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British Pound Adds New Gains as Finance Minister Set to Unveil New Fiscal Policy

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British Pound Adds New Gains as Finance Minister Set to Unveil New Fiscal Policy

After facing an unprecedented crash for the past few weeks, the British Pound Sterling is recording a new lease of life, riding on the highly anticipated course reversal by the new Finance Minister Jeremy Hunt. The GBP is up 0.8% to $1.1259, extending gains ahead of the announcement slated for 11 am local time today.

The broader market reaction to the change in the Finance Ministry was also seen in the performance of the UK Government Bonds also known as Gilts. With yields moving inversely to prices, the yields on the 10-year gilts dropped 30 basis points to 4.029% on Monday morning while the yields on the 5-year and 2-year gilts fell to 4.013% and 3.663% respectively.

The British economy was unsettled when former Finance Minister, Kwasi Kwarteng announced a broad-based tax cut without a corresponding revenue source to cushion the cuts and help sustain the economy. The UK markets were not prepared for such safe haven revenue sources to be pulled off and stakeholders revolted in what fueled a systemic plunge in the price of stocks and indices across the board.

Though the Bank of England (BoE) has done its best to help prop the market, there were no signs of cooling off, forcing the government to take a more aggressive approach to calm the market. When the pressure was too high to bear, Prime Minister Liz Truss had to fire Kwarteng and the new appointee, Hunt believes some moves were made too fast too soon and there is a need to reverse course.

While Hunt said he will be focused on growth, he said this will not be compromised with stability in any way.

“The drive on growing the economy is right – it means more people can get good jobs, new businesses can thrive and we can secure world-class public services. But we went too far, too fast,” Hunt said in a statement released Saturday.

Making the Right Call to Prop the British Pound

From the time the first fiscal plans were unveiled, a lot of industry and political leaders around the world knew it was a basis to unsettle the markets.

One of the world leaders who expressed pessimism about the Kwarteng tax cuts is United States President Joe Biden. Besides calling the tax cut plans a “Mistake” with an expression of how the economy of other countries can affect the United States, President Biden had reiterated that there was never going to be any interference and that whatever course is adopted in the near term will be up to Great Britain.

“I wasn’t the only one that thought it was a mistake,” Biden said. “I disagree with the policy, but that’s up to Great Britain.”

The International Monetary Fund (IMF) was also against the previous position of the government, and with the course reversal, many are expecting more than the British Pound to benefit in the long run.

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British Pound Adds New Gains as Finance Minister Set to Unveil New Fiscal Policy

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Where Is The Ethereum Price Headed Next After Clearing This Resistance

The Ethereum price has finally been able to break above the $1,233 resistance mark. Over the last 24 hours, the coin has registered substantial gains. With the price moving above the $1,233 resistance level, Ethereum price has pictured a positive short-term bullish thesis on its one-day chart.

Technical outlook also agreed with the same and depicted a rise in demand for the king altcoin. Buyers will need to stick around for longer than the next couple of trading sessions for ETH to reach above the $1,300 price mark.

The price of ETH must remain above $1,200 and $1,230, or else the bears will return. This would mean Ethereum could drop to a psychological floor of $1,000. The altcoin has logged considerable gains over the past week’s duration, surging more than 11%. ETH’s chart depicts accumulation, which is good for short-term bullish momentum.

Ethereum Price Analysis: One-Day Chart

Ethereum was priced at $1,260 on the one-day chart | Source: ETHUSD on TradingView

ETH was exchanging hands at $1,260 at press time. The next area of resistance for the altcoin stood at $1,280. It is, however, too early to determine if the altcoin has stabilized over the $1,230 price mark. It needs to trade above the $1,260 zone for the next trading sessions for the bulls to strengthen further.

In case of this, the other price ceiling crucial for ETH’s upward movement was $1,350. On the other hand, a fall from the current price zone will take the price to $1,200 and then straight to $1,000. The amount of Ethereum traded in the last session increased, which showed bullishness.

Technical Analysis

Ethereum registered positive buying strength on the one-day chart | Source: ETHUSD on TradingView

ETH had nosedived into the selling zone at the beginning of this month; however, the altcoin has finally moved closer to the positive buying zone. The Relative Strength Index shot up to the neutral zone after remaining in the selling zone most of the month.

This indicated that demand for the altcoin had returned to the market. A continued push from buyers will drag the indicator past the 50-mark, depicting more buyers than sellers. In relation to that, the Ethereum price moved above the 20-Simple Moving Average line, which meant that buyers were driving the price momentum in the market.

Ethereum displayed a buy signal on the one-day chart | Source: ETHUSD on TradingView

In correspondence to other indicators, the altcoin depicted a buy signal on the one-day chart. The Moving Average Convergence Divergence (MACD) indicates price momentum and trend reversal.

MACD formed green signal bars above the half-line, indicating that if buyers acted on them, ETH would give returns. Bollinger bands depict price volatility and fluctuation; the bands were narrow, indicating price stability for Ethereum.

Featured image from Unsplash, Chart: TradingView.com

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Coinbase Drops XRP & Other Tokens, Cites Low Activity

As the FTX saga continues, all eyes are on crypto exchanges: Coinbase, Crypto.com, Binance and the like all have hefty sets of eyes on their next moves.

There is plenty to be said for the state of crypto exchanges today, but Coinbase’s announcement of the delisting of several tokens: BCH, ETC, XLM, and XRP. Let’s dive into the state of crypto exchanges currently, and more on Coinbase’s latest announcement.

Exchange: Status Check

While Binance CEO Changpeng ‘CZ’ Zhao has seized the spotlight as crypto’s ‘main character’ lately, Crypto.com’s leadership team – spearheaded by CEO Kris Marszalek – has largely been on the defensive, while Coinbase has been treading their steady positioning. Plenty of other major headlining exchanges have followed suit with Coinbase. Many have sought to maintain posture and look to keep ‘business as usual’ to weather the storm.

Nonetheless, the spotlight is on. As more threads unravel around the FTX saga, consumer trust is impacted in immeasurable ways; one consistent thread is that all exchanges, the aforementioned 3 and beyond, have faced pressures to increase transparency around reserves.

That could lead to exchanges at large preparing for increased regulatory oversight, particularly with the U.S. Senate hearing regarding FTX less than 48 hours away.

XRP is frequently a top 10 token in biggest market cap in crypto; however, Coinbase has elected to no longer support trading of the token, citing “low activity.” | Source: XRP-USD on TradingView.com

Coinbase’s Delisting

We haven’t seen a delisting from Coinbase in recent memory. In a tweet announcement earlier on Tuesday, Coinbase announced the token delisting:

1/3: After careful evaluation, we will be removing support for several networks with low activity on Coinbase Wallet starting in January 2023—including BCH, ETC, XLM & XRP. These routine evaluations allow us to continue investing in new features that make web3 more accessible.

— Coinbase Wallet (@CoinbaseWallet) November 29, 2022

 

Coinbase, once notorious for being too lenient on their coin adoption policy, is tightening the belt and cutting the fat. The move may surprise those that pay attentive to tokens not named Bitcoin and Ethereum. XRP is generally seen as a low-cost token that is easy for cross-exchange swaps with it’s low fees. Similar sentiment is often shared with fellow delisted token Stellar (XLM), and both tokens typically sit in the top 25-50 in terms of biggest tokens by market cap – making them surprising cuts considering some of the more fringe, lesser-known tokens that Coinbase has listed previously.

The final two tokens, Bitcoin Cash (BCH) and Ethereum Classic (ETC) are both the result of forks and will be recognizable to more legacy crypto users who can recall when these tokens came into existence as early ‘forked coins’. Their stagnant performance and slow retraction of relevance has led to an unsurprising result with this announcement.

Users impacted should refer to Coinbase’s blog post on the matter for more details.

Featured image from Coinbase.com/press, Charts from TradingView.com
The writer of this content is not associated or affiliated with any of the parties mentioned in this article. This is not financial advice.
This op-ed represents the views of the author, and may not necessarily reflect the views of Bitcoinist. Bitcoinist is an advocate of creative and financial freedom alike.

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Elon Musk Implores Fed to Cut Interest Rates or Risk Economy Tumbling into ‘Severe’ Recession

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Elon Musk Implores Fed to Cut Interest Rates or Risk Economy Tumbling into ‘Severe’ Recession

Elon Musk believes that the Federal Reserve must cut interest rates immediately or risk incurring a severe recession. The outspoken Tesla CEO made his opinion known in an early tweet Wednesday, which read:

“Trend is concerning. Fed needs to cut interest rates immediately. They are massively amplifying the probability of a severe recession.”

According to Musk, the Fed’s attempt to rein in runaway inflation could worsen the economic situation. As it stands, the prices have skyrocketed, and several households across the US are feeling the crunch. Energy prices are hovering at record-high levels, and the tech space and crypto industry are wallowing in significant devaluation.

Musk has warned of an impending recession before. On October 24th, the brash billionaire estimated a global recession could last until the spring of 2024. Although Musk admitted he was “just guessing,” his prediction came amid other gloomy economic forecasts from several business leaders. Some of these leaders were Amazon CEO Jeff BezosJP Morgan CEO Jamie Dimon, and Goldman Sachs CEO David Solomon.

Latest Elon Musk Recession Warning Sparks Twitter Debate

The latest remarks by Elon Musk on a likely recession comes in an exchange with Tesmanian co-founder Vincent Yu. Like Musk, the Tesmanian co-founder had earlier expressed concern about the economy’s health and forewarned a recession next year. The Twitter exchange between Musk and Yu sparked participation from several other users who also chimed in. While a few seemed to side with the Fed’s position on interest rates, others frowned on hiking rates to stem inflation. Furthermore, a small number of Twitter users expressed ambivalence at the Fed’s stance. For example, a user with the handle @CricketSurfing stated:

“I don’t know where the sweet spot is in terms of interest rates, but the goal should be to allow the M2 money supply to grow at about the rate of GDP. Right now, the Fed is *shrinking* M2. They have slammed on the brakes, when they should have eased off the accelerator.”

Sven Henrich Also Chimes In

Also notable in the thread on interest rates is input from NorthmanTrader founder Sven Henrich. According to Henrich, the Fed’s actions on perceived inflationary pressure were overdue. As a result, the US apex bank has tried to make up for its decisive delay amid the aggressive tightening of a record-high debt construct. However, Henrich lamented that the Fed is implementing its strategy without “accounting for the lag effects of these rate hikes”. The NorthmanTrader concluded by predicting that the Fed would realize the extent of the damage of its decision too late.

Like Yu, Henrich’s assessment of the Fed decision drew an affirmative response from Musk.

Henrich also slammed the Fed further by stating that the central bank continues to project positive GDP growth for 2023. He reasoned that such misplaced optimism comes amid the obvious signs but does not appear surprised by this. According to Henrich, the Fed displayed the same misplaced GDP optimism in 2008 en route to the economic meltdown of ’09. Henrich concludes his criticism of the Fed by saying:

“As always, they will panic cut rates once the recession impact is here & then blame unforeseen factors.”

Read more business news on Coinspeaker.

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