• Don’t discount technicals when analyzing Bitcoin. A look at the technicals driving BTC/USD
• MUFG: Tokyo’s potential verbal intervention & the impending Jackson Hole symposium
• Crude oil makes a comeback today. Settles at $81.25, up 1.07%
• Canadian home prices post second-largest increase ever
• Baker Hughes US oil rig count -5
• European equity close: A week to forget as FTSE 100 flirts with some dangerous levels
• No Grayscale vs SEC decision today
• The situation in China is starting to remind me of the US in 2008
• Fed poll: Half of economists see the Fed waiting until at least April before cutting rates
• Kickstart your forex trading day for Aug 18:A technical look at the EURUSD, USDJPY, GBPUSD
• Canada July PPI -2.7% y/y vs -5.5% prior
• The JPY is the strongest and the GBP is the weakest as the North American trading begins
• ForexLive European FX news wrap: Yields heavy, risk tones slump

There was no major news coming out of the Fed chatter. Most of the focus was on interest rates, and stocks. Bitcoin fell toward technical support. Crude oil prices rebounded off of low levels and closed higher on the day, but down on the week.

On Friday, if you were to look at the price changes of the major currency pairs outside the JPY and CHF, they were all within 0.11% of the prior close.

Looking at the changes of the major currencies vs each other, the JPY was the strongest. The CHF was the weakest. The rest had small net gains or losses vs each other with up and down volatility.

For the trading week, the USD is closing mostly higher helped by rising yields and safe haven flows into the USD on the back of China concerns. The only currency, the greenback lost value against was versus the GBP. (a modest -0.34% decline). The weakest currency was the AUD and NZD as China weighed most on those currencies.

Below are the % change of the USD for the week vs the major currencies:

• EUR, +0.68%
• JPY, +0.26%
• GBP, -0.34%
• CHF, +0.66%
• CAD, +0.80%
• AUD+ 1.36%
• NZD, +0.95%

The USD also rose vs the offshore yuan with the USD rising:

• CNH, +0.65%

Looking at rates, yields were lower today after gains earlier this week:

• 2-year 4.942%, -1.8 basis points
• 5-year yield 4.385%, -5.4 basis points
• 10-year yield 4.252% -5.5 basis points
• 30-year yield 4.375% -3.7 basis points

For the trading week:

• The 2-year yield moved to a high of 5.024% at the weeks high, which was about 4 pips short of it 2023 high yield of 5.085%. The yield did come off high levels but is still closing higher by around 4.4 basis points
• The 10-year yield traded 2 new 2023 highs of 4.328%. That pretty much equaled the high price going back to October 2022 at 4.335%. The yield rose by 9.5 basis points this week
• The 30-year yield rose to a high of 4.426%. Like the 10 year that more or less equaled the October 2022 high at 4.423%. For the week, the 30-year yield rose 11.0 basis points

Looking around other markets today to wrap up the trading week:

• Crude rose $0.22 or 0.27% at $80.62. For the trading week crude oil fell -3.09% and broke a 7 week up streak
• Gold fell to the lowest level since March this week. For the day, it is down $0.61 or -0.03% at $1899. For the trading week, the price fell $-24.06 or -1.26%
• Silver is trading up 4.7 cents or 0.21% at $22.73. For the week, the price is up a modest 0.25% or 6.6 cents
• Bitcoin is trading at $26,168 after reaching a low of $25,601. For the trading week, the price is down 11% or $-3116

in the US stock market today, the Dow snapped a 3 day decline but the S&P and NASDAQ index fell for the 4th consecutive day. Both the S&P and the NASDAQ closed lower for the 3rd consecutive week:

• Dow Industrial Average rose 25.83 points or 0.07% at 34500.67. For the trading week, the index fell -2.21%
• S&P index fell -0.65 points or -0.01% at 4369.72. For the trading week, the price fell -2.11%.
• NASDAQ index fell -26.17 points or -0.20% at 13290.77. For the trading week, the price index fell -2.59%.

Next week the highlight will be the Jackson Hole Summit with Fed chair Powell speaking on Friday, August 25 at 10:05 AM ET. Last year’s 8-minute speech was short and quick and effective as he outlined the hawkish Fed policy that took rates from 2.5% to the current level of 5.5%. The dollar index moved higher and peaked on September 28, before starting its rotation back to the downside.

Other key data next week includes:

• Flash PMI data out of Europe and the UK on Wednesday
• Flash PMI data out of the US also on Wednesday
• Weekly unemployment claims on Thursday
• German LIFO business climate data on Friday
• Final University of Michigan consumer sentiment index on Friday

Also of note next week is Nvidia will announce their earnings on Wednesday after the close. Given its shocking announcement last quarter (rise of forward guidance revenues to $11 billion from $7 billion estimate), the market will be watching what they announce and project for this quarter and going forward.

Thank you for your support this week. Hope you have a good weekend.

This article was written by Greg Michalowski at www.forexlive.com.

Monthly options expiration was likely a factor in trading today but, in any case, the dip buyers returned and stocks mounted a solid comeback, led by value.

• S&P 500 flat
• Nasdaq Comp -0.2%
• Russell 2000 +0.8%
• DJIA +0.1%
• Toronto TSX Comp +0.1%

On the week:

• S&P 500 -2.1%
• Nasdaq -2.6%
• DJIA -2.2%

This was the third week in a row of declines for the Nasdaq:

This article was written by Adam Button at www.forexlive.com.

The price of Bitcoin this week, finally cracked below its 100-day moving average (blue line in the chart below) for the 1st time since June 21. The price lows over the last few weeks have found support buyers leaning early against that 100-day moving average level, pushing the price back higher.

However, in trading yesterday the 100-average day moving average was broken at $28,538 (blue line in the chart below). The momentum continued with the price moving to – and through – the 200-day moving average at $27,291. That was the 1st break and close below the 200-day moving average since January 12, 2023 (PS. on March 10, the price tested that moving average line and bounced higher).

In trading today, the momentum continued to a low price of $25,600. That got within $23 of the 38.2% retracement target at $25,577. The price has since bounced back to $26,050.

So support held at the 38.2% retracement near $25,577.

What next?

Going forward, the 200 day moving average at $27,291 is now the key resistance level on the daily chart that if the price were to stay below keeps the sellers in play. A move above would be more bearish.

On the downside, a break below a 38.2% retracement and swing area support down to $24,819 would be targeted (see yellow area in the chart below)

This article was written by Greg Michalowski at www.forexlive.com.

Amidst fluctuating global currencies, MUFG delves into the potential for verbal intervention from Japanese officials, especially as the Jackson Hole Symposium approaches, which may carry significant implications from Chairman Powell’s stance.

Key Observations:

1. USD/JPY Surge: There’s been a noteworthy increase in the USD/JPY rate since the Bank of Japan’s (BoJ) policy meeting in July. This uptick is reminiscent of the scenario leading to intervention in the September-October period last year.

2. Intervention Alert Scale: By analyzing previous Japanese language comments linked to past interventions, MUFG’s Tokyo team developed an „Alert Scale.“ Based on this 1-8 scale, the current situation is assessed at about level 6. This suggests that the urgency hasn’t reached the zenith that typically precedes actual interventions.

3. Upcoming Jackson Hole Symposium: Given the proximity of the Jackson Hole meeting, it’s anticipated that Tokyo may escalate its rhetoric. If Chairman Powell delivers a hawkish speech, it could pose challenges for Japan’s monetary stance.

Implications:

• Balancing Act for Japan: Japanese officials are in a tight spot, striving to regulate JGB yields while concurrently curbing JPY’s depreciation. If the USD continues its upward trajectory in the coming week, Tokyo might have to recalibrate its approach.

• Potential Responses: In the event of further escalation of the dollar next week, Japan could react by allowing an uptick in JGB yields, particularly if US yields also rise. This move might be paired with amplified rhetoric. The trajectory of USD/CNY, influenced by PBoC fixings, will also be crucial, as its recent downward correction has acted as a ceiling for USD/JPY.

Conclusion: MUFG underscores Tokyo’s potential for heightened verbal interventions, especially with the Jackson Hole Symposium on the horizon. Depending on Chairman Powell’s remarks, Japan may need to make pivotal decisions, particularly in balancing its yield and currency objectives.

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This article was written by Adam Button at www.forexlive.com.