News Updates September 25, 2022
1. Analyst Predicts Big Correction in Tech Stocks That Drags Bitcoin With It – Here’s His Downside Target.
A widely followed crypto analyst is predicting a massive correction in tech stocks that would drive the value of Bitcoin (BTC) to new bear market lows.
In a new video update, popular crypto analyst Nicholas Merten tells his 514,000 YouTube subscribers that he believes technology indices like the Nasdaq are due for a 50% devaluation from the highs.
“Our general target is that at a minimum, just from where we’re at right now, we should at a minimum expect technology indices like the NASDAQ are going to be probably correcting 50%.
We are well overdue for a proper recessionary bear market, depressionary bear market, where instead of the kind of 15% to 30% dips that we’ve gotten many times over the last decade that soon after recover very swiftly, we should be expecting a harsh correction that is going to take us down 40%, 50% or 60%.
I don’t want to call the exact date nor the exact value that we’re going to go to because no one really knows that but I want to give ourselves a goal post that, potentially, over the coming months going into Q1 of 2023, we could see the Nasdaq come down another 28% that would essentially take us from [its] all-time highs down to a clean 50 to 50.5%.”
Merten says that such a decline for the Nasdaq is bad news for Bitcoin, and gives a rough price target for the leading digital asset.
“If we think about the fact that Bitcoin would be holding neutral to the Nasdaq, we take it here to our Bitcoin chart and look at an equalized amount of decline in Bitcoin’s price from where we’re at now and that would take us roughly down towards the $13,600 to $14,000 [area].”
Bitcoin is changing hands for $19,134 at time of writing, a 1.7% gain on the day. A decrease to Merten’s price range would mark a dip of around 28% for BTC.
2. Bitcoin risks worst weekly close since 2020 as BTC price dices with $19K
There's little to smile about for Bitcoin bulls as the weekly candle nears completion at nearly the same place as two years ago.
Bitcoin (BTC) headed for its lowest weekly close since 2020 on Sep. 25 as a week of macro turmoil took its toll.
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD trading near $19,000 with hours left to run on the weekly candle.
While only down $400 since the week began, the pair offered traders little optimism amid fears that the coming days would continue the bleedout across risk assets.
“The whole week traded within the monday range. Weekly close gonna be bearish, looking like a pin bar,” popular trading account Crypto Yoddha told Twitter followers in a summary post.
“Also consolidating at the range low. So need a bounce first before taking a position. Next week is gonna be important. (Q3 close + Monthly close).”
Macro commentator Alex Krueger meanwhile noted that the Sep. 19 close marked Bitcoin’s lowest of 2022.
"Thinking lower then higher," he wrote in a Twitter discussion.
"Replay of June CPI week on equities, crypto to outperform once bounce is on, as it has been showing relative strength (heavy spot buyers last two days). strong bounce =/ new multi-week upwards trend."
Unless a last-minute rebound entered, however, the largest cryptocurrency was on track for an even less enviable achievement — its lowest close since November 2020.
3. While the US Dollar Tramples the Euro, Pound and Yen, Russia’s Ruble Skyrockets Against the Greenback.
While the U.S. dollar has soared in value against a basket of worldwide fiat currencies, Russia’s ruble climbed 4.5% against the greenback this week. During the first week of September, Russia told the press China would pay for natural gas with rubles and yuan. Moreover, Switzerland’s imports of Russian gold reached a high not seen since April 2020.
The Greenback Is Soaring, but Russia’s Ruble Is Also Rising Higher
This week the U.S. Dollar Currency Index (DXY) skyrocketed to new heights leaving a great number of fiat currencies worldwide badly bruised. For instance, two days ago, the European Union’s euro tapped a 20-year low against the U.S. dollar dropping to $0.973 on Friday.
Presently, the euro is even lower at $0.9690, and it is down 2.82% against the greenback during the past 30 days. 30-day statistics indicate the yen is down 4.72%, the sterling pound shed 8.17%, and the Canadian dollar lost 4.78%. The Chinese yuan breached a 7:1 exchange rate against the U.S. dollar for the first time in two years.
However, Russia’s native fiat currency the ruble has been more resilient this year, and it started to see gains a month after the start of the Ukraine-Russia war. Toward the end of June, Russia’s ruble tapped a seven-year high against the U.S. dollar, and at the time economists said “don’t ignore the [ruble’s] exchange rate.”
This Friday, while America’s native fiat currency climbed to new heights against various currencies worldwide, the ruble climbed 4.5% against the USD. The ruble managed to do this while the DXY breached a 20-year high following the Federal Reserve’s recent rate hike. The rising ruble follows Russian president Vladimir Putin explaining earlier this week that he vows to use “all means available” to win the war with Ukraine.
China Pays for Gas With Rubles, Swiss Purchases 5.7 Tons of Russian Gold in August, Analyst Says Ruble Withdrawals Have Pushed the Currency Higher
There were also hints of nuclear retaliation from the Russian president, and he detailed he was mobilizing more troops. Additionally, Reuters reported during the first week of September that China would be purchasing fuel from Russia with rubles and yuan payments.
Gazprom CEO Alexei Miller told the press at the time that China paying in rubles and yuan rather than dollars was “mutually beneficial” for both partners. Furthermore, reports indicate that the Swiss Federal Customs Administration revealed Switzerland imported 5.7 tons of Russia’s gold reserves in August. The stash was worth roughly $324 million, and the Swiss have not purchased a cache that size in over two years.
4. This Week on Crypto Twitter: Outrage as SEC Claims All Ethereum Transactions Happen in USA
As ETH dropped and the SEC loomed, the NFT community celebrated the first International NFT Day on Tuesday.
The price of Ethereum was reeling this week after predictions that the merge would be a “buy the rumor, sell the news” scenario largely played out.
Over on Crypto Twitter, people continued to discuss the network this week after U.S. Securities and Exchange Commission (SEC) Chief Gary Gensler redoubled his offensive against crypto, also aimed at Ethereum.
It’s becoming increasingly evident that Gensler views Ethereum as a security. And on Monday, when the agency filed a federal lawsuit against crypto influencer Ian Balina, it put out an even more extreme view: that the U.S. government has jurisdiction over all Ethereum transactions, according to the SEC’s logic, because most of the network’s validator nodes are clustered in the U.S.
There it is
The supermassive black hole sized bad take at the heart of the Balina filing.
5. Fed Chair Jerome Powell Says a 'Difficult Correction' Should Balance US Housing Market.
Following the Covid-19 pandemic, real estate investors did extremely well, despite the millions of Americans that were put out of work and faced evictions during the lockdowns in 2020. Stimulus put a bandage on the financial wounds inflicted by Mainstreet business shutdowns and deadlocked supply chains. In fact, after the pandemic, America’s housing market boomed to new heights and soared amid rising inflation. Meanwhile, the U.S. Federal Reserve chair Jerome Powell hinted this week that the U.S. housing market needs a correction, and he believes it can be adjusted in a way so “people can afford houses again.”
‘Deceleration in Housing Prices’ Is a ‘Good Thing,’ Fed Chair Declares
Last Wednesday, the U.S. Federal Reserve met to announce the next interest rate hike and the central bank raised the federal funds rate by 75 basis points (bps). The Fed said last week that it aims to “achieve maximum employment,” and the central bank is still targeting a 2% inflation rate over the long term. The three-quarters of a percentage point rise is the Fed’s third 75bps rate hike in a row. Following the 75bps increase, stock markets, cryptocurrencies, and precious metals had seemingly priced in the Fed’s rate increase.
However, the Fed chair also discussed the U.S. housing market this week, and the commentary rattled markets during the past few days. Powell hinted at a real estate correction or a cooldown of housing prices to wrestle inflation down back to the 2% levels.
“The deceleration in housing prices that we’re seeing should help bring sort of prices more closely in line with rents and other housing market fundamentals — And that’s a good thing,” Powell insisted. “For the longer term what we need is supply and demand to get better aligned, so that housing prices go up at a reasonable level, at a reasonable pace, and that people can afford houses again,” Powell told the press on Wednesday.
The 16th chair of the Federal Reserve added:
From a sort of business cycle standpoint, this difficult correction should put the housing market back into better balance.
6. What is scalping in crypto, and how does scalp trading work?
Scalping focuses on making money off of slight price swings. Crypto scalpers use this method to reap quick gains from reselling assets.
Although cryptocurrencies are known for their volatility, they give traders various opportunities to pocket and reinvest the gains. Scalp trading is a crypto strategy that helps scalpers to take risks and make the most of frequent price fluctuations by observing price movements.
This article will discuss scalping, how it works in cryptocurrency, the advantages and disadvantages of scalp trading in crypto, whether it is complicated and how much money you need to engage in it.
What is scalp trading?
Crypto scalp traders target small profits by placing multiple trades over a short period, leading to a considerable yield generated from small gains. Scalpers step in for highly liquid and significant volume assets that result in greater interest owing to the news.
Scalping strategies require knowledge of the market even though it is a short-term trading strategy. To capture the difference between supply and demand, scalpers use a spread, which involves buying at the bid price and selling at the asking price. If traders are prepared to accept market prices, this approach permits making a profit even when orders and sales are not changed.
How does scalp trading work?
Charting, speed and consistency are the critical elements that make scalping possible. For instance, scalpers use technical analysis and various value gaps caused by bid-ask spreads and request streams.
Scalpers generally operate by creating a spread, or buying at the bid price and selling at the asking price, so that value distinguishes between the two value centers. Crypto scalpers try to hold their positions for a brief time, reducing the risk associated with the tactic.
Additionally, traders that utilize scalp trading techniques must respond quickly to capitalize on the minutes — or even seconds — of short-term volatility. In this manner, scalpers can reap benefits over time continuously. But how do crypto scalpers make money?
The different scalp trading tools used by crypto scalpers to reap gains include leverage, range trading, and the bid-ask spread, as explained below:
Leverage: Leverage describes how much traders contribute from their pockets to increase their margin. Some scalpers use this method to increase the size of their position.
Range trading: Scalp traders who engage in range trading watch for trades to close inside predetermined price ranges. For instance, some scalpers utilize a stop-limit order, which executes the trade at future market values.
Bid-ask spread: By employing this strategy, scalpers can take advantage of the significant price discrepancy between the highest bid and lowest ask.
Arbitrage: By purchasing and selling the same asset in different marketplaces, arbitrage scalpers can benefit from the price difference.
How to set up a crypto scalping trading strategy?
To set up a crypto scalp trading strategy, follow the simple steps below:
Choose the trading pairs: Considering the volatility and liquidity of crypto assets, choose a trading pair that suits your risk-return investment profile.
Select a trading platform: While selecting a trading platform that offers your chosen trading pair, consider various aspects like trading fees, interface, customer service, etc.
Choose scalper bots: The foundation of scalping is speed; therefore, those who trade utilizing software are constantly in the lead. Also, the manual management of an investment portfolio is typically time-consuming and error-prone.
Try various trading strategies: Before scalping, ensure you understand your strategy well by trying different trading techniques, as mentioned in the section above.
