🗞 Weekly Market Newsletter | Edition No. 08

News Update + A Full Analysis of Major Indices Including Stocks, Crypto, Commodities, Bonds & Forex

Matthew Fox

Aug 29, 2022

Sunday August 28th 2:44pm

Hello Everyone,

The storm has started.

For a select few, the rain is understood as a part of nature and welcomed.

For others, the sky is falling.

Which investor are you?

The masses flood the streets in fear, yelling the sky is falling, running chaotically in every direction.

The contrarian glances up and quietly says, “it’s the perfect day for an umbrella”, and continues along her way.

Which investor are you?

- Bramwell

BramwellFox MetaCapital’s Weekly News Recap

News Headlines Scribbles (& How I’m Thinking About Them….)

🗞 Jerome Powell’s Jackson Hole Speech

The markets bled $1.25 trillion following Jerome Powell’s speech on Friday anticipating more hawkish activity on behalf of the Federal Reserve.

💭 Bramwell’s Thoughts…
The most anticipated event of last week.
I tuned in to watch Jerome Powell on Friday morning and analyzed his tone, word selection, body language and watched as the markets bled a sea of red just minutes following his short monologue.
My initial takeaway was that the FED is doing their best to create the narrative that they will continue to suppress growth and aggregate demand until a consistent, meaningful trend of low CPI (inflation) has been achieved.
But the ‘doing their best to create the narrative’ part is the contrarian in me turning cheek to what appears fishy to my logical senses.
By continuing the hawkish tone, the U.S is ~~destroying~~ rocking the global economic equilibrium and further exasperating the high risk possibility of foreign trading partners defaulting on USD denominated debt.
Something feels off to me about the approach the FED is articulating publicly, it truly feels like a ‘point-the-masses-to-fear’ but then pivot to growth at the last minute to save the day.
Only time will prove me wrong on my bias, or right on my intuition.

🗞 The Mt. Gox Hack 137,000 BTC Distribution

At its peak in 2013, Mt. Gox handled 70% of all Bitcoin transactions worldwide.
In 2014, Mt. Gox was hacked for hundreds of thousands of Bitcoin, leaving its customers penny-less.
A near decade-long international settlement process has been in the works to return a portion of the lost assets to Mt. Gox customers in the form of either cash, or Bitcoin - that process is rumoured to commence as soon as next week.

💭 Bramwell’s Thoughts…
While the true amount of Bitcoin potentially being returned to customers is unknown, there is fear amongst the larger crypto community that this event could further create downside selling pressure on the entire crypto market.
Many speculate that even in its worst capacity (assuming 100% of the Bitcoin will be immediately liquidated) that the ~$3B volume will be absorbed by normal daily trading volume of Bitcoin and nothing to fear.
Other industry participants have chimed in tweeting that to their knowledge many consumers have chosen to receive cash, meaning it would be illogical for those who chose to receive their repayment in Bitcoin to immediately sell.
Again, time will unfold this outcome - but I will be paying close attention to this narrative.

🗞 Gary Gensler; Resign

Roslyn Layton, a prominent writer for Forbes.com, published an incredible ~~hit piece~~ article ~~on the corruption~~ calling for the resignation of Gary
Gensler, the acting chairman of the Securities & Exchange Commission due to his overarching policy of litigating by enforcement such blockchain industry innovators as Ripple while detailing other widely accepted ~~failures~~ criticisms he has faced by the public as a regulator.
The article was swiftly removed from Forbes.com, but not before hundreds of thousands of angry readers shared it amongst social media websites such as twitter.

💭 Bramwell’s Thoughts…
My journey in crypto has been defined by my deep research on the digital asset $XRP and its promising solution of solving cross-border payment solutions for the world.

My journey in crypto has also been defined by a 2-year long litigation by the SEC vs. Ripple accusing the company of selling XRP to the market as a security without registering with the SEC.

The lawsuit destroyed billions of dollars of XRP holders net worth and the case has been closely watched by the entire crypto industry while exposing corruption at the highest level behind the scenes of the SEC.

Since taking office, chairman Gary Gensler has opted to protect the financial interests of his corrupt predecessors while continuing a tirade of litigation efforts against crypto innovators and has provided zero clarity to the market on how to become compliant with their technological innovations.

Gary Gensler should resign.

🗞 Huawei CEO warns of a ‘Painful Decade Ahead’

The leaked memo of Ren Zhengfei, the founder of Huawei, warned his company last week that the next decade would be a painful decade of limited growth for the global economy, encouraging his company to double down on survival and cash flow to navigate the tough times ahead.

💭 Bramwell’s Thoughts…
This headline gave me chills as I've long predicted that the world would enter a paradigm shifting financial revolution spearheaded by the collapse of the US economy - marking the end of the U.S Dollar as the world's reserve currency.
As we approach the mid-term elections for the U.S government, i’ve been hedging my bias that those in power would do their best to sedate the poor voter sentiment by doing all in their power to stabilize financial markets, lower the cost of living (consumer price index) and try to ~~mislead~~ encourage the American people that everything would be okay.
But behind the scenes, the U.S is well aware that they are walking a tightrope of monetary and foreign policy that could explode the world as we know it at any moment - and I believe it’s this truth that Mr. Zhengfei was alluding to in his memo.

BramwellFox MetaCapital’s Weekly Market Review & Technical Analysis

📈 The Week Ahead in Charts

DXY (U.S Dollar Index)

❌ Last Weeks DXY Prediction: The potential A,B,C correction I was anticipating last week did not occur. I was incorrect in my prediction.

💬 📉Bramwell’s Commentary & Analysis: The dollar initially corrected off of the higher timeframe Gann Fan down to a low of 107.9 on Friday morning leading up to Jerome Powell’s speech; however, following the tone of his speech and the possible implications of further hawkish monetary policy, the markets bled red as the dollar soared to finish the week.
At the time of writing, the DXY has started the week with extremely strong momentum creating immense selling pressure on risk assets, the only hope for the immediate future is that this unfolds as a fakeout (or whipsaw) and early week the DXY rejects off the January 1974 high of 109.5 and reverses it’s bullish momentum downwards to the 103 region.

🐻 v. 🐂 (fight!) Bramwell’s Prediction for the Week Ahead: I’ve been bearish for 3 weeks on the dollar due to my triangulation that there will be much worse problems in the global economy should foreign nations default on US debt due to the rising interest rates.

As the phrase goes “..even a broken clock is right twice a day!”

Well, I’m going for the broken clock hail mary and predict that the dollar will whipsaw slightly above the 109.5 region and reverse to the median line of the ascending channel depicted in both the 1W and 12HR charts below.

I’ve drawn high timeframe possibilities for both scenarios.

The bearish scenario for risk assets; the DXY continues its rage to the top of the 1W channel reaching a top of ~117.
The bullish scenario for risk assets; my prediction.

Featured Chart DXY 1W

Featured Chart DXY 12 HR

S&P500

✅ Last Weeks SPX Prediction: I was correct on my prediction last week nailing the correction and bounce around the 4150 region; however the end of week remarks by Jerome Powell sent the S&P 500 below support and futures are opening up at the time of writing with heavy selling pressure.

💬 📉 Bramwell’s Commentary & Analysis: Should we assume that the A,B,C correction has finalized on the S&P 500 and that the previous weeks rally was it’s first impulse upwards, than we can assume that the selling action last week and into this week will mark a correction from the 4325 highs down to a .5 - .618 fib zone between 3925 and 4000. I’ve marked this path on the 3D chart below and gave a zoomed in look at this week's action on the 4HR chart as well.

This scenario would require the DXY to reject from the 109.5-110 region creating bullish demand on risk assets (much to the dismay of Jerome Powell 😈) but playing into my contrarian stance from earlier in the newsletter.

Should the 4000 region receive little interest, I'll assume that the A,B,C higher timeframe correction was more of a 1,2,3,4 wave and the 5th wave down may attempt to target the 400 MA in purple shown on the 3D chart.

🐻 Bramwell’s Prediction for the Week Ahead: I’m very bearish on the S&P 500 this week despite my higher timeframe bias that Q4 will be pivot bullish for growth assets. A correction to slightly above 3900 is expected.

Featured Chart SPX 3D

Featured Chart SPX 4HR

Bitcoin

❌ Last Weeks BTC Prediction: My Bitcoin prediction was completely off the mark. I expected one last liquidity push-up to 28.5K, rather, Bitcoin consolidated at support awaiting the FED’s Jackson Hole remarks.

💬 📉 Bramwell’s Commentary & Analysis: Bitcoin has broken it’s support and at the time of writing had been consolidating around the 2017 ATH of 19.6K, if the support holds i’ll expect a re-test upwards of 22K (green circle) however should the support fail, the last bullish soldiers will have to make a stand in the area marked by the red circle of support above 17.6 - 18.6K.

🐻 Bramwell’s Prediction for the Week Ahead: I’m bullish on risk in Q4 - I remain confident that Bitcoin is forming a larger bottoming base awaiting the official September interest rate hikes from the FED before commencing it’s leg upwards. The path until that point in time should be choppy and heavily manipulated by large whales to shake-out retail investors.

Featured Chart BTC 12HR

XRP

💬 📉 Bramwell’s Commentary & Analysis: XRP has shown impressive strength against Bitcoin in August; however, the Ripple coin will be no match for the heavy gravitational pull of Bitcoin’s price movements. Currently resting on channel support, it’s highly likely that XRP deviates below .30 cents re-testing the capitulation demand zone of .2975. Should the volume not come from the bulls at this 1/2 standard deviation median line marked by the red circle on the chart below, a further dip into the .25 cent region is likely.

🐻 Bramwell’s Prediction for the Week Ahead: Should XRP hit 25 cents i’ll be a buyer of epic proportions. Aside from any fundamental news headlines changing the ride for XRP, it’s very likely the price will chop between the .30 - .325 region this week. Spot buying is encouraged.

Featured Chart XRP 1D

Oil

✅ Last Weeks Oil Prediction: I’ve been nailing the Oil chart all summer and last week was no exception, a push-up into the low 90’s followed by a harsh rejection was expected and it’s exactly what occurred.

💬 📉 Bramwell’s Commentary & Analysis: I have marked a falling wedge on the 12HR chart for Oil below and it’s following the path perfectly down to my anticipated demand zone of $80 / barrel. No further adjustments to last week's path are required.

🐻 Bramwell’s Prediction for the Week Ahead: I fully expect for Oil to continue it’s path downwards this week reaching $80 / barrel in early September. I’ll be watching the price movements of Oil to help triangulate the direction of the DXY.

Featured Chart Oil 12 HR

Gold

✅ Last Weeks Gold Prediction: In July I predicted $1850/oz for Gold by September, and it’s chugging along perfectly.

💬 📉 Bramwell’s Commentary & Analysis: With the DXY soaring yet the US Government changing the definition of a recession, i’ll be interested in seeing how Gold plays out in Q4 as an inflation hedged asset. If the FED is working hard to lower inflation, one would expect for Gold to perform poorly; however, it’s my overarching bias that the DXY will fail that leads my intuition bullish on Gold - time will tell.

🐂 Bramwell’s Prediction for the Week Ahead: I believe Gold will commence the week finishing a short correction into the $1725 region (marked by (2)), followed by an impulse that takes us to my target of $1850 in early September.

Featured Chart Gold 1D

👋🏼 Hey!

Thanks for reading this week's edition of the Weekly Recap + Looking Ahead.

If you have any comments, feedback or questions on any material written in this edition please share as I'd love to continue a dialogue below.