Wall St set to extend gains on solid consumer spending data, easing prices

By Ankika Biswas and Shreyashi Sanyal

(Reuters) -Wall Street was set to extend gains on Thursday after data showed a mild easing in inflation and solid consumer spending in October, adding to hopes of a likely downshift in the Federal Reserve’s policy on aggressive rate hikes.

A reading from the Commerce Department showed consumer spending, which accounts for more than two-thirds of U.S. economic activity, rose 0.8% after an unrevised 0.6% increase in September.

The core personal consumption expenditure (PCE) index, excluding volatile items, eased to 0.2%, against expectations of 0.3%.

“People are feeling that the worst is behind us,” said Sam Stovall, chief investment strategist at CFRA Research in New York.

“Today’s PCE was sort of a confirmation that indeed inflation is coming down and would offer credibility to the likelihood that the Fed will raise rates by 50 basis points in December and then probably end its rate tightening program in the latter part of the first quarter.”

This added to optimism after Fed Chair Jerome Powell said on Wednesday it was time to slow down coming interest rate hikes, while also signaling a protracted economic adjustment amid high borrowing costs.

The S&P 500 index closed above its 200-day moving average for the first time since April in the previous session, while the Nasdaq index ended over 4% higher.

Powell, however, cautioned that the fight against inflation was far from over and indicated that the terminal rate will be “somewhat higher” than the 4.6% indicated by policymakers in their September projections.

Traders are now seeing a 91% chance that the Fed will increase its key benchmark rate by 50 basis points in December, with the terminal rate expected to peak under 5% in May 2023. [FEDWATCH]

Investors also await nonfarm payrolls data on Friday, with the ADP report on Wednesday suggesting cooling demand for labor.

Separately, a report from the Labor Department on Thursday showed initial claims for state unemployment benefits dropped 16,000 to a seasonally adjusted 225,000 for the week ended Nov. 26.

At 8:53 a.m. ET, Dow e-minis were up 38 points, or 0.11%, S&P 500 e-minis were up 12.5 points, or 0.31%, and Nasdaq 100 e-minis were up 34.75 points, or 0.29%.

Most megacap technology and growth stocks such as Alphabet Inc, Apple Inc, Microsoft Corp, Tesla Inc and Meta Platforms Inc reversed earlier declines to rise between 0.2% and 0.5% amid a dip in Treasury yields.

Salesforce Inc lost 7.1% in premarket trading on Thursday after the software maker said Bret Taylor would step down as co-chief executive officer in January and that co-founder Marc Benioff will become the sole CEO.

Costco Wholesale Corp fell 3.2% after the membership-only retail chain reported slower sales growth in November.

(Reporting by Ankika Biswas and Shreyashi Sanyal in Bengaluru; Additional reporting by Bansari Mayur Kamdar and Shubham Batra; Editing by Shounak Dasgupta)

S&P 500 Index, NASDAQ Composite Rise Following Tame PCE Inflation Report

The October Core Personal Consumption Expenditures Index rose 0.2%, below the consensus estimate of 0.3% collected from economists by Dow Jones. Annual PCE inflation dropped slightly to 5.0% from 5.1%.

Personal Income in October rose 0.7%. Greater than the 0.4% forecast and previous reading.

Personal Spending rose 0.8%, matching the estimate.

In other news, Weekly Unemployment Claims came in at 225K, lower than the 234K forecast and previous week’s reading.

Traders are now bracing for the latest ISM Manufacturing PMI report, due to be released at 15:00 GMT. It is expected to show a contraction to 49.7, down from 50.2.

Market Reaction

The benchmark S&P 500 Index and the tech-heavy NASDAQ Composite surged after the release of the economic data as the news reaffirmed Federal Reserve Chairman Jerome Powell’s comments from Wednesday that indicated inflation had pulled back enough to warrant a slowdown in the pace of future Fed rate hikes.

Treasury yields fell on the news, weakening the U.S. Dollar and making dollar-denominated gold a more attractive investment. Gold hit a three-month high.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Bulls Hoping PCE Price Index Signals Cooling Inflation

The major U.S. stock index futures are trading lower on Thursday, shortly before the release of several key reports that will offer traders fresh insights into how high interest rates and inflation are affecting consumers, as personal spending and income figures for October will be published. Investors are likely to pay the most attention to the PCE price index, the Fed’s favorite inflation gauge, due to be released at 13:30 GMT.

At 12:46 GMT, Dow Jones Industrial Average futures are trading 34574.00, down 25.00 or -0.07%, the S&P 500 Index futures contract is at 4083.50, up 2.25 or +0.06% and the NASDAQ Composite is trading 12040.75, down 1.50 or -0.01%.

Job Cuts Rise in November

In keeping with this week’s labor market theme, the rate of job cut announcements at U.S. employers in November was more than five times greater than a year ago, according to a report by Challenger, Gray & Christmas. Overall, U.S.-based firms announced 76,835 job cuts in November, led by the technology sector. So far this year, tech companies have announced nearly 81,000 cuts.

Salesforce Shares Fall as Co-CEO Announces Departure

Shares of software company Salesforce are expected to open lower on Thursday after slumping more than 6.5% in overnight trading.

The stock fell after co-CEO Bret Taylor announced he was leaving the company. The departure leaves Marc Benioff alone as the sole CEO of the company.

The decline in shares came despite a beat on the top and bottom lines in the recent quarter. Earnings per share guidance for the fourth quarter came in above estimates.

Snowflake Shares Lower Ahead of Cash Market Opening

Snowflake’s shares were last down more than 5% in overnight trading after the company shared product revenue guidance that fell short of expectations.

Snowflake said it expects product revenue to range between $535 and $540 million in the fourth quarter. Analysts expected an estimate of $553 million, according to Street Account.

Daily Forecast

We’re expecting increased volatility ahead of the cash market opening as investors get the opportunity to react to a slew of reports on inflation, spending and income at 13:30 GMT.

The October PCE price index should show a 0.4% increase versus September. Year over year, PCE inflation should cool to 6% from September’s 6.2%. Core PCE, which excludes food and energy, is expected to be up 0.3%. The core PCE inflation rate is seen dipping to 5% from September’s 5.1%.

Bullish investors are hoping to see a cooling in PCE inflation after Fed Chair Jerome Powell said rate hikes could slow beginning in December. In order to make this happen, inflation is going to have to show signs of abating. If the PCE inflation remains too hot then this will cast doubts about whether the Fed could pull back on its aggressive rate hikes. This would be a negative for stock prices.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Closed Above 200MA For The First Time Since March

S&P 500 and Dow in Detail

Technically, the S&P500 closed back above its 200-Day Moving Average for the first time since March on a trifecta of bullish headlines i.e., Fed Chair Jerome Powell delivering a more dovish speech than the trade was anticipating, the Chinese easing Covid restrictions in some parts of the country, and the US House of Representatives passing a resolution 209-137 that would force railroad unions to accept a tentative agreement reached earlier this year between railroad managers and their workers and make an imminent strike illegal.

Technically, the Dow is now no longer in a “bear” market, having risen +20% from its most recent low. Year-to-date, the Dow is still down -4.7%, while the S&P 500 is down over -14% and the Nasdaq is down almost -27%.

Bulls however have a renewed sense of optimism after Fed Chair Jerome Powell delivered slightly less hawkish remarks, the Fed chief indicated that interest rate hikes would be scaled back to 50-basis points starting at the December 13-14 meeting. Still, Powell repeated previous warnings that Fed policy will likely still have to remain tight “for some time” to restore price stability and said substantially more evidence of declining inflation was still needed.

The real bullish takeaway from Powell’s comments, however, is that Fed’s target rate for this tightening cycle would likely only be slightly higher than previously forecast in September.

The median projection at that time was for rates to top out at 4.6%, which implies a target range of 4.5% – 4.75%. The benchmark currently sits at 3.75% – 4%. Bulls are also getting a boost from a flurry of economic data that indicates clear signs of a slowing US economy. Remember, “bad news” is played as “good news” in this world because it means the Fed will slow down on tightening.

Labor Market Situation

One area of particular focus for the Fed has been the ultra-tight jobs market. Good news on that front was found in the Job Openings and Labor Turnover Survey yesterday which showed a decline of -353,000 openings from the previous month.

The more important test will be the November Employment Report due out on Friday. Data from ADP yesterday showed a much less-than-expected gain in private payrolls of just 127,000 and bulls are hoping that same weakness is revealed in the official data.

On the flip side, third-quarter GDP was revised up to an annualized +2.9% from a prior estimate of +2.6%, which some bears view as a sign that the Fed’s tightening campaign still has much further to go.

There remains a good deal of unease about the inflation trajectory due to a still-strong US consumer, as well as the many uncertainties surrounding global oil supplies.

Oil prices yesterday moved higher after data showed US stockpiles fell by the most since 2019 last week, according to Energy Information Administration. With Russian supplies set to be disrupted, China maybe reopening soon (big maybe), and OPEC waffling between production cuts and increases, oil traders are expecting more volatility ahead.

It’s worth noting that US gas prices have moved substantially lower, hitting an average of $3.50 a gallon yesterday, according to AAA. Some experts think the national price average could slide below $3 by Christmas. On the surface, that sounds great for inflation but keep in mind, that means more money in consumer pockets, which in turn could boost discretionary spending and continue to buoy inflation.

Data to Watch

Today, investors are anxious to see the PCE Prices Index, one of the Fed’s favorite inflation gauges. Wall Street is expecting year-over-year inflation will drop to +6% from +6.2% previously. ISM Manufacturing and Construction Spending data are also due today.

Earnings of interest today include ChargePoint, Dollar General, Kroger, Nintendo, and Ulta.

ADA Price Prediction: Bulls Eye $0.330 on Softer US Inflation Numbers

Key Insights:

  • On Wednesday, ADA rose by 3.24% to end the day at $0.319.
  • News of China planning to ease COVID-19 lockdown measures and Fed Chair Powell delivered a bullish session.
  • However, ADA was under pressure this morning, with US inflation figures capable of derailing Powell’s pivot talk.

On Wednesday, ADA rose by 3.24%. Following a 0.98% gain from Tuesday, ADA ended the day at $0.319.

A mixed start to the day saw ADA fall to an early morning low of $0.308. Steering clear of the First Major Support Level (S1) at $0.305, ADA rose to a late high of $0.321. ADA broke through the First Major Resistance Level (R1) at $0.324 and the Second Major Resistance Level (R2) at $0.316 to end the day at $0.319.

Fed Chair Powell and the NASDAQ Composite Index Deliver ADA Support

On Wednesday, investor sentiment towards the protests across China shifted. Reports of the Chinese government planning to ease lockdown measures supported a breakout morning. However, apprehension ahead of Fed Chair Powell’s speech and mixed US economic indicators led to a pullback before a late rally.

Fed Chair Powell talked about easing the pace of interest rate hikes, driving demand for riskier assets. The NASDAQ Composite Index rallied by 4.41%, with the crypto market ending the session up 3.98% to $820.7 billion.

There were no network updates from Input Output HK or founder Charles Hoskinson to influence ahead of tomorrow’s weekly development update.

The lack of network updates will likely leave ADA in the hands of the US economic calendar and the NASDAQ Composite Index today. Softer inflation figures and dovish FOMC member chatter would support another bullish session.

The NASDAQ mini was down 34 points this morning.

ADA Price Action

This morning, ADA was down 0.31% to $0.318. A bearish morning saw ADA fall from an early high of $0.320 to a low of $0.314 before steadying.

ADA in the red.
ADAUSD 011222 Daily Chart

Technical Indicators

ADA needs to avoid the $0.316 pivot to retarget the First Major Resistance Level (R1) at $0.324. A move through the Wednesday high of $0.321 would signal a breakout session. However, ADA would need price-friendly US stats, FOMC member chatter, and IOHK updates to support a bullish session.

In the event of an extended rally, the Second Major Resistance Level (R2) at $0.329 and $0.335 would likely come into play. The Third Major Resistance Level (R3) sits at $0.342.

A fall through the pivot would bring the First Major Support Level (S1) at $0.311 into play. However, barring a risk-off-fueled sell-off, ADA should avoid sub-$0.305 and the Second Major Support Level (S2) at $0.303.

A pickup in US inflationary pressure could reverse bets of a Fed pivot that would bring S2 ($0.303) into view.

The Third Major Support Level (S3) sits at $0.290.

ADA resistance levels in play above the pivot.
ADAUSD 011222 Hourly Chart

This morning, the EMAs and the 4-hourly candlestick chart (below) sent a bearish signal.

ADA sat below the 100-day EMA, currently at $0.323. The 50-day EMA narrowed to the 100-day EMA, while the 100-day EMA eased back from the 200-day EMA, delivering mixed signals.

An ADA breakout from the 100-day EMA ($0.323) and R1 ($0.324) would support a run at R2 ($0.329). However, a slide through the 50-day EMA ($0.314) would support a fall through S1 ($0.311) to bring S2 ($0.304) into view.

EMAs remain bearish.
ADAUSD 011222 4-Hourly Chart

 

ETH Bulls to Target $1,400 on Softer Inflation and Dovish Fed Chatter

Key Insights:

  • Bitcoin (BTC) and ethereum (ETH) joined the broader crypto market in another bullish crypto session on Wednesday.
  • Easing FTX contagion risk, reports of China planning to ease COVID-19 restrictions, and Fed Chair Powell delivered a breakout session.
  • However, it has been a mixed morning session, with investor focus shifting to the US economic calendar.

Ethereum (ETH) rallied by 6.50% on Wednesday. Following a 4.20% gain on Tuesday, ETH ended the day at $1,295. ETH visited $1,300 for the first time since November 11.

A bullish start to the day saw ETH rally from an early low of $1,1212 to a late high of $1,312. ETH broke through the First Major Resistance Level (R1) at $1,1243 and the Second Major Resistance Level (R2) at $1,270 to end the day at $1,295.

On Wednesday, bitcoin (BTC) rallied 4.42%. Following a 1.48% gain on Tuesday, BTC ended the day at $17,180. Notably, BTC wrapped up the day at $17,000 for the first time since early November.

A mixed start to the day saw BTC fall to an early low of $16,446. Steering clear of the First Major Support Level (S1) at $16,187, BTC surged to a late high of $17,275. BTC broke through the First Major Resistance Level (R1) at $16,631 and the Second Major Resistance Level (R2) at $16,810. The Third Major Resistance Level (R3) at $17,254 capped the upside.

Reports of the Chinese government planning to ease COVID-19 lockdown measures delivered early support. However, Fed Chair Powell fueled demand for riskier assets late in the Wednesday session.

Powell talked of slowing the pace of interest rate hikes, supporting the bets of a December Fed pivot. The NASDAQ Composite Index rallied by 4.41%, with the S&P500 gaining 3.09%.

After briefly decoupling, BTC and ETH tracked the NASDAQ Composite Index through the US session.

Later today, the US economic calendar will be back in focus, with inflation and personal spending due. A spike in US inflation could unravel Powell’s plans to take the foot off the gas. With US stats in focus, FOMC member chatter will also need monitoring.

NASDAQ correlation
NASDAQ BTC ETH Correlation – 011222 Daily Chart

The NASDAQ mini was down 39.25 points this morning, with BTC and ETH also in consolidation mode.

Ethereum (ETH) Price Action

At the time of writing, ETH was down 1.09% to $1,281. A bearish morning saw ETH fall from an early high of $1,296 to a low of $1,276.

ETH under pressure.
ETHUSD 011222 Daily Chart

Technical Indicators

ETH has to avoid a fall through the $1,1273 pivot to target the First Major Resistance Level (R1) at $1,334. Softer US inflation numbers and dovish FOMC member chatter would support a breakout from the Wednesday high of $1,312.

In the event of an extended rally, the Second Major Resistance Level (R2) at $1,363 and $1,400 would likely come into play. The Third Major Resistance Level (R2) sits at $1,473.

A fall through the pivot would bring the First Major Support Level (S1) at $1,234 into play. However, barring an extended afternoon sell-off, ETH should avoid sub-$1,200 and the Second Major Support Level (S2) at $1,173.

The Third Major Support Level (S3) sits at $1,073.

ETH resistance levels in play.
ETHUSD 011222 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. Ethereum sat above the 200-day EMA, currently at $1,277. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A hold above the 200-day EMA ($1,277) would support a breakout from R1 ($1,334) to target R2 ($1,373) and $1,400. However, a fall through the 200-day EMA would give the bears a run at S1 ($1,234) and the 100-day ($1,230).

EMAs turn bullish.
ETHUSD 011222 4 Hourly Chart

Bitcoin (BTC) Price Action

At the time of writing, BTC was down 0.47% to $17,100. A mixed morning saw BTC rise to an early high of $17,271 before falling to a low of $17,072.

BTC sees red.
BTCUSD 011222 Daily Chart

Technical Indicators

BTC needs to avoid the $16,967 pivot to target the First Major Resistance Level (R1) at $17,488. A move through the Wednesday high of $17,275 would signal an extended breakout session. However, BTC would need US stats, FOMC member commentary, and friendly FTX-linked news updates to support a run at $18,000.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $17,796 and resistance at $18,000 before any pullback.

The Third Major Resistance Level (R3) sits at $18,625.

A fall through the pivot would bring the First Major Support Level (S1) at $16,659 into play. Barring an extended sell-off, BTC should avoid sub-$16,500 and the Second Major Support Level (S2) at $16,138. The Third Major Support Level (S3) sits at $15,309.

BTC resistance levels in play.
BTCUSD 011222 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, bitcoin sat above the 100-day EMA, currently at $16,834. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R1 ($17,488) and the 200-day EMA ($17,510) would support a breakout from R2 ($17,796) to target $18,000. However, a fall through the 100-day EMA ($16,824) would bring S1 ($16,659) and the 50-day EMA ($16,631) into view.

EMAs turning bullish.
BTCUSD 011222 4 Hourly Chart

 

XRP Price Volatility to Pick Up as Focus Shifts To SEC v Ripple Filings

Key Insights:

  • On Wednesday, XRP rose by 2.43%, marking the eighth gain in ten sessions.
  • A less hawkish Fed Chair Powell and optimism toward the SEC v Ripple case delivered XRP price support.
  • The technical indicators are bullish, with XRP sitting at the 200-day EMA, signaling a possible return to sub-$0.45.

On Wednesday, XRP rose by 2.43%. Following a 2.36% gain from Tuesday, XRP ended the day at $0.40786. Notably, XRP ended the day at $0.40 for the first time in five sessions.

A choppy start to the day saw XRP rise to an early high of $0.40842. XRP broke through the First Major Resistance Level (R1) at $0.4069 before sliding to a late afternoon low of $0.39288.

However, steering clear of the First Major Support Level (S1) at $0.3862, XRP rallied to a late-day high of $0.41147 before easing back. XRP broke back through R1 to end the day at $0.40786.

SEC v Ripple Activity Takes a Backseat to a Less Hawkish Fed Chair

Updates from the ongoing SEC v Ripple case will become a focal point from today.

The SEC and the defendants filed their Replies to the Oppositions to the Motions for Summary Judgment on Wednesday. As per the Court schedule, the filings are under seal, with redacted versions available to the public by Monday, December 5.

However, defense attorney James Filan pointed out that the parties may make redacted versions available sooner.

Filan also shared his views on the timing vis-à-vis the Hinman documents. Filan noted three major outstanding issues, including sealing-related issues regarding the expert reports, the Hinman documents, and other materials.

Filan believes that Judge Torres will not give a separate ruling on the sealings. Any documents she relies upon for giving her ruling will be considered a judicial document and therefore become available to the public.

Filan’s view aligns with those who believe that the SEC will settle should the defendants reference the Hinman speech-related documents in the Summary Judgment Reply briefs. In cases where Judge Torres considers the Hinman documents, these would become available to the public.

In a famous 2018 speech, Division of Corporation Finance, William Hinman, said that Bitcoin (BTC) and Ethereum (ETH) are not securities.

By way of history, the SEC failed to shield the Hinman speech-related documents on more than six occasions. The sheer number of failed attempts reflects the SEC’s desire to prevent the documents from becoming public.

While investors wait for the redacted versions, XRP remains in the hands of the broader crypto market.

On Wednesday, Fed Chair Powell delivered a less hawkish speech, driving demand for riskier assets. US economic indicators and Fed commentary will likely influence later today.

However, investors will need to look out for the redacted versions that could surface at any time.

XRP Price Action

At the time of writing, XRP was down 1.30% to $0.40257. A mixed start to the day saw XRP rise to an early high of $0.40916 before falling to a low of $0.40000.

XRP on the back foot.
XRPUSD 011222 Daily Chart

Technical Indicators

XRP needs to move through the $0.4041 pivot to target the First Major Resistance Level (R1) at $0.4153. A move through the Wednesday high of $0.41147 would signal a breakout session.

In the case of an extended rally, the bulls would take a run at the Second Major Resistance Level (R2) at $0.4227 and $0.43. The Third Major Resistance Level (R3) sits at $0.4413.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.3967 in play. Barring an extended sell-off, XRP should avoid sub-$0.3900 and the Second Major Support Level (S2) at $0.3855. The Third Major Support Level (S3) sits at $0.3669.

XRP movement will likely hinge on updates from the SEC v Ripple case and today’s US economic indicators.

XRP support levels in play below the pivot.
XRPUSD 011222 Hourly Chart

The EMAs and the 4-hourly candlestick chart (below) sent a more bullish signal.

At the time of writing, XRP sat below the 200-day EMA, currently at $0.40432. The 50-day EMA crossed through the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA. The signals were bullish.

A breakout from the 200-day EMA would support a move through R1 ($0.4153) to target R2 ($0.4227) and $0.43. However, a fall through S1 ($0.3967) would bring the 50-day ($0.39300) and the 100-day ($0.39276) EMAs into view.

EMAs turning bullish.
XRPUSD 011222 4 Hourly Chart

DOGE and SHIB Face Early Pressure as Focus Shifts to US Inflation

Key Insights:

  • Dogecoin (DOGE) and shiba inu coin (SHIB) enjoyed a bullish Wednesday session, with DOGE testing resistance at $0.11.
  • Bets of China easing lockdown measures and Fed Chair Powell delivered a NASDAQ breakout session, which provided DOGE and SHIB price support.
  • The technical indicators remain mixed, with the DOGE EMAs signaling further price gains.

On Wednesday, dogecoin (DOGE) rose by 5.13%. Following a 6.74% rally on Tuesday, DOGE ended the day at $0.1066. Notably, DOGE wrapped up the day at $0.10 for the second time since November 7.

A bullish start to the day saw DOGE rally to an early high of $0.1099. DOGE broke through the First Major Resistance Level (R1) at $0.1066 before sliding to a late afternoon low of $0.0995. However, steering clear of the First Major Support Level (S1) at $0.0949, DOGE broke back through R1 to revisit $0.1096 before easing back.

Shiba inu coin (SHIB) rose by 2.97% on Wednesday. After ending the Tuesday session flat, SHIB ended the day at $0.00000935.

Tracking DOGE, SHIB rose to an early high of $0.00000939. SHIB broke through the First Major Resistance Level (R1) at $0.00000926 before sliding back to a late afternoon low of $0.00000902. However, steering clear of the First Major Support Level (S1) at $0.00000894, SHIB broke back through R1 to revisit the day high of $0.00000939 before easing back.

Bullish sentiment spilled over from Tuesday to deliver a breakout start to the mid-week session. Hopes of the Chinese government easing lockdown measures in the wake of the countrywide protests drove crypto demand. Softer FTX contagion risk and hopes of a December Fed pivot also gave support.

Late in the day, a less hawkish Fed Chair Powell supported a second wave of buying to deliver solid gains for the session. Fed Chair Powell talked of slowing the pace of interest rate hikes, affirming market bets of a Fed pivot.

The less hawkish comments delivered a bullish session for the US equity markets, with the NASDAQ Composite Index and S&P500 seeing gains of 4.41% and 3.09%, respectively.

However, there were no updates on Twitter’s DOGE integration plans to support a return to $0.11.

Following the market reaction to Fed Chair Powell’s comments on Wednesday, US economic indicators will likely influence today. Inflation and personal spending figures will draw interest along with FOMC member chatter.

A spike in inflation and spending, together with hawkish FOMC member chatter, would test buyer demand. Investors will also need to track the news wires for Twitter updates on its crypto integration plans.

Dogecoin (DOGE) Price Action

At the time of writing, DOGE was down 1.69% to $0.1048. A mixed start to the day saw DOGE rise to an early high of $0.1079 before falling to a low of $0.1038.

DOGE under pressure.
DOGEUSD 011222 Daily Chart

Technical Indicators

DOGE needs to move through the $0.1053 pivot to target the First Major Resistance Level (R1) at $0.1112. A move through the Wednesday high of $0.1099 would signal a bullish afternoon session. However, the news wires need to be crypto-friendly to support a breakout session.

In the event of an extended afternoon breakout session, the bulls could take a run at the Second Major Resistance Level (R2) at $0.1157 and $0.12. The Third Major Resistance Level (R3) sits at $0.1261.

Failure to move through the pivot ($0.1053) would leave the First Major Support Level (S1) at $0.1008 in play. Barring an extended sell-off, DOGE should avoid sub-$0.10 and the Second Major Support Level (S2) at $0.0949.

The Third Major Support Level (S3) sits at $0.0845.

DOGE support levels in play.
DOGEUSD 011222 Hourly Chart

The EMAs sent a bullish signal, with DOGE sitting above the 50-day EMA, currently at $0.0931. The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA. The price signals were bullish.

A hold above S1 ($0.1008) and the 50-day EMA ($0.0953) would support a breakout from R1 ($0.1112) to target R2 ($0.1157) and $0.12. However, a fall through S1 ($0.1008) would give the bears a run at the 50-day EMA ($0.0953) and S2 ($0.0949).

EMAs bullish.
DOGEUSD 011222 4 Hourly Chart

Shiba Inu Coin (SHIB) Price Action

At the time of writing, SHIB was down 1.39% to $0.00000922. A bearish start to the day saw SHIB fall from an early high of $0.00000937 to a low of $0.00000920.

SHIB on the back foot.
SHIBUSD 011222 Daily Chart

Technical Indicators

SHIB needs to move through the $0.00000925 pivot to target the First Major Resistance Level (R1) at $0.00000949. A return to $0.00000940 would signal a bullish afternoon session. However, SHIB will likely take its cues from the broader crypto market and the NASDAQ Index.

In the case of an extended rally, SHIB would likely test the Second Major Resistance Level (R2) at $0.00000962. The Third Major Resistance Level (R3) sits at $0.00000999.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.00000912 in play. Barring an extended sell-off, SHIB should avoid sub-$0.00000890 and the Second Major Support Level (S2) at $0.00000888. The Third Major Support Level (S3) sits at $0.00000851.

SHIB support levels in play.
SHIBUSD 011222 Hourly Chart

The EMAs send a bearish signal, with SHIB sitting below the 100-day EMA, currently at $0.00000929. This morning, the 50-day EMA narrowed on the 100-day EMA, while the 100-day EMA flattened on the 200-day EMA. The signals were mixed.

A SHIB move through the 100-day EMA ($0.00000929) would support a run at R1 ($0.000000949) and $0.000000950. However, a fall through the 50-day EMA ($0.00000914) and S1 ($0.00000912) would bring S2 ($0.00000888) into view.

EMAs bearish,
SHIBUSD 011222 4 Hourly Chart

BTC Fear & Greed Index Slips Despite the Powell-Fueled NASDAQ Rally

Key Insights:

  • On Wednesday, bitcoin (BTC) rallied 4.42% to end the day at $17,180.
  • Risk-on sentiment fueled by bets of China easing lockdown measures and a less hawkish Fed Chair delivered a NASDAQ and BTC breakout.
  • However, the Fear & Greed Index slipped from 29/100 to 27/100, reflecting caution ahead of today’s US economic indicators.

On Wednesday, bitcoin (BTC) rallied 4.42%. Following a 1.48% gain on Tuesday, BTC ended the day at $17,180. Notably, BTC wrapped up the day at $17,000 for the first time since early November.

A mixed start to the day saw BTC fall to an early low of $16,446. Steering clear of the First Major Support Level (S1) at $16,187, BTC surged to a late high of $17,275. BTC broke through the First Major Resistance Level (R1) at $16,631 and the Second Major Resistance Level (R2) at $16,810. The Third Major Resistance Level (R3) at $17,254 capped the upside.

Risk on sentiment from Tuesday spilled over to the Wednesday session. The investor bets of the Chinese government easing lockdown measures delivered early support, with falling FTX contagion risk also market positive.

However, late in the session, Fed Chair Powell delivered the session high, with the Fed Chair talking of a Fed pivot as soon as this month.

The less hawkish chatter also delivered a bullish session for the US equity markets. The NASDAQ Composite Index and the S&P 500 rallied by 4.41% and 3.09%, respectively.

Later today, US economic indicators and FOMC member chatter will likely provide further direction, with inflation and personal spending figures in focus.

A spike in inflation and spending and hawkish Fed chatter would test buyer appetite.

This morning, the NASDAQ mini was up 23.25 points, while BTC and the broader crypto market had a mixed start.

NASDAQ correlation.
NASDAQ – BTCUSD 011222 5 Minute Chart

The Fear & Greed Index Slips to 27/100 Despite NASDAQ Composite Rally

Today, the BTC Fear & Greed Index fell from 29/100 to 27/100. A bullish crypto session failed to nudge the Index closer to the Neutral zone.

Investor apprehension ahead of today’s US inflation figures and FOMC member chatter likely contributed to the modest fall. However, the Index avoided a return to the Extreme Fear zone. An increase to 30/100 would be an early signal of a BTC run at $20,000.

Avoiding sub-20/100 remains the key near-term. The bulls will need to target the pre-FTX collapse high of 40/100 (Nov 6) to support the BTC run at $20,000.

Fear & Greed Index avoids the Extreme Fear zone.
Fear & Greed 011222

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.05% to $17,189. A mixed start to the day saw BTC fall to an early low of $17,157 before rising to a high of $17,271.

BTC finds early support.
BTCUSD 011222 Daily Chart

Technical Indicators

BTC needs to avoid the $16,967 pivot to target the First Major Resistance Level (R1) at $17,488. A move through the Wednesday high of $17,275 would signal an extended breakout session. However, BTC would need US stats, FOMC member commentary, and friendly FTX-linked news updates to support a run at $18,000.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $17,796 and resistance at $18,000 before any pullback.

The Third Major Resistance Level (R3) sits at $18,625.

A fall through the pivot would bring the First Major Support Level (S1) at $16,659 into play. Barring an extended sell-off, BTC should avoid sub-$16,500 and the Second Major Support Level (S2) at $16,138. The Third Major Support Level (S3) sits at $15,309.

BTC resistance levels in play.
BTCUSD 011222 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, bitcoin sat above the 100-day EMA, currently at $16,824. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R1 ($17,488) and the 200-day EMA ($17,519) would support a breakout from R2 ($17,796) to target $18,000. However, a fall through the 100-day EMA ($16,824) would bring S1 ($16,659) and the 50-day EMA ($16,594) into view.

EMAs turning bullish.
BTCUSD 011222 4 Hourly Chart

Crypto Market Daily Highlights – Powell and the NASDAQ Fuel a Breakout

Key Insights:

  • It was a bullish Wednesday session for the crypto top ten. MATIC led the way, with ETH revisiting $1,300.
  • Investor sentiment toward China’s zero-COVID policy, FTX contagion risk, and market reaction to Fed Chair Powell’s speech supported a breakout session.
  • The crypto market cap jumped by $31.4 billion to end the day at $820.9 billion.

It was a bullish Wednesday session for the crypto top ten. MATIC led the way, with DOGE and ETH also making bullish moves. BTC wrapped up the day at $17,000 for the first time in nineteen sessions.

Investor sentiment towards China’s zero-COVID policy and easing FTX contagion risk delivered early support.

However, Fed Chair Powell delivered a late rally. Following mixed US labor market numbers, the Fed Chair supported the market bets of a December Fed pivot. On Wednesday, the Fed Chair talked of moderating the pace of interest rate increases, reportedly saying,

“It makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down. The time for moderating the pace of rate increases may come as soon as the December meeting.”

During the speech, investor reaction was evident, with the crypto market cap jumping by $16.5 billion. US economic indicators had delivered mixed reactions ahead of Powell’s speech.

The NASDAQ Composite Index also responded to the Powell speech, rallying 4.41% to end November on a high.

Later today, US inflation and personal spending figures will provide further direction along with FOMC member chatter. A spike in inflation and spending and hawkish Fed chatter would test buyer appetite.

NASDAQ correlation.
Total Market Cap – NASDAQ – 011222 5 Minute Chart

Crypto Market Returns to $800bn on China COVID Policy and Powell

On Wednesday, the crypto market cap rose from an early low of $787.2 billion to a late high of $827.6 billion. While hopes of China easing lockdown measures supported a bullish start to the day, Fed Chair Powell delivered the session high.

The $31.4 billion surge on Wednesday left the market cap down $151.1 billion to $820.9 billion for November.

Crypto market sees heavy November loss.
Total Market Cap 011222 Daily Chart

The Crypto Market Movers and Shakers from the Top Ten and Beyond

It was a bullish Wednesday session for the crypto top ten.

MATIC led the way, surging by 11.41%, with DOGE and ETH seeing gains of 5.13% and 6.49%, respectively.

However, ADA (+3.24%), BNB (+1.79%), BTC (+4.42%), and XRP (+2.43%) trailed the front runners.

From the CoinMarketCap top 100, it was a bullish session.

GMX (GMX) led the way, surging by 18.24%, with fantom (FTM) and polygon (MATIC) seeing gains of 12.52% and 11.41%, respectively.

However, huobi token (HT) led the way down, falling by 2.23%, with celo (CELO) ending the day with a 0.49% loss.

24-Hour Liquidations Inch Higher in a Powell-Fueled Breakout

Over 24 hours, total liquidations climbed as investors raised bets of China easing lockdown measures and reacted to Fed Chair Powell’s speech.

At the time of writing, 24-hour liquidations stood at $86.43 million, up from $73.29 million on Wednesday morning.

Liquidated traders over the last 24 hours also increased. At the time of writing, liquidated traders stood at 25,085 versus 19,696 on Wednesday morning. However, liquidations were down over 12 and four hours and over one hour.

Crypto liquidations rise over 24-hours.
Total Crypto Liquidations 011222

According to Coinglass, 12-hour liquidations fell from $49.01 million to $32,75 million, with four-hour liquidations down from $37.42 million to $8.52 million. One-hour liquidations slid from $36.06 million to $2.13 million.

The chart below shows market conditions throughout the session.

Crypto market enjoyed a late breakout.
Total Market Cap 011222 Hourly Chart

Wall Street ends sharply higher after Powell comments

By Noel Randewich and Shreyashi Sanyal

(Reuters) – Wall Street ended sharply higher on Wednesday after Federal Reserve Chair Jerome Powell said the central bank might scale back the pace of its interest rate hikes as soon as December.

The S&P 500 rallied and closed above its 200 day moving average for the first time since April after the release of Powell’s remarks prepared for delivery at the Brookings Institution think tank in Washington.

S&P 500 clears 200-day moving average https://fingfx.thomsonreuters.com/gfx/ce/lbvggndelvq/Pasted%20image%201669847267277.png

Powell also cautioned that the fight against inflation was far from over and that key questions remain unanswered, including how high rates will ultimately need to rise and for how long.

“(The market) has waited with bated breath, looking for that clarification in terms of duration and extent of Fed tightening. And anything that gives hope to the idea the Fed is becoming less hawkish is viewed as a positive for stocks, at least on a short-term basis,” said Chuck Carlson, Chief Executive Officer at Horizon Investment Services in Hammond, Indiana.

Bets that the Fed will reduce the size of its rate hikes, as well as recent data pointing to a mild cooling in inflation, led the benchmark S&P 500 index to its second straight month of gains.

The CME FedWatch Tool showed futures traders seeing a 75% chance that the Fed will raise interest rates by 50 basis points at its December meeting, up from a 65% chance before Powell’s comments were released. The FedWatch tool now shows a 25% chance of a 75 basis point increase.

Nvidia rallied more than 8%, Microsoft jumped 6.2% and Apple climbed 4.9%.

Tesla Inc’s shares surged 7.7% after China Merchants Bank International said Tesla’s sales in China in November were boosted by price cuts and incentives offered on its Model 3 and Model Y.

The S&P 500 climbed 3.09% to end the session at 4,079.97 points.

The Nasdaq gained 4.41% to 11,468.00 points, while Dow Jones Industrial Average rose 2.18% to 34,589.24 points.

The Philadelphia Semiconductor index surged 5.85%, trimming its loss in 2022 to about 28%.

Volume on U.S. exchanges was heavy, with 15.0 billion shares traded, compared to an average of 11.1 billion shares over the previous 20 sessions.

For November, the S&P 500 climbed 5.4%, the Dow added 5.7% and the Nasdaq increased 4.4%.

An ADP National Employment report showed private employment increased by 127,000 in November, below expectations of 200,000 jobs, suggesting demand for labor was cooling amid high interest rates.

“The ADP employment number not meeting expectations fits into the narrative that the Fed will have room and start slowing down its rate hikes, and that definitely benefits interest rate sensitive assets,” said Keith Buchanan, a portfolio manager at Globalt in Atlanta.

The Labor Department’s closely watched nonfarm payrolls data is due on Friday. A report showed U.S. job openings falling to 10.334 million in October, against 10.687 million in the prior month.

Another reading showed the U.S. economy rebounded more strongly than initially thought in the third quarter.

S&P 500 stocks https://fingfx.thomsonreuters.com/gfx/mkt/lgvdkwezjpo/SPX_by_marketcap.png

The S&P 500 remains down about 14% so far in 2022, while the Nasdaq index has lost about 27%.

Biogen Inc jumped 4.7% after its experimental Alzheimer’s drug slowed cognitive decline in a closely watched trial.

Advancing issues outnumbered falling ones within the S&P 500 by a 24.1-to-one ratio.

The S&P 500 posted 24 new highs and 1 new low; the Nasdaq recorded 117 new highs and 167 new lows.

(Reporting by Shreyashi Sanyal, Devik Jain & Bansari Mayur Kamdar in Bengaluru, and by Noel Randewich in Oakland, Calif.; additional reporting by Stephen Culp in New York; Editing by Shounak Dasgupta, Chizu Nomiyama and Diane Craft)

S&P 500 Gains Ground After Powell’s Comments On Inflation And The Labor Market

Key Insights

  • S&P 500 gained strong upside momentum after the release of Fed Chair Powell remarks. 
  • The market focused on the potential slowdown of the pace of Fed rate hikes. 
  • A move above 4000 will push S&P 500 towards the resistance at 4015.

Powell’s Remarks Provided Support To Stocks

S&P 500 moved higher after the speech from Fed Chair Powell as his remarks contained no surprises.

Powell noted: “The time for moderating the pace of rate increases may come as soon as the December meeting […] It is likely that restoring price stability will require holding policy at a restrictive level for some time.”

In general, Powell said the same things as Fed speakers in their recent public statements. The Fed will have to raise interest rates to a restrictive level and then hold them at this level for some time to make sure that inflation is under control.

Markets are focused on the potential slowdown of the pace of rate hikes. It looks that traders hope that inflation will start moving lower at a robust pace, and the peak rate would not be too high.

Treasury yields moved lower after Powell’s remarks, which was bullish for tech stocks. NASDAQ Composite gained strong upside momentum and made an attempt to settle above the 11,150 level. Tesla, Meta, NVIDIA, Alphabet, and Microsoft were up by more than 2% in today’s trading session.

S&P 500 Is Moving Towards The 4000 Level

S&P 500

S&P 500 moved above the 3960 level after Powell’s remarks. RSI is in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge. The next resistance level for S&P 500 is located at 4000. A move above this level will push S&P 500 towards the 4015 level. If S&P 500 gets above 4015, it will head towards the resistance at 4040.

On the support side, the previous resistance at 3960 will serve as the first support level for S&P 500. If S&P 500 gets back below 3960, it will head towards the support at 3920. A successful test of this level will push S&P 500 towards the next support near the 50 EMA at 3885.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500, NASDAQ Composite Posting Small Gains Ahead of Fed Chair Powell’s Speech

The U.S. stock market is expected to open mixed on Wednesday with the Dow and S&P 500 Index showing losses, while the NASDAQ is bucking the early trend with a slight gain.

The volatile pre-market trade is being fueled by conflicting economic reports. Low volume is also behind the choppy trade with many of the major players trading lightly ahead of a key speech by Federal Reserve Chairman Jerome at 18:30 GMT.

At 14:16 GMT, the blue chip Dow Jones Industrial Average is trading 33855.00, down 2.00 or -0.01%. The benchmark S&P 500 Index is at 3963.75, up 1.75 or +0.04% and the tech-heavy NASDAQ is trading 11541.25, up 16.50 or 0.14%.

Mixed Economic Data Driving Volatile Trade

The major indexes erased earlier gains after economic reports on labor and growth delivered conflicting signals about the strength of the economy.

A report from ADP on the state of the labor market signaled that private sector hiring was cooling, raising hopes the Federal Reserve would slow it aggressive rate-hiking campaign. This news helped underpin prices following its release at 13:15 GMT.

The early session strength didn’t last very long because 15 minutes later at 13:30 GMT, an estimate of U.S. GDP came in stronger than expected, suggesting the Fed still has wiggle room for another aggressive rate hike. Stocks turned lower on the news.

Specifically, the ADP Non-Farm Employment Change report showed that private companies added just 127,000 positions for the month, well below the 190,000 consensus estimate from economists polled by Dow Jones.

The second estimate of third quarter GDP, released by the Bureau of Economic Analysis showed an increase of 2.9% annually. That was revised higher from the 2.6% first estimate.

Daily S&P 500 Index

Short-Term Outlook

Other reports on Wednesday showed an increase in the trade deficit to 99.0 billion. Preliminary Wholesale Inventories rose 0.8%, worse than the 0.5% estimate.

The Preliminary GDP Price Index rose 4.3%, higher than the 4.1% estimate and previous reading. This confirmed that inflation is still stubbornly high.

The next major report will be released at 15:00 GMT. The JOLTS Job Openings report is expected to dip from 10.72 million to 10.24 million. This news would be perceived as favorable for the stock market.

All Eyes on Fed Chair Powell

However, we’re not expecting much movement in prices ahead of Federal Reserve Chair Jerome Powell’s speech at 18:30 GMT.

Powell is expected to deliver remarks on the economy and the labor market. I expect him to highlight that inflation is still too high and the labor market too strong, and that more has to be done to bring both down. This would be perceived as hawkish and perhaps bearish for stocks into the close.

But the direction of the market will most likely be determined by the tone of Powell’s speech. Investors will be listening to hear if he reiterates the tone of previous speeches where he called for rates to go up until inflation returns to the 2% level and the unemployment rate moves closer to 5%.

Instead of telling investors that rates will be moving higher, Powell could mention conditions for a pivot from higher rates. This would be perceived as bullish for stocks.

Essentially, Powell is likely to remain hawkish, but to which degree according to trader perceptions, will drive stock indexes sharply higher or sharply lower into the close.

Furthermore, investors aren’t likely to start a new uptrend with the market facing fresh Non-Farm Payrolls data on Friday and consumer inflation data next week.

For a look at all of today’s economic events, check out our economic calendar.

ADP Reports Private Sector Hiring Increased by Just 127,000 Jobs in November

The ADP Non-Farm Employment Change report showed on Wednesday that private sector employment rose by 127,000 in November. This reading came in lower than the market expectation of 190,000. The October reading was unchanged at 239,000.

In response to the data, Nela Richardson, chief economist at ADP said, “Turning points can be hard to capture in the labor market, but our data suggest that Federal Reserve tightening is having an impact on job creation and pay gains.”

“In addition, companies are no longer in hyper-replacement mode. Fewer people are quitting and the post-pandemic recovery is stabilizing,” Richardson said.

Instant Analysis

The data supports the notion that the series of aggressive rate hike by the Federal Reserve are working to slow inflation and the labor market, leading investors to price in a 50 basis point rate hike by the Federal Reserve on December 15. This move would bring an end to the Fed’s streak of 75 basis point rate hikes.

Traders will now get the opportunity to react to another labor market report at 15:00 GMT. The JOLTS report is expected to show the number of job openings dropped from 10.72 million to 10.24 million.

At 18:30 GMT, Fed Chairman Jerome Powell is expected to give a speech on the economy and labor markets. Investors are hoping for further insight on the pace of future interest rate hikes and whether policymakers have a pivot strategy. Powell might also discuss the probability of a recession.

Market Reaction

U.S. Treasury yields dipped on the news, driving the U.S. Dollar lower. U.S. stock traders liked the news, adding to earlier gains in the pre-market session.

For a look at all of today’s economic events, check out our economic calendar.

Stock Futures Rise as Investors Await ADP Jobs Market Data

The major U.S. stock index futures are edging higher on Wednesday as investors await the release of key labor market and growth reports. However, the major event will be an afternoon speech from Federal Reserve Chair Jerome Powell that is expected to give further insight into future rate hikes.

At 11:38 GMT, Dow Jones Industrial Average futures are trading 33868.00, up 11.00 or -0.03%. The S&P 500 Index futures contract is at 3967.25, up 5.25 or +0.13% and the Nasdaq Composite Index is trading 11554.50, up 29.75 or +0.26%.

Daily S&P 500 Index

Investors Bracing for ADP Private Payrolls Report

Investors are hoping today’s ADP Non-Farm Employment Change report gives them some insight into the state of the U.S. labor market in advance of Friday’s big payrolls report.

The ADP jobs reading is due Wednesday at 13:15 GMT. Economists polled by Dow Jones anticipate that private employers grew their payrolls by 190,000 positions in November, a decline from October’s increase of 239,000.

Powell Could Provide Hints about Magnitude of Future Interest Rate Hikes

Federal Reserve Chairman Jerome Powell is due to speak at a Brookings Institution event at 18:30 GMT about the outlook for the U.S. economy and the labor market. Investors will be looking for clues about when the Fed will slow the pace of its aggressive interest rate hikes.

Futures market traders are expecting the Fed to deliver a smaller 0.50 percentage point rate hike on December 14 after four consecutive 0.75 percentage point increases to tame high inflation.

Yield Curve Spread May Be Signally Recession Ahead

A key part of the yield curve closely watch by Wall Street investors and analysts alike inverted further on Tuesday, potentially signaling a recession ahead. The yield curve inversion between the 2-year and 10-year Treasurys widened yesterday.

What this inversion signals is that the Fed may have tamed inflation enough to cool down the economy and may be able to pause or pivot soon. It can be read as a sign that a recession is on the horizon.

Stocks Attracting Attention in the Premarket Session

A pair of stocks are trading weaker during the premarket session after releasing earnings results that missed Wall Street’s expectations.

Shares of Crowdstrike Holdings plunged more than 18% after giving light guidance for fourth-quarter revenue, even though its earnings results topped Wall Street estimates.

NetApp stock fell 10.8% after the cloud services and data management provider saw weaker-than-expected revenue in its latest quarter.

Short-Term Outlook

Traders are likely to react positively ahead of the cash market opening if the ADP jobs report shows fewer than expected jobs were created in the private sector in November. Ahead of the report, traders are looking for a reading of 190K.

A lower-than-expected reading will take the pressure off the Fed to raise rates aggressively, thereby solidifying the chances of a 50 basis point rate hike in December.

Early gains could be limited, however, because of the uncertainty ahead of Fed Chair Powell’s speech at 18:30 GMT.

For a look at all of today’s economic events, check out our economic calendar.

ADA Price Prediction: Bulls Eye $0.325 on Hopes of a December Fed Pivot

Key Insights:

  • On Tuesday, ADA rose by 0.98% to end the day at $0.309. While ADA ended a two-day losing streak, ADA trailed the top ten cryptos.
  • A shift in sentiment towards China’s zero-COVID policy led to decoupling from the NASDAQ Composite Index.
  • The technical indicators remain bearish, with ADA sitting at the 50-day EMA, to leave sub-$0.300 in view.

On Tuesday, ADA rose by 0.98%. Partially reversing a 2.24% loss from Monday, ADA ended the day at $0.309.

A mixed start to the day saw ADA fall to an early morning low of $0.304. Steering clear of the First Major Support Level (S1) at $0.299, ADA rose to a late morning high of $0.312. However, coming up short of the First Major Resistance Level (R1) at $0.313, ADA fell back to $0.306 before ending the day in positive territory.

China and Fed Chair Powell Are Market Focal Points Mid-Week

On Tuesday, the investors experienced a reversal of fortunes. Hopes of the Chinese government easing COVID lockdown measures drove demand for riskier assets. The upside came despite no government hints of a shift in policy.

ADA and the broader market avoided tracking the NASDAQ Composite into negative territory. Market apprehension towards Fed Chair Powell’s speech later today left the NASDAQ in the red.

This morning, weak economic indicators from China and reports of more protests in China failed to spook investors.

Later today, Fed Chair Powell could give investors policy guidance. Powell will speak about the economy and the labor market late in the US session. Ahead of the Powell speech, GDP, ADP nonfarm employment change, and JOLTs job openings will draw interest. However, we expect the labor market numbers to have more influence on riskier assets.

There were no updates from Input Output HK (IOHK) or founder Charles Hoskinson to influence, leaving ADA in the hands of Powell and the NASDAQ Composite Index today. The NASDAQ mini was up 22.75 points this morning.

ADA Price Action

This morning, ADA was up 1.94% to $0.315. A bullish morning saw ADA rise from an early low of $0.308 to a high of $0.319.

ADA broke through the First Major Resistance Level (R1) at $0.313 and briefly through the Second Major Resistance Level (R2) at $0.316.

ADA on the move.
ADAUSD 301122 Daily Chart

Technical Indicators

ADA needs to avoid falling through R1 and the $0.308 pivot to retarget the Second Major Resistance Level (R2) at $0.316 and the morning high of $0.319. A return to $0.319 would support a bullish afternoon session.

In case of an extended rally, the Third Major Resistance Level (R3) at $0.324 and $0.325 would come into play.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $0.305 into play. However, barring a risk-off-fueled sell-off, ADA should avoid sub-$0.300. The Second Major Support Level (S2) at $0.300 should limit the downside.

Hawkish Fed chair Powell chatter could reverse bets of a Fed pivot that would bring sub-$0.300 into view.

The Third Major Support Level (S3) sits at $0.292.

ADA resistance levels in play.
ADAUSD 301122 Hourly Chart

This morning, the EMAs and the 4-hourly candlestick chart (below) sent a bearish signal.

ADA sat at the 50-day EMA, currently at $0.314. The 50-day EMA narrowed to the 100-day EMA, while the 100-day EMA fell back from the 200-day EMA, delivering mixed signals.

An ADA breakout from the 50-day EMA ($0.314) would support a move through R2 ($0.316) to bring R3 ($0.324) into play. However, a slide through the 50-day EMA and R1 ($0.313) would support a fall through S1 ($0.305) to bring S2 ($0.300) into view.

EMAs remain bearish.
ADAUSD 301122 4-Hourly Chart

ETH Targets $1,300 on BTC Return to $17,000 Ahead of Powell’s Speech

Key Insights:

  • Bitcoin (BTC) and ethereum (ETH) joined the broader crypto market in a bullish crypto session on Tuesday.
  • A shift in sentiment towards the Chinese government’s lockdown plans and hopes of a December Fed pivot delivered price support.
  • This morning, bullish sentiment continued to drive demand for riskier assets, with Fed Chair Powell in the spotlight.

Ethereum (ETH) rallied by 4.20% on Tuesday. Reversing a 2.18% loss from Monday, ETH ended the day at $1,216. ETH wrapped up the day at $1,200 for the first time in three sessions.

A mixed start to the day saw ETH fall to an early low of $1,157. Steering clear of the First Major Support Level (S1) at $1,145, ETH rallied to a late high of $1,227. ETH broke through the First Major Resistance Level (R1) at $1,194 and briefly through the Second Major Resistance Level (R2) at $1,221 before ending the day at $1,216.

On Tuesday, bitcoin (BTC) rose by 1.48%. Reversing a 1.36% loss from Monday, BTC ended the day at $16,452. Notably, BTC avoided sub-$16,000 for the seventh consecutive day while ending a five-day losing streak.

A mixed start to the day saw BTC fall to an early low of $16,101. Steering clear of the First Major Support Level (S1) at $15,980, BTC rose to a mid-morning high of $16,545. BTC broke through the First Major Resistance Level (R1) at $16,465 before a pullback to sub-$16,400. However, a bullish end to the session saw BTC retest R1 before easing back.

Hopes of China easing lockdown measures supported a bullish Tuesday session, with the Hang Seng Index and CSI300 reversing Monday’s losses. Easing FTX contagion fears was also market positive, with investors brushing aside the news of BlockFi filing for bankruptcy.

Later today, the US economic calendar will continue to draw interest, with ADP nonfarm employment change, Q3 GDP, and JOLTs job openings in the spotlight. The labor market numbers will likely have more influence ahead of Fed Chair Powell’s speech.

Fed Chair Powell could have the final say, with talk of another 75-basis point rate hike likely to weigh on BTC and the broader market. Talk of a Fed pivot would support further upside, however.

The NASDAQ mini was up 10.50 points this morning, while BTC and ETH were in breakout mode.

Ethereum (ETH) Price Action

At the time of writing, ETH was up 4.31% to $1,268. A bullish start to the day saw ETH rally from an early low of $1,212 to a high of $1,282.

ETH broke through the First Major Resistance Level (R1) at $1,243 and briefly through the Second Major Resistance Level (R2) at $1,270.

ETH targets $1,300.
ETHUSD 301122 Daily Chart

Technical Indicators

ETH has to avoid a fall through R1 and the $1,1200 pivot to retarget the Second Major Resistance Level (R2) at $1,270 and $1,300. An ETH return to $1,280 would signal a bullish afternoon session. However, the crypto news wires need to provide support.

In the event of an extended rally, ETH would likely test the Third Major Resistance Level (R2) at $1,340.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $1,173 into play. However, barring an extended afternoon sell-off, ETH should avoid sub-$1,170 and the Second Major Support Level (S2) at $1,130.

The Third Major Support Level (S3) sits at $1,060.

ETH resistance levels in play.
ETHUSD 301122 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. Ethereum sat below the 200-day EMA, currently at $1,277. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R2 ($1,270) and the 200-day EMA ($1,277) would support a run at $1,300 and R3 ($1,340). However, a fall through R1 ($1,243) would bring the 100-day ($1,223) and the 50-day ($1,200) EMAs and S1 ($1,173) into play.

EMAs turning bullish.
ETHUSD 301122 4 Hourly Chart

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 2.64% to $16,886. A mixed start to the day saw BTC fall to an early low of $16,446 before rising to a high of $17,109.

BTC broke through the First Major Resistance Level (R1) at $16,631 and the Second Major Resistance Level (R2) at $16,810.

BTC returns to $17,000.
BTCUSD 301122 Daily Chart

Technical Indicators

BTC needs to avoid a fall through R2, R1, and the $16,366 pivot to target the Third Major Resistance Level (R3) at $17,254. A hold onto $17,000 would signal an extended breakout session. However, BTC would need US stats, Fed Chair Powell, and friendly FTX-linked news updates to support a breakout from the morning high of $17,109.

In the event of an extended rally, BTC would likely test resistance at $18,000 before any pullback.

A fall through the Major Resistance Levels and the pivot would bring the First Major Support Level (S1) at $16,187 into play. Barring an extended sell-off, BTC should avoid sub-$16,000 and the Second Major Support Level (S2) at $15,922. The Third Major Support Level (S3) sits at $15,478.

BTC resistance levels in play.
BTCUSD 301122 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. BTC sat above the 100-day EMA, currently at $16,800 this morning. The 50-day EMA narrowed to the 100-day EMA, with the 100-day EMA flattening on the 200-day EMA, delivering bullish signals.

A hold above the 100-day EMA ($16,800) and R2 ($16,810) would support a run at R3 ($17,254) and the 200-day EMA ($17,550). However, a fallback through R2 ($16,810) and the 100-day EMA (16,799) would bring R1 ($16,631) and the 50-day EMA ($16,477) into view.

EMAs turning bullish.
BTCUSD 301122 4 Hourly Chart

BTC Fear & Greed Index Climbs Higher Despite a Bearish NASDAQ Session

Key Insights:

  • On Tuesday, bitcoin (BTC) rose by 1.48% to end the day at $16,452.
  • Risk aversion stemming from protests in China eased, supporting BTC and the broader crypto market.
  • However, the Fear & Greed Index rose from 26/100 to 29/100, reflecting bullish investor sentiment and further signs of a bottoming out.

On Tuesday, bitcoin (BTC) rose by 1.48%. Reversing a 1.36% loss from Monday, BTC ended the day at $16,452. Notably, BTC avoided sub-$16,000 for the seventh consecutive day while ending a five-day losing streak.

A mixed start to the day saw BTC fall to an early low of $16,101. Steering clear of the First Major Support Level (S1) at $15,980, BTC rose to a mid-morning high of $16,545. BTC broke through the First Major Resistance Level (R1) at $16,465 before a pullback to sub-$16,400. However, a bullish end to the session saw BTC retest R1 before easing back.

Investor jitters over China’s zero-COVID policy eased, delivering BTC price support. On Tuesday, the Hang Seng Index rallied by 5.24%, with the CSI300 gaining 3.09% as investors bet on China easing lockdown measures.

US economic indicators were also crypto-friendly as FTX contagion risk eased further. In November, the CB Consumer Confidence Index fell from 102.2 to 100.2, supporting the bets of a December Fed pivot.

However, while investors brushed aside the news of BlockFi filing for bankruptcy, the NASDAQ Composite Index fell by 0.59%. Investor apprehension ahead of Fed Chair Powell’s speech left the Index in negative territory.

Later today, the US economic calendar will continue to draw interest, with ADP nonfarm employment change, Q3 GDP, and JOLTs job openings in the spotlight. The labor market numbers will likely have more influence ahead of Fed Chair Powell’s speech.

Fed Chair Powell could have the final say, with talk of another 75-basis point rate hike likely to weigh on BTC and the broader market.

This morning, the NASDAQ mini was up 8.50 points, while BTC and the broader crypto market were in breakout mode.

NASDAQ decouples ahead of Powell.
NASDAQ – BTCUSD 301122 5 Minute Chart

The Fear & Greed Index Nears 30/100 Despite NASDAQ Composite Fall

Today, the BTC Fear & Greed Index rose from 26/100 to 29/100. A bullish crypto session supported a continued upward trend, with the Index targeting the Neutral zone.

This week, the Fear & Greed Index has provided further signs of a possible bottoming out. Investors brushed aside the news of BlockFi filing for bankruptcy and rebounded sharply from the China protest-fueled sell-off on Monday.

Avoiding sub-20/100 remains the key near-term. The bulls will need to target the pre-FTX collapse high of 40/100 (Nov 6) to support a BTC run at $20,000.

Fear & Greed Index sends bullish signals.
Fear & Greed 301122

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 2.76% to $16,906. A bullish start to the day saw BTC rally from an early low of $16,446 to a high of $16,956.

BTC broke through the First Major Resistance Level (R1) at $16,631 and the Second Major Resistance Level (R2) at $16,810.

BTC on the move.
BTCUSD 301122 Daily Chart

Technical Indicators

BTC needs to avoid a fall through R1 and the $16,366 pivot to target the Third Major Resistance Level (R3) at $17,254. A return to $17,000 would signal an extended breakout session. However, BTC would need US stats, Fed Chair Powell, and friendly FTX-linked news updates to avoid a reversal.

In the event of an extended rally, BTC would likely test resistance at $18,000 before any pullback.

A fall through the Major Resistance Levels and the pivot would bring the First Major Support Level (S1) at $16,187 into play. Barring an extended sell-off, BTC should avoid sub-$16,000 and the Second Major Support Level (S2) at $15,922. The Third Major Support Level (S3) sits at $15,478.

BTC resistance levels in play.
BTCUSD 301122 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, bitcoin sat above the 100-day EMA, currently at $16,799. The 50-day EMA narrowed to the 100-day EMA, with the 100-day EMA flattening on the 200-day EMA, delivering bullish signals.

A return to $17,000 would bring R3 ($17,254) and the 200-day EMA ($17,550) into play. However, a fallback through R2 ($16,810) and the 100-day EMA (16,799) would bring R1 ($16,631) and the 50-day EMA ($16,477) into view.

EMAs turning bullish.
BTCUSD 301122 4 Hourly Chart

Crypto Market Daily Highlights – DOGE and ETH Lead the Top Ten

Key Insights:

  • It was a bullish Tuesday session for the crypto top ten. DOGE led the way, with ETH returning to $1,200.
  • Investor sentiment toward China eased, supporting a broad-based crypto rebound.
  • The crypto market cap rose by $13.3 billion to end the day at $789.4 billion.

It was a bullish Tuesday session for the crypto top ten. DOGE led the way, with ETH also making a move. Despite the bullish sentiment, BTC fell short of $17,000 for a thirteenth consecutive session while avoiding sub-$16,000 for a seventh successive session.

US economic indicators failed to curtail the Tuesday rebound despite consumer confidence deteriorating. In November, the CB Consumer Confidence Index fell from 102.2 to 100.2.

However, while the crypto market enjoyed a bullish session, the NASDAQ Composite Index ended the day with a 0.59% loss. Apprehension ahead of today’s Fed Chair Powell speech weighed.

Easing jitters over China’s zero-COVID policy, supported by the Hang Seng and the CSI300, delivered the Tuesday crypto rebound. Easing FTX contagion risk also contributed, however.

NASDAQ decoupling.
Total Market Cap – NASDAQ – 301122 Daily Chart

Crypto Market Bounces Back as China Risk Aversion Abated

On Tuesday, the crypto market cap slid to an early low of $770.2 billion before rising to a late morning high of $800.1 billion.

Bullish sentiment throughout the morning session supported the market recovery of Monday’s losses.

However, a mixed afternoon session saw the market cap fall back to $785 before finding support. A bullish end to the session left the market cap up by $13.3 billion to $789.4 billion on the day.

Crypto market on the move
Total Market Cap 301122 Daily Chart

The Crypto Market Movers and Shakers from the Top Ten and Beyond

It was a bullish Tuesday session for the crypto top ten.

DOGE led the way, rising by 6.74%, with ETH gaining 4.17%.

However, ADA (+0.98%), BNB (+0.65%), BTC (+1.48%), MATIC (+2.00%), and XRP (+2.36%) trailed the front runners.

From the CoinMarketCap top 100, it was a mixed session.

Huobi token (HT) led the way, rallying by 8.1%, with ETH and DOGE among the front runners.

However, binaryX (BNX) led the way down, falling by 2.92%, with kucoin token (KCS) and nexo (NEXO) seeing losses of 1.95% and 2.50%, respectively.

24-Hour Liquidations Eased on a Bullish Tuesday and Wednesday Morning

Over 24 hours, total liquidations slipped below normal levels. Sentiment towards China and FTX contagion delivered crypto market support, leading to the fall in liquidations.

At the time of writing, 24-hour liquidations stood at $73.29 million, down from $91.98 million on Tuesday morning.

Liquidated traders over the last 24 hours also decreased. At the time of writing, liquidated traders stood at 19,696 versus 34,626 on Tuesday morning. However, Liquidations were up over 12 and four hours and over one hour.

Crypto liquidations spike over the last hour.
Total Crypto Liquidations 301122

According to Coinglass, 12-hour liquidations rose from $30.63 million to $49.01 million, with four-hour liquidations up from $1.53 million to $37.42 million. One-hour liquidations jumped from $0.275 million $36.06 million.

The chart below shows market conditions throughout the session.

Crypto market spikes in first hour of the morning.
Total Market Cap 301122 Hourly Chart

S&P 500 ends down as Apple dips and traders eye Powell speech

By Shreyashi Sanyal and Noel Randewich

(Reuters) – The S&P 500 ended down on Tuesday, with losses in Apple and Amazon ahead of an upcoming speech by U.S. Federal Reserve Chair Jerome Powell that could provide hints about magnitude of future interest rate hikes.

Investors also focused on recent protests against COVID-19 curbs in China, including at the world’s biggest iPhone factory.

Apple’s stock dropped 2.1%, down for a fourth straight session.

Powell is due to speak at a Brookings Institution event on Wednesday about the outlook for the U.S. economy and the labor market. Investors will be looking for clues about when the Fed will slow the pace of its aggressive interest rate hikes.

“No one is willing to buy ahead of tomorrow with Powell speaking. Everyone is nervous about what he is going to say,” said Ron Saba, senior portfolio manager at Horizon Investments in Charlotte.

Shares of Amazon, Nvidia and Tesla each lost more than 1%.

The benchmark S&P 500 index is headed for its second straight month of gains in November amid bets that recent inflation readings showing a slight cooling in prices will lead the Fed to scale back the scale of its interest rate hikes.

The Fed has delivered four straight 75 basis point rate hikes, and it is expected to shift down the pace to a 50-bps move in December. [FEDWATCH]

A survey on Tuesday showed U.S. consumer confidence eased further in November amid persistent worries about the rising cost of living.

Mainland China’s recent wave of civil disobedience comes as the number of COVID cases hit record daily highs and large parts of several cities face new lockdowns, further threatening the world’s second largest economy.

The S&P 500 energy sector index rallied 1.3%, while gains in oil prices on expectations of a loosening of China’s strict COVID controls were later offset by concerns that OPEC+ would keep its output unchanged at its upcoming meeting.

The S&P 500 declined 0.16% to end the session at 3,957.60 points.

The Nasdaq declined 0.59% to 10,983.78 points, while Dow Jones Industrial Average rose 0.01% to 33,852.13 points.

Despite the S&P 500’s decline, advancing issues outnumbered falling ones by a 1.3-to-one ratio.

The S&P 500 posted three new highs and two new lows; the Nasdaq recorded 68 new highs and 183 new lows.

U.S.-listed shares of Chinese companies Alibaba Group Holding Ltd, Pinduoduo Inc and JD.com Inc jumped more than 5% after China broadened equity financing channels for property developers.

Shares of Chinese internet firm Bilibili Inc soared 22% after posting upbeat quarterly results.

Volume on U.S. exchanges was relatively light, with 9.6 billion shares traded, compared with an average of 11.2 billion shares over the previous 20 sessions.

(Reporting by Shreyashi Sanyal and Ankika Biswas in Bengaluru and by Noel Randewich in Oakland, Calif.; Editing by Marguerita Choy and Shounak Dasgupta)