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13 April 2018

Forex Technical analysis

Bitcoin Fundamental Outlook: Bitcoin rush is not over

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Cryptocurrencies have been under pressure during the tax season and pending regulation in the space. However, what caused the recent rally? This and more are discussed in today's 13 April Bitcoin Fundamental Outlook.

13 April, Swissquote – Reserve Bank of India (RBI) monetary policy meeting decision to maintain its key rate at 6% last Thursday rather than reduce it by 25 basis points shows that it got it right.

Indian inflation data stabilized

Indian inflation was contained during first quarter 2018 period, with March consumer price index given at +4.28% (prior: +4.44%) and below its 3-year average of +4.37%, supported by stable price components and particularly from Food and Beverages (+3%), accounting for 54% of the index as well as Fuels and Lighting (+5.73%) which could drastically impact inflation data due to India’s large oil imports.

February industrial production points the same way, given at +7.10% (prior: +7.40%) and maintained at 2 years highs, signalling strong economic momentum for the beginning of the year.

Positive impact on equity markets

Recent economic data had a positive impact on equity markets, valued at 34’300 (+1.44% year-to-date) and increasing by +2.01% since Monday. 2-year, 10-year and 30-year treasury yields keep increasing since the beginning of the year as investor sentiment continues to improve.

Accordingly, we suspect RBI to maintain its repo rate at 6% for the near term, expectations supported by RBI’s 12-month inflation forecast given in the range of 4.50% - 4.60%, signalling a rather stable price outlook. USD/INR strong rise started in January is faltered since mid-February. The currency currently valued at 65.25 is expected to trade sideways in the short-term, maintained at the 65.30 range.

13 April Bitcoin Fundamental Outlook: Bitcoin rush is not over

Bitcoin has surged more than US$1,000 from below $7,000 to around $8,050 in a bizarre surge that follows months of bearish consolidation. Its rise is pulling the rest of crypto sector higher. Technicians say the technical break of $7,450 triggered a surge in Bitcoin buying.

Despite talk of a crypto bubble, there remain significant investors who believe crypto will rally. Developments behind the scenes include new technology that will power faster transactions, blockchain projects and open-minded regulators: all will spark the next wave of crypto accumulation. Or perhaps price appreciation was Arnaud Masset (and Yann Isola) killer Crypto presentation yesterday in Geneva?

Disclaimer

This article  13 April Bitcoin Fundamental Outlook: Bitcoin rush is not over was written by Vincent Mivelaz & Peter Rosenstreich, analysts at Swissquote. While every effort has been made to ensure that the data quoted and used for the research behind this document is reliable, there is no guarantee that it is correct, and Swissquote Bank and its subsidiaries can accept no liability whatsoever in respect of any errors or omissions, or regarding the accuracy, completeness or reliability of the information contained herein.

This document does not constitute a recommendation to sell and/or buy any financial products and is not to be considered as a solicitation and/or an offer to enter into any transaction. This document is a piece of economic research and is not intended to constitute investment advice, nor to solicit dealing in securities or any other kind of investments.

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