2023/03/16 (192.055) Technical Analysis

The 1st Battle For Us Bulls In BITCOIN At 20000 Has Been Won
– In Order To Win In Long-Term, 30000 Must Be Reconquered Medium-Term

Joseph Stiglitz is considered one of the most renowned economists of our time.
The economist, who is also valued by me, is politically classified on the semi-left flank; from me too. Nevertheless, as with most economists, there are always a few aspects in his case that can be accepted as right – and not wrong, because he feels he belongs to a different political current. I like Stiglitz because he doesn’t beat around the bush, as we say here in Germany. The outspoken Nobel laureate’s views carry weight – mostly by the US Democrats. His comments on the Fed’s monetary policy at the beginning of 2023 are likely to be of great interest to us financial market participants.

For almost a year, the Fed has reacted to persistently high inflation rates with offensive interest rate hikes.
During this period, the US interest rate rose from zero to over four percent. Many other central banks such as the ECB, the Bank of England and the Swiss National Bank (SNB) followed suit and gave up their low interest rate policy. Even the Bank of Japan (BoJ), which has been seen as particularly dovish in recent years, has taken tentative steps towards tightening. Economics Nobel Prize winner Joseph Stiglitz, who served as chief economist at the World Bank between 1997 and 2000, considers the restrictive monetary policy to be a mistake with serious consequences. I don’t – to make it clear upfront. And with all love and respect. Because when I read, hear and/or see something by Stiglitz, I always deal with it – and form my own opinion. Whatever you should do.

In an article published in the British daily newspaper “The Guardian” at the end of January,
Joseph Stiglitz criticized the current monetary policy of the US Federal Reserve with harsh words.
In his opinion, the Fed’s interest rate rate is based on incorrect assumptions. The US Federal Reserve incorrectly thought that too much demand from consumers and companies met too little supply of goods, which caused prices to develop upwards. Interest rate increases were therefore necessary to reduce the demand for goods and services. The US economy will also have to put up with a recession, as Fed Chairman Jerome Powell emphasized several times in widely acclaimed speeches. A declining demand situation is therefore essential for restoring long-term price stability, especially since otherwise there is a risk of a wage-price spiral. However, Stiglitz has a very different opinion on how inflation came about. “There is overwhelming evidence that the main cause of inflation was pandemic-related supply shocks and shifts in the demand structure, not excess aggregate demand, much less additional demand created by pandemic spending,” the Nobel laureate said. Therefore, interest rate hikes were not necessary: “Anyone who has a little faith in the market economy knew that the supply problems would eventually be solved; but nobody could know when.” I disagree with him on this – 100% diametrically! Because he argues like an expansive fiscal policy dove from the Corona period. And in retrospect he also blames the restrictive, hawkish FED policy. And what is the FED doing? In the person of your Chairman Powell, he is too much diplomatic in public to react to such criticism. And always refers to his mandate of inflation and unemployment.

Don`t understand me wrong – or suggest a conflict between me and Stiglotz.
I simply prefer a basically an hawkish policy. So don`t understand me wrong! It`s not about who`s right! It`s all about which us fiscal policay and/or monetary policy have a majority. And I just can’t help myself zo resolve the us economy without the picture of Biden’s Cain economic policies. Because his green opposite economic policy was and is responsible for today`s us economic scenario. Just look at US inflation during Donald Trump’s time – and the rise since Biden had the final say in the White House. But at least the pressure for a higher oil price, since the beginning of this week, should be tacitly gone, if I’m not mistaken. And that regardless of the demand from China, let alone Russia’s war of aggression. Because Theran and/or Ryal seem to agree peacefully – and that thanks the help of the Chinese and not US Americans. That`s why we remain short in the oil price. But that’s just by the way.

Stiglitz is considered a neo-Keynesian economist
who generally advocates low interest rates and financial generosity on the part of the state.
What the US inflation demands, yes even conjures up, is the logical consequence if US production, i.e. the supply of goods and services, namely material goods and non-material service offers, is not at least as high. Because when US inflation overruns US GDP in the truest sense of the word, then we will all experience what we are experiencing together in the USA; namely an US stagflation. Hardly anyone talks about it in public – except for Nourinel Roubini. In this sense, Stiglitz calls for a generally low level of interest rates and government stimulus packages. On the other hand, there are some economists who think the Fed’s interest rate policy doesn’t go far enough. For example, the “Black Swan” author Nassim Taleb accuses the Fed, ECB & Co. of having created “malignant tumors like Bitcoin with their ultra-liquid monetary policy in recent years.“ Therefore, all central banks urgently need to return to an interest rate of four to five percent as quickly as possible and maintain this higher level. This is the only way that future stock market excesses can be avoided and investors’ investments can once again achieve greater economic benefits. “Dr. Doom” Nouriel Roubini is a notorious critic of the Fed’s interest rate policy, which he sees as a major reason for the escalating debts of states and “zombie companies”. A less liquid monetary policy is not only necessary to reduce inflation, but also to tame the ominous speculation frenzy of many investors. I agree. But roday 2023 we currently have several generations of financial market participants who only know US inflation from books. As well as a generation that only knows low interest rates. And that`s why I assume that we will deal with us inflation, even us staglation, longer as we would like. And I let myself be persuaded to formulate a BITCOIN long 4XSetUp. How exactly? That every day this week in the Technical Analysis 4XSetUps…Hammer Candles Initiate The Turnaround, But High RSI Values Call For Caution

Hammer candles are characterized by long lower shadows and a much smaller body. Although the bears were able to create new lows, they were unable to maintain the price at this level. Instead, at horizontal support, buyers must have returned to the market and bought enough that the daily and weekly closes were well above the low. The bullish price patterns of the past few days are supporting the turnaround sentiment that is becoming more apparent as the breakout of the recent movement highs. There have also been buy signals in the Relative Strength Index (RSI) and MACD, giving further impetus to the digital currency. On Tuesday, the MACD managed to rebound above the zero line and turn back into positive territory. The MACD is thus once again signaling a bullish market environment. If confirmed, the breakout would open the way for follow-up buying towards $28,000. Here is the next potential resistance. Above that, more technical hurdles follow at $28,600 and $29,296 before the $30,000 mark comes into focus.

The increasingly overbought market situation calls for caution. The RSI has been rising significantly recently and is close to entering the overbought market zone, which starts at the 70 levels. In the weekly chart, the RSI still has a little more room for improvement. Here the value is currently 61.56.

Renowned Economist Nouriel Roubini,
Known For His Apocalyptic Forecasts And/Or Criticism Of Cryptocurrencies,
Yesterday Addressed The Thorny Situation The Markets Are Currently Grappling With

In an interview with Stansberry Research, Roubini argued that there are many miscasts within the crypto ecosystem and that the end of the asset class is near.
According to Roubini, cryptocurrencies cannot fulfill the role of a store of value and are “very risky”. “They are very risky. The lesson from the last year and a half is that crypto is extremely dangerous. There are so many scammers, so many cases of abuse. As you know, SBF and FTX are not the exception – it is the rule,” he said. He also opined that “this whole crypto house of cards is collapsing,” adding, “If you want your wealth to be safe, the last place you want it to be is in cryptocurrencies.” It’s worth noting that Roubini seems to have missed the fact that cryptocurrencies have so far been the asset class (along with gold) that has best withstood the current panic in the markets. Emphasizing the high volatility of Bitcoin and cryptocurrencies in general, Roubini also suggested that the failures of Silvergate Bank and Silicon Valley Bank were due to their exposure to the crypto market and cryptocurrency industry: “We’re talking Silicon Valley Bank. But get this. In the last week, two major crypto banks have gone bankrupt. Silvergate and now Signature Bank (NASDAQ:SBNY). Because, once again, they were running toxic businesses and the People who had deposits there may or may not need to be rescued.”

However, BITCOIN Futures may be before a mega 4XSetUp?
But only if you`re thinkung that the macro backdrop is perfect for an upcoming Armageddon
The ongoing US banking crisis prompted the US Federal Reserve to intervene in the deadlock. The Fed announced that it stands ready to address any type of liquidity pressure that might arise from here. Additional funds will be made available with the establishment of the Bank Term Funding Program (BTFP). The newly established BTFP aims to offer loans with maturities of up to one year to banks, credit unions and other eligible deposit-taking institutions. The bailout is scheduled to expire on March 17, 2023, and Arthur Hayes, co-founder of crypto exchange BitMEX, believes it can have a positive impact on the crypto industry. BitMEX CEO stated that the BTFP rescue report is the most important financial event since COVID. A few days ago he emphasized that the Bitcoin Bull Run will start due to the additional liquidity and rising inflation.

To put it technically in a nutshell,
the BITCOIN Future is showing strong development within an uptrend channel in the medium term.
This signals increasing investor optimism and suggests further price increases for Bitcoin. The currency broke a resistance level and generated a buy-signal from the long-term trading range. The price chart has no resistance and suggests further price advance. In the event of counter-reactions, the currency has support at around 25000 points. Overall, the currency is considered technically positive over the medium term.