MA into the Friday close. That MA will be the close barometer for the buyers and sellers in the new week.
In other markets today:
In the US stock market, the Dow and S&P closed higher. The Nasdaq closed lower but closed near session highs.
In the US debt market, the 10 year yield moved to a intraday high at 1.466%. That was the highest since early July. The yield for the benchmark issue traded as low as 1.297% this week, before reversing and going higher
Thank you for all your support. Have a great weekend.Full Article
Futures pointed to a 25 point decline in the S&P 500 at the open but after some early softness the market quickly firmed.
On the week:
Here’s the weekly chart of the S&P 500: