🗞 Weekly Market Newsletter | Edition No. 37
❗️Important Announcement - Fox MetaCapital Community Call - April 4th 6:45pm PST - Invite Link Provided
Sunday, April 2nd, 2023
Hello Friends,
❗️Important Announcement❗️
We will be hosting our first Fox MetaCapital Community Call this Tuesday, April 4th at 6:45pm PST
🗓️ Event Details
Fox MetaCapital Community Call | Q1 Review + Discussion
Date & Time: Apr 4, 2023 6:45 PM - 8:00 PM PST
The Event Itinerary:
Minutes 0 - 10: Introductions & 👋🏽 Hello’s
Minutes 10 - 15: A Short Monologue, but Big Thank-You from the CEO
Minutes 10 - 30: Q1 Review, Major News Discussion + Market Overview
Minutes 30 - 45: Chart Requests and Technical Analysis 📈
Minutes 45 - 75+: Community Q&A + Open Discussion 💬
Meeting ID: 865 1659 4971
Passcode: XRP589
I’m looking forward to hosting our first community event and I truly wish to see each and every one of you attend should your schedules permit.
While this is an open community call, you may participate in our open discussions and our Q&A or simply enjoy the community event as an observer only*.
As we will discuss the most recent breaking news on our Tuesday call, this week’s edition will feature a brief outlook on the strength of the technicals across the board with my comments on what we can expect from the major indices heading into this week.
Sending the best of vibes and we’ll see you Tuesday evening,
- Matthew Fox
*ps. I ask each of you to arrive with your microphones initially muted (🎙️ 🚫 )and cameras off until the meeting commences.
**pps. Our first community call will be recorded (🎥 ✅ ) and uploaded to Substack for those of you unable to attend.
Fox MetaCapital’s Weekly Asset Review + Technical Analysis
📈📉 The Week Ahead in Charts
Symbols 📈 or 🐂 = Bullish / Positive | 📉 or 🧸 = Bearish or Negative | ⚖️ Ranging or Low Volatility
FOREX
⚖️📉 DXY(U.S Dollar) + ⚖️📈 CAD
💬 Matthew’s Commentary, Analysis & Prediction for the Week Ahead:
Over the past week, there has been a surge of news related to the BRICS nations potentially reducing their dependence on the USD for international trade. Additionally, breaking news at the time of writing reveals that OPEC is considering cutting oil production.
The question on everyone's mind is: how will these events impact the markets?
Specifically, what effect will they have on the US dollar?
Historically, when Oil prices rise this would indicate an increase in the demand for U.S Dollars as remember, the USD has been the dominant global reserve currency for international trade.
However, we can now begin to triangulate a checkmate-like strategy by the BRICS nations to axe their USD reliance and begin raising the price of Oil as moving forward their trade will likely be in Chinese Yuan.
To be honest, I cannot find any reasons to be bullish on the US dollar at the moment. Therefore, I expect some volatility at the beginning of the week, with the DXY re-testing the range median, then moving towards the range lows, and eventually breaking down to the 100.50 target area within a few weeks.
If this scenario plays out, it could create momentum for risk assets such as equities and cryptocurrencies.
So, be prepared for an eventful Q2.
Featured Chart DXY 3D (click to enlarge photo)
Yes, the Canadian dollar (CAD) is often seen as a commodity currency, and it is heavily influenced by the price of oil. As we have discussed, the move by the BRICS nations to trade in yuan instead of the USD could lead to a weakening of the USD, which could potentially benefit the CAD.
This is because a weaker USD can make oil and other commodities more expensive in USD terms, which can increase demand for the CAD and lead to a strengthening of its value. Additionally, rising oil prices can benefit Canadian oil producers, which can increase revenues and profitability, leading to a positive impact on the Canadian economy and capital markets.
I’m targeting a deviation to the range highs between .745-.75 for the CAD
Featured Chart CAD 3D (click to enlarge photo)
Equities
📈S&P500 + 📈TSX + ⚖️ VIX
💬 Matthew’s Commentary, Analysis & Prediction for the Week Ahead:
Although there were concerns around layoffs and weakness in the banking sector, the S&P500 managed to have a strong quarter.
Since its bottom in October 2022, the market has been forming higher lows and higher highs, breaking its bear market trend.
This trend has been fueled by a resilient US economy that didn't bow down to the hot labor market that flew in the face of the Fed who have been hiking interest rates to the moon.
Still, on the backs of consistently above-estimate corporate earnings, investor sentiment remained bullish.
Looking ahead, it's reasonable to assume that this trend may continue into Q2, with the S&P500 potentially reaching the highs of 4200 before gathering sufficient momentum to sweep 4300.
This could potentially end the speculation around a further downside collapse being reported by mainstream media and large institutions paying for FUD headlines.
Featured Chart S&P500 3D (click to enlarge photo)
Just North, the TSX is also looking strong aiming to reclaim range support ~19,905.
If successful, the bulls will bring into play a continuation upwards taking out the range highs of 20,800 before setting the stage for a potential all-time high on the TSX in 2023’.
Featured Chart TSX 3D (click to enlarge photo)
I expect the VIX to anticipate news before it even hits the headlines, showing us what's to come.
It appears to be setting up for continued ranging throughout 2023 and 2024, making it crucial to monitor as it reaches and pivots from resistance or support levels.
In April, I anticipate a short range of consolidation at these lows, allowing for capital to flow into risk assets like equities and crypto.
Keep an eye on the VIX as it will likely provide insight into market sentiment and possible future events.
Featured Chart VIX 3D (click to enlarge photo)
Treasuries
📉 US2YR & 📉 US10YR
💬 Matthew’s Commentary, Analysis & Prediction for the Week Ahead:
Treasuries experienced a significant drop in Q1, the largest in over a decade.
In looking at the trend, my opinion is that it’s unlikely to reverse anytime soon.
While there was talk of an inverted yield curve in the past, I expect this discussion to come to a halt by mid Q2/Q3.
As we move into the next month or so, I’m expecting the 2-year and 10-year treasury yields to hit their targets of 3.5% and 3.0%, respectively.
It's worth noting that potential rate pauses may have a significant impact on treasuries in April / May. If the Fed does decide to pause its rate hikes, it will likely result in a temporary boost for the treasury market, causing yields to decrease.
Featured Chart US2YR 2D (click to enlarge photo)
Featured Chart US10YR 3D (click to enlarge photo)
Cryptocurrencies
⚖️📈 Bitcoin & 📉 BTC.D + ⚖️📈 XRP + ⚖️📈 Total Crypto Market Cap + Altcoin Market Cap ⚖️📈
💬 Matthew’s Commentary, Analysis & Prediction for the Week Ahead:
Bitcoin has been consolidating between 26.5K and 29K for the past week, and some traders have been adding short positions, anticipating a pullback. However, Bitcoin has not shown any significant downside momentum.
Interestingly, the buildup of short positions slightly above 29K has created a market situation that is primed for a short squeeze to the upside before retracing back to take out the range low liquidity.
It's important to note that there is historically a strong correlation between the S&P500 and Bitcoin. If investors begin to fear the impact of rising oil prices on CPI and expect hawkish policy moves from the Fed in May, this could lead to a sell-off situation where Bitcoin falls back to 25.5K or 21.5K.
We will discuss Bitcoin and the broader crypto market on our call Tuesday.
Featured Chart BTC 1D (click to enlarge photo)
It's important to keep in mind that in the crypto market, Bitcoin tends to attract the most liquidity and drive bullish price movements. Once this momentum subsides, profits often flow into altcoins.
As such, monitoring Bitcoin's dominance in the market can serve as a signal for an impending altcoin season.
Based on this analysis, it appears that an altcoin season may be approaching should we not get a punch to the face from further geopolitical or macroeconomic shockwaves.
Featured Chart BTC.D 3D (click to enlarge photo)
XRP moves last, but it moves fast.
XRP had one of its best weeks on record in years, surging to nearly $0.60 as many speculators accumulated heavy long positions, expecting the much-anticipated and heavily publicized Ripple vs. SEC lawsuit to be resolved.
But in typical #XRPCommunity fashion, there wasn’t a peep from the courts.
Therefore, we turn to the charts for more answers.
In its rise, we can clearly identify two major impulses - the 1st and 3rd wave - indicating that we’re likely on the Wave 4 correction at the time of writing, leaving room for one last impulse upwards into a final target of $0.65 before any considerable pullback.
However, this move is not guaranteed given recent breaking news, and we will cover XRP on our call on Tuesday.
Featured Chart XRP 12HR (click to enlarge photo)
Featured Chart TOTAL 3D (click to enlarge photo)
Featured Chart TOTAL2 1D (click to enlarge photo)
Commodities
📈 Oil + 📉 Gold & 📉 Silver
💬 Matthew’s Commentary, Analysis & Prediction for the Week Ahead:
As mentioned earlier, oil is poised for a major breakout that could potentially result in a significant increase in price per barrel.
My current target is upward of $95 per barrel in Q2, and I will wait for the US reaction before making any further speculations on price movements.
During our call on Tuesday, we will cover all commodities, but to summarize, oil is looking promising while gold and silver may take a back seat for a few weeks before I speculate on a parabolic increase in their prices. I will provide more information about my thesis on Tuesday's call.
Featured Chart Oil 3D (click to enlarge photo)
Featured Chart Gold 1D (click to enlarge photo)
Featured Chart Silver 1D (click to enlarge photo)
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