<p class=“MsoNormal“>Market
picture</p><p class=“MsoNormal“>Bitcoin lost
3.8% on Tuesday, ending it at around $23.2K, and is developing a decline to
$22.9 by Wednesday morning. Ethereum has lost 5.6% in the last 24 hours, to
$1680. Top altcoins are down 2.5% (BNB) to 7.2% (Solana).</p><p class=“MsoNormal“>Total crypto
market capitalisation, according to CoinMarketCap, fell 3.9% overnight to $1.08
trillion.</p><p class=“MsoNormal“>The recovery
in stock indices has choked, but even earlier and more dramatically, these
changes have affected Bitcoin and the whole crypto market. Should the decline
develop, investors and traders should pay close attention to the 21500 area,
where the previous local lows are concentrated. A dip below that and a decisive
return below the 50-day average could well be the start of a new wave of decline
that could take the crypto market to new lows. At least, there might be a test
of the June-July lows.</p><p class=“MsoNormal“>News
background</p><p class=“MsoNormal“>According to
CoinShares, net capital inflows into crypto funds slowed to $3m last week, with
Ethereum accounting for the most investments at $16m. Funds investing in
bitcoin lost $8.5m; those allowing shorting it faced $7.5m in outflows.</p><p class=“MsoNormal“>Michael
Novogratz, CEO of investment firm Galaxy Digital, expects bitcoin to
consolidate in the $20,000-$30,000 range for a while.</p><p class=“MsoNormal“>Circle has
blocked 75K USDC on Tornado Cash mixer wallets, which have come under sanctions
from the US Treasury. According to the agency, attackers have laundered
cryptocurrency worth more than $7 billion since its inception in 2019, with
about $0.5 billion linked to the North Korean hackers Lazarus Group.</p><p class=“MsoNormal“>The Reserve
Bank of Australia is working with the Digital Finance Corporate Research Centre
(DFCRC) to launch a pilot project to explore options for the practical use of
CBDC digital currency.</p><p class=“MsoNormal“>El Salvador
President Nayib Bukele said the legalisation of bitcoin last year contributed
to significant growth in the country’s tourism. </p><p class=“MsoNormal“>Iran
conducted its first import transaction worth $10 million paid in
cryptocurrency, bypassing the global financial system restricted by US
sanctions.</p><p class=“MsoNormal“>This article was written by <a target=“_blank“ href=“mailto:https://www.fxpro.com“ target=“_blank“>FxPro</a>’s Senior Market Analyst Alex
Kuptsikevich.</p>

This article was written by FxPro FXPro at www.forexlive.com.

<p style=““ class=“text-align-justify“>There’s not much in it so far in European morning trade as market players are all waiting on the US CPI data later today before firming up any convictions. Major currencies were more pensive earlier and little changed but we are seeing some light moves now with the dollar slightly softer. That said, it isn’t anything material as the ranges are still relatively contained for the most part.</p><p style=““ class=“text-align-justify“>EUR/USD is up a little to 1.0230 but even then, the range today is not even 30 pips so that kind of exemplifies the lack of meaningful price action for the time being. In the bigger picture, the pair is still caught between 1.0100 and the 50.0 Fib retracement level at 1.0283 and we’ll have to see if the US CPI data later can be a catalyst for any technical pushes this week:</p><p style=““ class=“text-align-justify“>Meanwhile, USD/JPY is still slugging in and around the 135.00 mark as traders are struggling to find any real desire to go chasing firmer moves before we get to the key risk event later. <a target=“_blank“ href=“https://www.forexlive.com/news/the-bond-market-remains-a-key-spot-to-watch-on-the-week-20220810/“ target=“_blank“>The bond market is still a key aspect to watch</a> for the pair so just be mindful of that in confirming any major technical moves later in the week:</p><p style=““ class=“text-align-justify“>Elsewhere, USD/CHF is down 0.4% to 0.9500 and commodity currencies are mildly higher against the greenback but both USD/CAD and AUD/USD are also just holding 30 pips ranges. As such, I wouldn’t read much into it and we’ll only get a better sense of trading sentiment once we are able to digest the US consumer inflation report later today.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>After a bit of a mixed start early on, we are seeing stocks look more guarded now with a bit of a drop ahead of the Wall Street open later. S&P 500 futures have slipped to the lows for the day, down 16 points, or 0.4% currently. Meanwhile, Nasdaq futures are down 0.6% and Dow futures down 0.2% on the day.</p><p style=““ class=“text-align-justify“>Meme stocks stole the headlines to start the week but perhaps the sense of apprehension ahead of the key risk event tomorrow i.e. US CPI data will be the story for today.</p><p style=““ class=“text-align-justify“>Elsewhere, European indices are extending declines as well with the DAX down 1.2%, CAC 40 down 0.6%, and Eurostoxx down 1.0%.</p>

This article was written by Justin Low at www.forexlive.com.

<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/oil-jumps-as-russia-reportedly-suspends-oil-flows-via-southern-leg-of-druzhba-pipeline-20220809/“>Oil jumps as Russia reportedly suspends oil flows via southern leg of Druzhba pipeline</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/euro-nudges-a-little-higher-on-the-day-20220809/“>Euro nudges a little higher on the day</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/boes-ramsden-does-not-rule-out-rate-cuts-in-the-next-year-20220809/“>BOE’s Ramsden does not rule out rate cuts in the next year</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/us-july-nfib-small-business-optimism-index-899-vs-895-prior-20220809/“>US July NFIB small business optimism index 89.9 vs 89.5 prior</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/china-military-says-it-will-continue-drills-around-taiwan-today-20220809/“>China military says it will continue drills around Taiwan today</a></li></ul><p>Markets:</p><ul><li>EUR leads, CAD lags on the day</li><li>European equities lower; S&P 500 futures down 0.2%</li><li>US 10-year yields up 3.6 bps to 2.80%</li><li>Gold up 0.1% to $1,791.13</li><li>WTI crude up 1.3% to $91.91</li><li>Bitcoin down 3.1% to $23,320</li></ul><p style=““ class=“text-align-justify“>It was a quiet session with little in terms of headlines or narratives for market participants to work with. The lull is a reflection of one of those summer’s day in Europe with not much to really pin any market moves on.</p><p style=““ class=“text-align-justify“>The euro crept higher a little alongside the pound as the dollar was a little sluggish but ultimately, the moves aren’t anything that stands out from a technical perspective. EUR/USD moved up from 1.0200 to 1.0247 before holding around 1.0220 levels now.</p><p style=““ class=“text-align-justify“>USD/JPY remains more pensive in and around the 135.00 mark as bond yields push a little higher after yesterday’s drop. All eyes are on the US CPI data tomorrow to really firm up any convictions.</p><p style=““ class=“text-align-justify“>Meanwhile, commodity currencies are a fair bit languid but the ranges against the dollar remains somewhat tight (less than 30 pips) so I wouldn’t look much into it. AUD/USD is down 0.2% to 0.6970 levels now as risk appetite is sapped a little with US futures trading slightly lower ahead of North America trading.</p><p style=““ class=“text-align-justify“>The US consumer inflation report in the day ahead can’t come soon enough.</p>

This article was written by Justin Low at www.forexlive.com.

<ul><li>Prior 89.5</li></ul><p style=““ class=“text-align-justify“>Small business optimism in the US edged up a little in July as fuel prices eased and job openings were marginally easier to fill. That said, inflation worries are continuing to intensify with 37% of business owners reporting that inflation was their most important problem – the highest share since Q4 1979.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>At the lows today, WTI <a target=“_blank“ href=“https://www.forexlive.com/terms/c/crude-oil/“ target=“_blank“ id=“e1f1b115-23d2-48c8-98c8-24024dada457_1″ class=“terms__main-term“>crude oil</a> was down to $89.05 but was holding around $90.00 before the headlines crossed. It is now trading up to $91.70 as Reuters is reporting that Russia has suspended oil exports via the southern leg of the Druzhba pipeline amid transit payment issues.</p><p style=““ class=“text-align-justify“>It is said that the payment from Russia’s pipeline monopoly, Transneft, to Ukraine’s pipeline operator, Ukrtransnafta, did not go through. For some context, the flows here i.e. southern part of the Druzhba pipeline, goes towards Hungary, Czech Republic, and Slovakia.</p><p style=““ class=“text-align-justify“>Update: Transneft has come out to say that the northern part of the pipeline, in which flows goes towards Germany, is unaffected.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>Sometimes it is best to be reminded of what goes beyond the headlines and when it comes to inflation numbers, markets may tend to get a bit carried away. So, it is always good to be wary and look in between the lines and not just overreact to what you see on the screens.</p><p style=““ class=“text-align-justify“>German inflation hasn’t quite shown signs of peaking just yet with the <a target=“_blank“ href=“https://www.forexlive.com/news/germany-july-preliminary-cpi-75-vs-74-yy-expected-20220728/“ target=“_blank“>July numbers</a> coming in higher than estimated. Sure, the headline figure (7.5%) might be off the May high of 7.9% but the EU-harmonised reading (8.5%) was higher than that of June, increasing to just shy of the record high seen in May at 8.7%.</p><p style=““ class=“text-align-justify“>With CPI data set to be a key focus everywhere in the months ahead, it is vital to be aware of the nuances and the possible factors impacting the numbers. In the case for Germany, the government had introduced subsidies on fuel and rail tickets for the months of June, July and August.</p><p style=““ class=“text-align-justify“>They slashed taxes on both petrol and diesel for the three months, although prices at the pump are still lofty. But they also introduced a public transport travel pass, which is effective for a travel period of one month, for just €9.</p><p style=““ class=“text-align-justify“>German finance minister, Christian Lindner, has already poured cold water on the idea that the ‚9-euro travel pass‘ will be extended. As such, there might be a spike in prices again come September when the subsidies are retired.</p><p style=““ class=“text-align-justify“>That will be something to be mindful about in case we do see another jump in German consumer inflation numbers for the month.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>The jump higher in the dollar after the US jobs report on Friday was encouraging but there still needs to be more in order to vindicate a return back to the year’s highs for the greenback. For now, the price action today suggests that market players are not convinced and USD/JPY tipping back below 135.00 is but a testament to that.</p><p style=““ class=“text-align-justify“>While buyers managed to recover well from a drop towards 130.00 last week, the rebound here isn’t suggestive of a return towards 140.00 yet either. For that, the bond market needs to play ball and for now, that isn’t quite the case. 10-year Treasury yields are down 4 bps today to near 2.79% upon encountering resistance at the 100-day moving average:</p><p style=““ class=“text-align-justify“>That continues to be quite a defining technical point for the bond market at the moment. As such, that might be enough to keep USD/JPY pinned down below 135.00 as well.</p><p style=““ class=“text-align-justify“>Looking ahead this week, all the focus will be on the US CPI data on Wednesday and I reckon only until we get there will there be any real convictions for traders to firmly challenge key technical points on the charts.</p>

This article was written by Justin Low at www.forexlive.com.

<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/commodity-currencies-lead-as-risk-appetite-improves-to-start-the-week-20220808/“>Commodity currencies lead as risk appetite improves to start the week</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/usdjpy-fails-to-hold-above-13500-on-the-day-20220808/“>USD/JPY fails to hold above 135.00 on the day</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurozone-august-sentix-investor-confidence-252-vs-247-expected-20220808/“>Eurozone August Sentix investor confidence -25.2 vs -24.7 expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/germany-reaffirms-that-it-rules-out-approval-of-nord-stream-2-pipeline-20220808/“>Germany reaffirms that it rules out approval of Nord Stream 2 pipeline</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/china-says-will-continue-military-drills-around-taiwan-today-20220808/“>China says will continue military drills around Taiwan today</a></li></ul><p>Markets:</p><ul><li>NZD leads, USD lags on the day</li><li>European equities higher; S&P 500 futures up 0.5%</li><li>US 10-year yields down 3 bps to 2.80%</li><li>Gold up 0.4% to $1,782.03</li><li>WTI crude down 1.3% to $87.88</li><li>Bitcoin up 5.3% to $24,171</li></ul><p style=““ class=“text-align-justify“>It was a slow start to the proceedings initially but there were some decent moves as European trading kicked into gear. The aussie and kiwi were slightly higher in Asia trading but ramped up the pressure during the session as equities also pulled higher, continuing the recovery mood from late last Friday.</p><p style=““ class=“text-align-justify“>In turn, the dollar dropped alongside bond yields as markets get settled in with all eyes focused on the US CPI data on Wednesday. That will provide another key risk event for traders to scrutinise, so we’re not seeing the post-NFP reaction get carried away.</p><p style=““ class=“text-align-justify“>But for stocks, the positive mood is flowing as European indices are posting modest gains around 0.5% to 0.9% while US futures are up around 0.5% as we look towards the session ahead.</p><p style=““ class=“text-align-justify“>AUD/USD kept higher around 0.6935 before pushing gains to 0.6970 levels at the moment. Meanwhile, NZD/USD is up nearly 1% on the day now as it extended early gains from 0.6250 to 0.6280 levels currently. For the aussie, it is still shy of reclaiming the critical 0.7000 level and that will be one to watch in trading this week.</p><p style=““ class=“text-align-justify“>Elsewhere, EUR/USD is keeping a light advance around 1.0200 with GBP/USD clawing its way back above 1.2100 but the gains on both fronts aren’t anything to shout about.</p><p style=““ class=“text-align-justify“>USD/JPY was a notable mover as it fell from 135.20 to 134.60 as buyers failed to hold a firm break above 135.00 in light of a retreat in Treasury yields.</p><p style=““ class=“text-align-justify“>It looks like we may be entering the phase where markets are looking more pensive and a bit of a push and pull ahead of the US CPI data on Wednesday.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>This isn’t a new development but it just reaffirms that we are not looking towards that despite the fact that a looming gas crisis is looming over the country and Europe in general. For some context, Russia had touted that the new pipeline would bring about additional 55 billion cubic meters of gas per year to Germany.</p>

This article was written by Justin Low at www.forexlive.com.