Fed Promises to Keep Monetary Policy Loose; Interest Rate Near Zero & Inflation Above 2%

Fed Promises to Keep Monetary Policy Loose; Interest Rate Near Zero & Inflation Above 2%

The dovish tone from the Fed is pushing the USD down, which has been falling throughout this month while the risk-on environment is good for both stocks and bitcoin.

“The economy is beginning to move ahead with real momentum,” Jerome Powell, Federal Reserve chair, told reporters Wednesday after the central bank held interest rates near zero and kept bond purchases at $120 billion a month.

Powell reiterated that it is not the time to discuss scaling back asset purchase. “When the time comes for us to talk about talking about it, we’ll do that. But that time is not now,” not until there is more than one great job report, he said.

As for the concerns around inflation due to the Fed’s aggressive support, Powell said though prices are likely to rise amidst surging demand, it is just,

“An episode of one-time price increases as the economy re-opens is not the same thing as, and is not likely to lead to, persistently higher year-over-year inflation.”

The central bank is interested in keeping the inflation above the 2% target and only when it was to move “persistently and materially above 2%” that threatens to move longer-term inflation materially above 2% that the Fed will use its tools to bring it down to mandate consistent levels, he said.

“Markets are having a hard time digesting this.”

“The Fed is saying, ‘I hear you. Inflation is going to be above 2% for a while, but I am trying to tell you we are not going to do anything about it.”

Michael Gapen Chief U.S. Economist at Barclays Plc

President Joe Biden, meanwhile, is all set to unveil a $1.8 trillion plan after a $2.25 trillion infrastructure proposal and the $1.9 trillion pandemic relief package was signed into law last month. This time to expand educational opportunities and child care.

“I took away that not even any preliminary discussion of a change in policy is imminent.”

“He gave a spirited defense of the Fed’s view on inflation and employment. They are very happy with the course they are on and not likely to change it soon.”

Carl Tannenbaum Chief Economist at Northern Trust in Chicago

How’s the Market Feeling…

This opens the doors for the continuation of a risk-on environment, which means investors are willing to enter into higher-risk investments like Bitcoin and stocks, wrote Deutsche Bank in a report published this week.

S&P 500 jumped to a record high in part bolstered by Fed’s same dovish tone and in part the ongoing tech earnings report. However, the promise of keeping the monetary policy loose is not turning out good for the dollar.

The USD index has been going down throughout this month and is currently near 90.6, while gold is still around $1,780 per ounce.

As for Bitcoin, it is hovering around $54k, which is giving altcoins a perfect chance to run higher.

Amidst this, the White House released a slew of tax increases in its “The American Families Plan,” as per which top personal income tax rate is raised from 37% to 39.6% for all taxable income north of about $550,000 for individuals and about $650,000 for married couples.

The top individual tax gain rate on long-term capital gains and dividends would be increased from 23.4% to 43.4%.

It is also proposing to give the IRS the authority to regulate paid tax preparers. They would get an annual report on the money deposited and withdrawn from every bank account in America.

Read Original/a>
Author: AnTy

Bitcoin Re-Entering the ‘Intense Historical Trading’ Area Following a Strong Uptrend

Bitcoin is back at near $11,000.

The leading digital currency has been making its way upwards since the mid of last week. Today, to mark the starting of a new week, Bitcoin went as high as $10,985, re-entering the $10,800 to $11,000 area of intense historical trading.

With the move, BTC has broken through its 30-day moving average — indicative of a strong uptrend and “that large funds are willing to actively purchase on the market.”

Currently, BTC is trading around $10,900 in the green with about $1 billion in ‘real’ trading volume.

“Weekly close looks good and don’t know why people continue to be overly bearish. Bitcoin got a short term pullback, and -20% is nothing unusual. Bitcoin continues to uptrend, and for the third week in a row has closed above the support zone of $9900 to $10,175,” noted trader Josh Rager, adding “$11ks next.”

As for the futures market, the Bitcoin futures curve has widened, albeit modestly, although “given the uncertain macro theme further upside remains somewhat uncertain,” said Denis Vinokourov of London-based broker.

The strong move came following the bullish weekend not only for BTC but also altcoins like KNC, REN, LINK, LEND, and ZRX, which according to Santiment, experienced similar factors like MVRV ratio in the ‘bounceback’ zone, ‘blood in the streets,’ ongoing accumulation, declining crowd interest, and strong fundamentals.

And today, a positive move in BTC price has the altcoins getting green again. Among the top cryptos, Cardano (ADA), with early 11% gains, and Polkadot (DOT) with 8.42%, are leading.

Today’s top gainers include Hegic (46%) and Swipe (40%), while Orion Protocol (76.5%) and Pixie Coin (62%) are the biggest losers.

Becoming Less Volatile

The third quarter is coming to an end this week. September did what it has been doing all those years and ended the month at a loss of -6.7%.

Interestingly, this month, bitcoin has been less volatile than Tesla. In Sept. bitcoin moved less than 1.25% in absolute value 52% of the days, unlike 6% of Tesla.

While the volatility of bitcoin continues to drop, investors are slowly moving to bot trading to capitalize on the price swings. Chinese brokerage service Pionex which has a monthly trading volume of $5 billion on its online brokerage platform, has over 80% of its 100,000 users running a trading algorithm.

The startup with Shunwei Capital and ZhenFund among its backers makes about $3 million by charging a 0.05% fee per transaction. The Singapore incorporated company has 80% of its trades fulfilled by the order books on Binance and Huobi.

“Trading bots let users overcome their humanity flaws and become a rational investor,” said founder Chen Yong.

Read Original/a>
Author: AnTy

This Bitcoin Trend Happened Only Twice & Indicates We are Still in the Early Phase of a Bull Market

  • Bitcoin is back at near $12,000 level as we trade around $11,700.

The largest cryptocurrency took a drop under $11,300 yesterday only to make its way back to $11,850, which has been attributed to Dave Portnoy of Barstool Sports, educating his 1.7 million Twitter followers about Bitcoin in which he is already in seven figures deep.

Trader DonAlt, however, is not “positioned for huge upside,” and emphasizes on “sub $11k for any significant bearishness.” He said,

“Support held & made the price bounce back to the last resistance again. Going to watch how this Portnoy action into that resistance plays out, bulls are looking for a close above in the next few days.”

For Bitcoin, maximum pain appears to be around $11,500 as the digital asset continues to hover around this level ever since BTC broke above $11,000 in the last week of July.

The good thing for bitcoin meanwhile is the BTC balance on cryptocurrency exchanges, which continues to slide down. Ever since the March sell-off, the price of the crypto asset has been going up while exchanges’ BTC balance has been “declining extensively,” a trend last seen in 2016.

This means while investors are holding instead of taking profits, they are ready to buy any dips with the rapidly rising stablecoin supply.

“Historically, this happened twice & it’s an indication that we’re still in the early phase of a bull market,” said trader Crypto squeeze. “The big players aren’t ready to unload at this price.”

Dollar’s Loss is Bitcoin’s Gain

While bitcoin has been uptrending, all this time, the US dollar has been declining. It was in March during the market-wide correction that the USD gained strength — DXY went from 95 to 102, last seen in late 2016.

However, since then, the significant trend has been towards the south. Just recently, the US dollar index hit over a two-year low. Currently, it is slightly better at around 93 amidst the impasse in Congress about the additional stimulus to cope with the coronavirus pandemic.

“The dollar being weaker is a sign of positive risk sentiment,” said Klarity’s Sahota. “The market is moving to places that would give them a better return.”

The better-than-expected US jobless claims data, claims for state unemployment benefits were 963,000 for the week ended August 8, isn’t helping the dollar either. But the dollar’s loss is undoubtedly bitcoin’s gain.

Not only the losing faith in fiat currency aids in the adoption of the digital asset, which is in limited supply and is censorship-resistant, but it also means BTC price moves up. Trader and economist Alex Kruger said,

“The dollar is green like a leaf. Leaves grow old, fall, and die. Bitcoin is weightless and immortal. Dollar falls, Bitcoin remains. That is why BTC/USD goes up. Simple logic.”

Read Original/a>
Author: AnTy

Gold’s Demand as a Safe Haven Rises in the West But Falls in the East Due to COVID-19: WGC

Trading near a seven-year high, gold is heading for its biggest monthly gain since 2016 as central banks ramp up the stimulus to keep up the economy after being damaged by the coronavirus pandemic.

Gold rallied in 2020 as investors sought safe haven amidst the unprecedented monetary stimulus sparked concern about currency debasement. The bullion is up over 13% YTD compared to Bitcoin’s 25% gains.

Stimulus-Boost-Gold
Source: Bloomberg

In 2020, the precious metal’s allure as a store of value boosted as evident from the fact that gold ETFs saw their highest quarterly inflows in four years amidst the global uncertainty and financial market volatility, as per the latest report of the World Gold Council.

Total gold investment demand that includes bars, coins, and gold-backed exchange-traded funds (ETFs) all soared, increasing 80% YoY in the first quarter to a high of 3,185t fueled by the COVID-19 pandemic.

The global gold demand in value terms reached $55 billion, the highest since Q2 2013 and climbed to new record highs in Indian rupees and Turkish lira, among other fiat currencies, and to an eight-year high in US dollars.

Diversion between East and West

While the demand for gold rose in the west to the levels last seen after Donald Trump’s election and Brexit vote, the bar, jewelry, and coin consumption in India and China dropped to multi-year lows amidst the coronavirus-led lockdowns at higher prices.

“It was an interesting diversion between East and West,” said Louise Street, a market intelligence manager at the council.

In China, the first quarter saw gold consumption declining 48.2% y/y to 148.63t along with the country’s gold production which was down 10.9% y/y. Secretary-General Zhang Yongtao who also noted the increased prices said,

“Since the outbreak, the country has adopted strict prevention and control measures (and) consumer demand has faced an impact.”

Though difficult to forecast demand due to the virus, gold’s safe haven appeal is “very much prominent,” Street said while gold ETFs in Europe and North America dominated purchases, funds in China and India also saw large increases in buying last quarter.

“Gold demand will continue to feel the effects of Covid-19 for the rest of 2020,” Street said.

“In particular, the divergence between investment in gold-backed ETFs and consumers via jewelry will likely continue until there is greater economic and market certainty.”

Central bank hoarding gold too

Meanwhile, central banks continued to amass gold, which grew by 145t in Q1 amidst heightened volatility and uncertainty, but down 8% from 1Q19. WGC is expecting the global gold reserves to slow sharply.

The most significant purchases were made by the consistent recent buyers, with Turkey by far the biggest buyer during quarter one, accounting for 50% of the Q1 global total. Other central banks viz. UAE, India, Kazakhstan, and Uzbekistan increased their official gold reserves by at least a tonne.

The largest gold buyer since the end of 2005, Russian central bank meanwhile, announced with no explanation that it would suspend its gold buying from April 1st, but it hasn’t been completely ruled out. Recently, it drew down reserves to protect its currency in the face of lower oil prices and economic impact of the coronavirus outbreak, pushing their gold’s share of total reserves at 21%.

Total gold supply also fell 4% in Q1 due to coronavirus lockdowns that hit mine production and gold recycling.

Read Original/a>
Author: AnTy

Bitcoin & Gold Outperform Traditional Equity/Bond Portfolios In Q1 2020

  • Over the long-term, Bitcoin and S&P 500 correlation likely to return near zero levels
  • Allocating a small percentage to either gold or bitcoin increases the resistance of a portfolio

Historically, Bitcoin has been relatively uncorrelated with the S&P 500, staying between .15 and -.15 since 2012. Over the last month, however, the correlation shot up. It peaked on Black Thursday when both crypto and equity markets experienced historic and sudden losses.

But it doesn’t mean Bitcoin and S&P 500 are suddenly correlated because this short-term correlation spike has been under very unique circumstances, shared Coin Metrics in its latest report.

The news of spreading COVID-19 pandemic also has the correlation between SPY and GLD suddenly surging to its highest level since 2013, likely due to liquidity crunch leading to sell-offs across the board.

As a matter of fact, Bitcoin fundamentals didn’t change over the last month although the outside world did. In the short-term, it is expected to continue but in “over the long-term, Bitcoin and S&P 500 correlation are likely to revert to the mean and return to levels of near zero.”

As for its correlation with gold, historically it wasn’t very strong but suddenly increased in March just like with SPY.

“Although Bitcoin and gold may not act as safe havens during a global liquidity crisis, they may act as a safe haven during increases in monetary inflation and quantitative easing.”

Just a small allocation to Bitcoin outperforms other portfolios

Interestingly, both bitcoin and gold outperformed traditional equity portfolios.

In Q1 of 2020, risky assets across the world retracted as lockdowns to curb the spread of COVID-19 put pressure on the world economy. While both of these hard assets declined alongside US equities as investors fled to cash, Bitcoin and gold have recovered the majority of their losses.

Crypto data tracker TradeBlock analysed three different model portfolios, Equity + bond 60:40, Equity + bond + bitcoin 55:35:10, and Equity + bond + gold 55:35:10.

This revealed that a portfolio with just a modest allocation to bitcoin outperformed the equity and bond only portfolio and also the one containing gold.

“Allocating a small percentage to either gold or bitcoin increased returns.”

Source: TradeBlock

This week, US banks will be reporting their first-quarter earnings which were ridden with the challenge of near zero interest rate and a free-falling US economy.

Japanese conglomerate SoftBank is expected to lose nearly $17 billion for their tech-focused Vision Fund. Wells Fargo’s profits plunged about 50% in the Q1 and its shares dropped over 40% YTD while JP Morgan’s net income was down 69% and its shares are down 30% YTD.

Public crypto companies also reported losses but for Q4 2019. In the past week, Galaxy Digital reported a net income loss of $32.9 million and experienced layoffs in February 2020. Canaan reported a net income loss of $148.6 million loss for the fourth-quarter ending 2019. The Bitcoin miner equipment manufacturer’s net income declined and its share price (CAN) dropped 60% since its IPO.

Read Original/a>
Author: AnTy

Binance CEO Isn’t Worried About Bitcoin, Says “Demand is Increasing”

On February 17, the Dow Jones Industrial Average was near its peak at 30,000, driven by the longest US economic expansion in history. During that time, bitcoin was trading above $10,000. Over the next thirty days, the coronavirus (Covid-19) burst out of China with major outbreaks in Italy, South Korea, France, Spain, Germany, the UK, and the USA.

As countries shut down their borders and people were asked to be quarantined in their homes, businesses came to a sudden stop. The stock markets went into a meltdown and forced central banks to take emergency actions not seen since the 2008 global financial crisis.

The world’s leading cryptocurrency also crashed to $3,850 which was because of those relatively new to crypto who sell when they feel there are risks. Also, those who depend on short term gains in their investment portfolios to pay rent were forced to sell crypto to cover their living expenses.

According to the founder and CEO of Binance, Changpeng Zhao, when people fear the doomsday, they hoard cash with increased pressure to sell investments. But they will “eventually find out they no longer need to hoard it and will put it back on investment.”

But despite this Zhao isn’t “worried about crypto at all.”

“The fundamentals did not change. Unlike fiat, bitcoin remains a currency with limited supply. No one can print more of it. Demand is increasing, especially now. It will be fine,” said Zhao.

Things aren’t black or white but greyscale and fundamentally crypto still works and with fiat being printed at a record pace, “you decide what will happen, in time.”

But that would happen eventually as Zhao explained currently, “Markets are inefficient. The speed of change propagation is slow, which actually gives us plenty of opportunities.”

Binance founder is extremely bullish on Bitcoin and cryptocurrencies and the reason behind this is the broken current system which he said bitcoin fixes.

With central banks printing out money to bail companies out, “the taxpayers are robbed (made poorer) indirectly.” And bitcoin fixes this.

With cryptocurrencies, things are different because there are no government bailouts which he said, “breaks the cycle.”

But it doesn’t mean, problems will be magically solved as companies will still fall and users will still get hurt.

Read Original/a>
Author: AnTy

Binance Exchange To Restrict Crypto Trading For Japanese Users In The ‘Near Future’

  • Binance ready to phase out Japan residents from trading services in near future.
  • Further confirmation on details on the operations is set to be released at a later date.
  • Could regulation strictness be the case, similar to Binance’s troubles in the US?

In an announcement released on Thursday, January 16, 2020, on Binance blog, the world’s largest exchange will stop serving Japanese customers in the near future. The statement started out by thanking the support of their customers over the years since launch in 2017. The statement further read,

“Binance.com will be phasing out the provision of services to residents of Japan.”

The statement however confirmed that trading on the platform will continue as usual for Japan based customers. However, in the future the exchange will start slowly restricting Japan residents from trading on the platform with the official announcement expected to be released “shortly”.

The announcement will come as a blow to crypto investors in Japan as one of crypto’s largest exchanges closes its doors on the residents. Regulation has been one of the toughest barriers to entry for cryptocurrency companies in Japan and the latest closure may yet be a case of regulation uncertainty.

While all seems lost could there be a possibility of a “Binance US” situation unfolding in the country?

Binance Japan on the way?

The closure of trading services on Binance Global for US residents was indeed a big blow to the crypto industry in the biggest economy in the world. Every cloud has a silver lining though; Binance US, a regulated cryptocurrency platform sprouted to cater for US customers. Could such an effect take root in Japan?

While no official communication has been offered yet, the possibility of a highly regulated KYC compliant Binance Japan may be on the way.

As at publishing, no response to our questions has been received yet from Binance. We will follow up the story as it develops.

Read Original/a>
Author: Lujan Odera

“Next ALTS Run Gonna Be Crazy” These Altcoins Have Already Surged 100 to 1000%

In 2019 to date, Bitcoin price has registered an increase of 145% as it trades near $9,300 BTC/USD level. Unlike the leading cryptocurrency, top cryptocurrencies like Ethereum (34.7%), EOS (28.8%), Tron (1.08%), Cardano (0.82%), and XMR (32.39) are only green in the lower percentages.

Here is how other popular crypto altcoins have been performing in the 2019 calendar year: XRP (-18.5%), IOTA (-23.11%), Dash (-9.91%), Ethereum Classic (-4.93%), Zcash (-34.74%), NEM (-35.55%), QTUM (-2.30%), OmiseGo (-30.60%), Lisk (43.51%), DigiByte (-30.91%), Waves (-74.13%), and many others are meanwhile deep in red in 2019.

Source

In 2019, despite going through a bull rally in Q2 and then seeing another bout of a surge in late October, the majority of the altcoins have failed to show any progress.

During the recent spike in crypto prices, Chinese altcoins registered significant gains but even that hasn’t been able to provide much relief to the digital assets that have been down 90 to 95% from their ATH.

Davos Cryptos, community building of mobile wallet Bolt believes the next bull run is going to be a “crazy” one.

However, a handful of cryptocurrencies have already recorded tremendous gains this year.

According to Coincodex’s top 100 cryptocurrencies, with more than 1,500% of gains, Synthetix, Seele, and EDUCare are at the top.

Source

One of the hottest cryptocurrencies of 2019 among the top cryptos is Link, the 15th largest cryptocurrency, which has seen a spike of 846% trading at $2.82. In July it was up over 2,000%.

Ravencoin is another digital asset that jumped 118% in 2019 to date currently trading at $0.03. However, in June it surged to $0.75.

A few other coins enjoying significant gains YTD are Matic Network (164.5%) and REN (114%).

However, exchange tokens are outshining the top top altcoins with OKB of OKEx exchange leading this pack with over 370% gains while it trades at $3.25.

BNB, the native token of the leading cryptocurrency exchange Binance is up 235% YTD as it trades at $20.15. Similarly, Huobi Token (HT) of exchange Huobi is up 261% at $3.94 and KuCoin Shares (KCS) of KuCoin exchange has jumped 153%.

Just remember there are bitcoin maximalists who believe bitcoin is the one and only so be careful where you get your information from as some have motives and some have no care to entertain the rest of the cryptocurrency market, which accounts for roughly $82 billion as of November 2, 2019.

Whether you take that insight with a grain of salt or not, the truth is alts are poised and positioned to do a big run should the bitcoin rally take place too.

Now, it remains to be seen if any digital asset from the top 10 cryptocurrencies would register any gains this time or stay dormant. By many expert estimations, we are just under 200 days before the bitcoin mining halving as many predict the next six months to be an extremely bullish trend to unfold as the crypto market cap looks to break its previous high of just over $830 billion back in January 2018.

Latest Bitcoin Price News and Crypto Market Updates

Read Original/a>
Author: AnTy

Wells Fargo’s Blockchain-based Stablecoin Will Be Faster, Cost Less Than SWIFT

The world’s fourth-largest bank said cryptocurrency will allow near real-time money movement and cut out settlement middlemen, thus reducing costs from fees.

Regarding the technical aspects of this new product, Wells Fargo has built their own blockchain using Corda Enterprise, the enterprise version of R3’s blockchain technology. While we will not see this product in 2019, the bank hopes to launch Wells Fargo Digital Cash within the next year. The transfers are expected to feature only U.S. dollars at first but the institution also plans on making other currencies available as they expand their operations globally.

Lisa Frazier, head of the Innovation Group at Wells Fargo said:

“When we move money across the world and we need to exchange currencies, we have to go through third parties such as SWIFT and other banks. That’s a long process and every time there’s a connection with external parties, it takes time and energy and effort.”

Obvious parallels can be drawn between what Wells Fargo is testing out and JPMorgan’s JPM Coin and its Interbank Information Network (IIN) which this week added Deutsche Bank to the 300-plus other banks on that network.

Lisa adds:

“I think the surprise is, we have found a really solid internal application for DLT on our book transfers. By doing this we are streamlining the book transfer process and are reducing the use of intermediaries that can cause a delay in settlement. Therefore we are widening the operating window for clearing of FX wires cross-border.”

Read Original/a>
Author: Sritanshu Sinha

ZILLIQA Price Prediction: Long-term (ZIL) Value Forecast – July 4

Zilliqa-To-Launch-a-New-Blockchain-Incubation-Program
  • ZIL/USD market may enter other near range zones in the upper or lower outer marks.
  • The ZIL/USD market bulls need to break out resistance at $0.0165 price level to affirm bullish potential in the market.

ZIL/USD Medium-term Trend – Ranging

  • Resistance levels: $0.018, $0.019, $0.02
  • Support levels: $0.014, $0.013, $0.012

The current medium-term trend of ZIL/USD market, it’s observed that lower range moving mode has prevailed over lower high. Quite a while, the market has been ranging down under the trend-line of the 50-day SMA trading indicator. The core range zones are seeable around $0.017 and $0.016 price levels.

An outer extension of the upper range mark has found at $0.018 mark, and that also represents the immediate resistance level of the market. In a similar outlook, the lower range line posses an outer mark at $0.015. The Bollinger Upper Band and the 50-day SMA indicator are located around $0.017 mark. The Stochastic Oscillators now consolidate around range 40.

Most of the indicators show that the ZIL/USD market may continue to hover around its current choppy spots. And, there’s the possibility of seeing the market entering other near range zones in the upper or lower outer marks as mentioned above.

ZIL/USD Short-term Trend – Ranging


There have critical range price movements in the short-term trend of the ZIL/USD market today. Initially, the market was falling almost out of the range zones while it touched a low mark at $0.0153 or thereabout. It has slightly rebounded in the range to hover around $0.0165 mark.

The indicators now point to the east. The 50-day SMA indicator is located between the Bollinger Upper and Middle Band trend-lines. The Stochastic Oscillators have closed the hairs below range 80.

The pair appears struggling to push northwards. But, it has to break out resistance at $0.0165 price level to affirm bullish potential in the market. However, a chain of price touches at that point would most of the result in lowering the market value afterward.

Zilliqa:

The views and opinions expressed here do not reflect that of BitcoinExchangeGuide.com and do not constitute financial advice. Always do your own research.

[Author Alert] The author’s opinions above are solely based on their own self-conducted research. Assume any and all authors are using, holding, trading and/or buying cryptoassets mentioned as a portion of his or her financial portfolio. Use information at your own risk, do you own research, never invest more than you are willing to lose.

Read Original/a>
Author: Azeez Mustapha