On this Wednesday, August 24, 2022, bitcoin, like many of us, is on vacation. Little movement besides a fall of more than 10% which occurred on August 19th. Inflation and the macroeconomic context still play a strong role in this concern. Despite everything, bitcoin preserves its support of $20,000 and ETH is over 100% of its low point of $800. Let’s start right away with this week’s bitcoin 360 point. I will try to be as complete as possible, by sharing my feelings on the market. Good reading !
A forbidden medium
The $20,000 zone is very interesting. It marks the top of the 2017 market and this price is a support with strong momentum. Nevertheless, the green candles struggle to be felt and a simple red candle can eliminate a good part of them.
A risk-off market
The market always seems risk off, meaning that stronger assets such as bonds are preferred given the situation in which we find ourselves. Banks have never had as much cash in reserve as they do today, and this reflects the risk appetite of the big players.
An end to the holidays without too much volatility
When we zoom in to 1 hour time unit, we see that bitcoin is moving within a price range between $20,800 and $21,700.
Seasonality makes assets less volatile during this period. The return to school in September is historically bearish, and is one of the worst months on the stock market since 1900.
Before anticipating a rise or a fall, it will be necessary to wait for the release of this tidy who could guide us on the way forward in the weeks or months to come.
Personally, purchases below this tidy and sales at the top is an adequate strategy, in the sense that the stop-loss is defined and allows a limited loss for slightly larger gains.
A controlled lever
The ratio of Open Interest, open Bitcoin futures, continues to climb. Open interest is data published daily by the stock exchange. It can contain a lot of information about a trend that is emerging or weakening. Open Interest is the total number of unexpired contracts at the end of the trading day.
A strong OI (Open Interest) indicates that the open interest is large relative to the size of the Bitcoin market, which increases the risk of a squeeze long or short. Many contracts are open, especially long. Thus, in the event of a decline, the protective stop losses could jump, and thus accentuate an even greater decline.
Nevertheless, in this precise case, the Open Interest is not disproportionate, it follows the price without creating divergence. the funding is also neutral, which demonstrates a number of buyers equal to the seller. From a technical point of view, these rows are the proof.
A worrying economic situation in China
I am not without telling you that the real estate situation in China is very worrying. BlackRock and UBS are among the funds that are reducing their exposure to Chinese real estate. Other companies such as HSBC, PIMCO and Fidelity also reduced their positions during the first half.
Asia’s largest high-yield bond funds are steering clear of China’s property sector as a deepening liquidity crisis weighs on debt, according to research firm Morningstar Inc.
The average weighting of Chinese real estate bonds in Asian high-yield funds fell to 16% in June, from nearly 28% at the end of last year; as the borrowing crackdown and falling home sales continue to weigh on the sector.
Funds from global asset managers BlackRock Inc, Fidelity International Ltd, HSBC Holdings Plc, Pacific Investment Management Co and UBS Group AG posted double-digit losses through the end of July, according to the report. BlackRock’s high-yield fund cut its real estate exposure by almost half in June compared to December, to around 15% of the portfolio. PIMCO reduced it from 22% to 12%.
Meanwhile, fund managers are looking to high yield stocks from India and Southeast Asia as alternatives.
Fund managers have largely written off Evergrande Group, which was once the most actively traded high-yield bond in Asia before defaulting last year. Evergrande represents just 0.14% of BlackRock’s fund. PIMCO still holds four Evergrande bonds, representing 0.23% of the portfolio, according to Morningstar.
That’s it for today’s article. I tried to cover as many points as possible and carry more on the traditional market which guides cryptos. talk aboutaltcoins here makes far less sense than a macro analysis to me.
Finally, I receive multiple questions asking me on which site I analyze my values. Personally, and for several years, I have been using TradingView, an intuitive interface with a lot of tools and a wide choice of assets. It is clearly the most developed and used interface on the market.
This is the end of this analysis, do not hesitate to give me feedback on my Twitter account @0xakina. Don’t be too greedy, take profits regularly, have a good money management for your trades and rely on your initial plan. Only invest what you can afford to lose as long as it doesn’t affect your morale too much. Have a good week everyone, and I’ll see you next week for a new analysis!
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