Daily News | Fed Hawkish Rate Hikes Continue, BoE Rate Hike Thursday, US Jobs Friday

Macro

📣 Bitcoin (BTC) 24-Hour Change: 20,210 (-1.55%)

On Thursday, the correlations started reversing since Fed’s rate hike announcement, implying

- Correlation with S&Amp;P 500: Current: 0.78; 24HR: 0.79; 1W: 0.51

- Correlation with Nasdaq: Current: 0.57; 24HR: 0.64; 1W: 0.52

📣 Ether (ETH) 24-Hour Change: 1,532 (-3.61%)

Likewise to BTC, Ether begun to see a deceleration around the current correlation ratios.

- Correlation with S&Amp;P 500: Current: 0.80; 24HR: 0.82; 1W: 0.58

- Correlation with Nasdaq: Current: 0.50; 24HR: 0.57; 1W: 0.53

📣 Bank of England Interest Rate Decision

Consensus: 3%; Previous: 2.25%

BOE Bond Sale Attracts Traders Buying Scarce UK Debt

- Nov. 2nd, 2022, 08:48 PM UTC, The Bank of England’s inaugural sale of bonds purchased under its quantitative easing program saw traders place almost £1 billion of bids on a single bond maturing January 2026.

- Whatever the Bank of England decides on Thursday — and the consensus is for a 75 basis-point rate hike — it will be based on the assumption of a pretty sharp fiscal consolidation when the government announces its plan on Nov. 17.

📣 United States Balance of Trade

Consensus: -72.2B; Previous: -67.4B

- The trade deficit in the US narrowed to $67.4 billion in August of 2022.

📣 ISM Non Manufacturing Employment

Consensus: 55.5; Previous: 56.7

- PMI came in at 56.7 in September, pointing to the growth above the historical average of 55.

- A slowdown was reported in business activity (59.1 vs 60.9) and new orders (60.6 vs 61.8). On the other hand, employment improved (53 vs 50.2) and supplier deliveries grew at a slightly slower rate (53.9 vs 54.5). At the same time, price pressures eased again (68.7 vs 71.5).

📣 Wednesday

🔹 ADP Employment report

Actual: 239K; Consensus: 195K; Previous: 192K

- Came in nicely ahead of expectations with 239,000 private jobs versus expectations for 185,000.

- Unemployment at 3.5% is matching five-decade lows. Job openings, which Powell watches closely, unexpectedly rebounded in September, with the ratio of available positions for every Unemployed person now at 1.9.

🔹 FOMC Statement

Actual: 4.00% (+0.75%); Consensus: 4.00% (+0.75%); Previous: 3.25% (+0.75%)

- Equities futures were mixed ahead of the Federal Reserve’s policy meeting Wednesday. A gauge of the dollar (DXY) fell and gold (XAU) rose.

- Two-year US yields -- which are more sensitive to imminent Fed moves -- topped 4.5% after sliding as much as eight basis points earlier in the day.

- The ADP Employment Report for October. This report is for private payrolls only (no government). The consensus is for 200,000 jobs added, down from 208,000 in September.

- FOMC Meeting Announcement. The FOMC is expected to raise rates 75bp at this meeting.

- Fed Chair Jerome Powell holds a press briefing following the FOMC announcement. Focus will be on his comments following the decision as traders seek clues about where policy is headed.

- The Fed’s benchmark is lifted to a 3.75%-4% range, from nearly zero in March. Even so, the US economy has shown remarkable resilience: Rising borrowing costs have slowed the housing market, but the inflation rate is stubbornly stuck near 40-year highs.

- US equities reversed initial gains, with the S&Amp;P 500 suffering its worst rout on a Fed decision day since January 2021 as investors digested the message. Bitcoin (BTC) and Ether (ETH) followed the general sentiment and gave back some of the gains.

📣 Tuesday

🔹 Hong Kong Global Financial Leaders’ Investment Summit

- People’s Bank of China Governor Yi Gang said he hoped the property market can achieve a “soft landing,” noting an improvement in housing sales and lending. Yi said the economy remains broadly on track.

- Fang Xinghai, a vice chairman of the China Securities Regulatory Commission, said China would continue to open up because it needs more high quality institutional investors. “We want to share China’s growth with the rest of the world.”

- The Hang Seng China Enterprises Index gained as much as 3.2%, reversing earlier losses, adding to a 5.5% surge in the previous session. China’s CSI 300 Index advanced nearly 2%, following a 3.6% gain on Tuesday.

- The Securities and Futures Commission plans to only allow crypto ETFs linked to Bitcoin and ether futures traded on the CME. The regulator will launch a public consultation on giving retail investors access to virtual assets. ETF managers need to have at least a three-year track record.

📣 Monday

🔹 ECB Rate Hike

- European Central Bank President Christine Lagarde said the peak of the current cycle of interest-rate increases must ensure that inflation returns to the 2% target over the medium term.

- Without specifying a level for the so-called terminal rate, Lagarde said borrowing costs have further to rise following last week’s second straight 75 basis-point hike.

- Inflation in the 19-member eurozone hit a record 10.7% in October, overshooting analyst estimates even as economic growth weakened.

📣 Catalysts this week:

- Thursday: Bank of England rate decision, US Trade &Amp; Jobs Data

- Friday: US nonfarm payrolls (NFP) &Amp; Unemployment, ECB President Statement



🔴 BTC
BTC Weekly timeframe:

Major Level: 20,516 (61.8% Monthly Fibonacci Retracement Level)
Closest support zone: 20,516 - 20,885
Key resistance level: 21,002 - 21,690


As of Nov. 03 Asian session,

- Bitcoin (BTC) was trading below the 61.8% (20,516) monthly Fibonacci Retracement level

🔹 but still within a support zone (19,792 - 20,885) derived from Sep. 12 - 19

🔹 an anchor point has been established at 20,331

After reaching the 12-Day EMA (20,600) resistance level that drove Tuesday’s decline to the 50% (20,331) Fibonacci level, BTC has now found an anchor point.

BTC Weekly Resistance zones
20,516 - 20,885
21,002 - 21,690
21,737 - 22,577

BTC Weekly Support zones
20,516 - 20,331
19,858 - 19,145
19,960 - 18,472


BTC Daily Timeframe:

Closest support zone: 20,448 - 20,316
Closest resistance zone: 20,627 - 20,735
Key Level: 61.8% (20,516) monthly Fibonacci Retracement level


Nov. 03 02:12 UTC Update:
Bitcoin (BTC) was trading at $20,319, or down 0.81% in a 24hr period.

BTC Daily Resistance zones
20,388 - 20,491
20,516 - 20,594

BTC Daily Support zones
20,071 - 19,981
19,899 - 19,858


🔵 ETH
ETH Weekly Timeframe

Major Level - Weekly resistance level of 1,760 (Weekly High of Feb. 01, 2021)
Closest support zone: 1,595 - 1,552
Key resistance zone: 1,651 - 1,694


As of Nov. 03, Ether (ETH) was trading below the 61.8% (1,554) Weekly Fibonacci retracement level

🔹 and within a support zone (1,552 - 1,639) derived from Aug. 29 - Sep. 05

🔹 but below the 78.6% (1,651) level measured from Sep. 12 - 26

To confirm a trend reversal to the upside, Ether will have to close above the previous “lower-high” price action formation on Sep. 12, therefore the weekly resistance level of 1,760 is a key level going into the next two weeks when the bulls make an attempt to push the price of ETH even higher.

On the other hand, ETH bears will likely use the 23.6% (1,694) monthly Fibonacci Retracement level as an anchor point to drive down Ether. This is to invalidate a bullish signal by preventing the price of ETH to make a “higher-high” price action formation.

ETH Weekly Resistance zones
1,595 - 1,639
1,651 - 1,694
1,735 - 1,760

ETH Weekly Support zones
1,595 - 1,552
1,552 - 1,494
1,456 - 1,402


ETH Daily Timeframe

Closest support zone: 1,517 - 1,507
Closest resistance zone: 1,547 - 1,556
Key Level: 1,554 (Daily Close of Oct 28. 2021)


Nov. 01 02:03 UTC Update:
ETH was trading at $1,545, or down 2.3% in a 24hr period.

ETH Daily Resistance zones
1,547 - 1,556
1,569 - 1,575

ETH Daily Support zones
1,517 - 1,507
1,488 - 1,478


📌 The topic of the Day: The Federal Reserve raised interest rates by 75 basis points for the fourth time in a row

On November 3, the Federal Reserve raised the benchmark interest rate by 75 basis points to 3.75% - 4.00%.

It is the highest federal fund interest rate since January 2008. It is also the fourth consecutive interest rate increase of 75 basis points by the Federal Reserve after June, July, and September this year. In addition, it is also the sixth interest rate increase by the Federal Reserve in this round of interest rate hike cycle. This year, the cumulative interest rate increase has been 375 basis points.

Federal Reserve Chairman Powell stated that he was firmly committed to reducing inflation. Without price stability, the labor market will not remain strong. He also emphasized that the Federal Reserve is likely to slow down the rate hike in December and January next year, and will no longer maintain the pace of 75 basis points of interest rate hike. But the Fed has not considered suspending the pace of interest rate hike.



🗓 Happenings of The Week (Oct. 28 - Nov. 03):

📣 Notables:
🔹 European Commission proposes real-time euro payments in draft law. The proposal aims to increase public trust in real-time payments and make sanctions screening more efficient. A digital euro prototype expected to pilot in Mar. 2023 is in the works under the supervision of the European Central Bank.

🔹 Hong Kong plans to green-light crypto ETFs and review rules barring retail investors from trading digital assets. The Securities and Futures Commission plans to allow crypto ETFs linked to Bitcoin and ether futures traded on the CME. The regulator will launch a public consultation on giving retail investors access to virtual assets.

🔹 Singapore pilots tokenized fiat with smart contract capabilities. Singapore-based financial services group DBS will issue digital Singapore dollars, while Open Government Products, a tech team within the Singapore government, will enable smart contract capabilities.

🔹 The Reserve Bank of India, the country's central bank, to test if the digital rupee can cut fees when trading government securities. The pilot will focus on the settlement of secondary market transactions in the trading of government securities. RBI says “going forward, other wholesale transactions, and cross-border payments will be the focus of future pilots, based on the learnings from this pilot.”

📣 Nov. 03
🔹 Instagram will support creators to mint and sell NFT directly in their applications. Meta announced that Instagram is developing NFT minting and selling functions for creators. The creators will be able to create their own digital collections on Instagram and sell them directly to fans on/off Instagram. Polygon is the first partner Meta has selected for this feature.

🔹 OpenSea introduces two new NFT anti-theft functions. One is the new anti-theft function, which will actively scan the website to prevent malicious links from appearing on the fraud collection list. The other is the new detection function, which will automatically detect and mark NFTs that may be stolen or transferred suspiciously, and prohibit their transactions on the platform. OpenSea stated it was working with other companies in the NFT field to reduce fraud.

🔹 Musk plans to lay off half of Twitter's employees to reduce operating costs. According to Bloomberg, citing insiders, Musk proposes to cut 3,700 Twitter employees (approximately half of Twitter's total employees) to reduce its operating costs after the acquisition, and plans to notify the employees who have been laid off on Friday.

🔹 JPMorgan Chase executed a DeFi transaction on the public chain for the first time. According to Bloomberg, JPMorgan Chase previously issued tokenized S $100,000 on Polygon and traded with SBI Digital Asset Holdings in Japan as tokenized Japanese yen, which is part of the pilot plan of the Central Bank of Singapore to explore the use of DeFi in the banking industry. Although this transaction is not a cryptocurrency transaction, it is the first time for JPMorgan Chase to execute the transaction on the public chain. In addition, this transaction also involves the use of the "modified version" of Aave.

📣 Nov. 02
🔹 CryptoPunk # 5822 is recognized as the most expensive NFT collection by Guinness World Records. On February 12, 2022, the NFT was purchased by deepak Thapliyal (deepak.eth), CEO of Chain.com, a blockchain technology startup, with 8000 ETH (approximately $23.7 million), which is the highest transaction price of CryptoPunk series NFT in history.

🔹 The first batch of digital assets and DeFi industry pilots launched by the Monetary Authority of Singapore. In the first batch of industry pilots, DBS Bank, JPMorgan Chase and SBI Digital Asset Holdings conducted foreign exchange and government bond transactions for the liquidity pool consisting of token Singapore government bonds, Japanese government bonds, Japanese yen (JPY) and Singapore dollar (SGD).

🔹 Deribit, a crypto derivatives trading platform, announced that its hot wallet had been stolen, resulting in a capital loss of $28 million, but the customer's capital was safe, and the loss was made up by the company's reserves. Deribit stated that it was conducting security checks and suspended withdrawals including third-party custodian agencies Copper Clearoop and Cobo.

🔹 Gary Gensler, chairman of the US Securities and Exchange Commission, sent a message on social media to congratulate the 14th anniversary of the launch of the Bitcoin white paper. He stated: “Congratulations on the 14th anniversary of the launch of Satoshi Nakamoto's white paper! It brings innovation and investment in crypto assets. As cryptocurrency enters its 15th year, let's ensure that investors are properly protected.”

📣 Nov. 01
🔹 Open Metaverse Alliance (OMA3) opens up membership to web3 builders. OMA3 includes Animoca Brands, The Sandbox (which is one of its subsidiaries) and several brands the company has invested in — Alien Worlds, Dapper Labs, Splinterlands, Star Atlas and Upland.

🔹 DeFi yield platform PieDAO proposes token buyback after ending liquidity mining program. For the PieDAO team, the buyback is necessary to prevent any adverse impact on the DOUGH price from any forced selling by liquidity providers — although the token is already down 98%.

🔹 NFL Rivals releases footage of “arcade-style” gameplay ahead of upcoming NFT drop. The game is one of many sports-themed blockchain projects in the works, including partnerships with NBA, MLB and UK’s Premier League.

📣 Oct. 31
🔹 Aptos-based DeFi project Arco Protocol is facing criticism after a error-struck token sale and a sudden loss of key partnerships. The project has asked its community whether it still backs it, or if the project should just completely shut down.

🔹 HUSD stablecoin sharply loses peg even further, drops to just $0.30. This comes after the stablecoin was delisted on Huobi.

🔹 GameStop's NFT marketplace is live on Immutable X, a Layer 2 Ethereum scaling protocol, rivalling crypto-native gaming NFT platforms like Fractal, founded by Twitch’s Justin Kan. The marketplace will offer assets for Immutable X games, such as Gods Unchained, Guild of Guardians and Illuvium, in addition to other web3 games.

🔹 Art Gobblers, an NFT project co-created by Rick and Morty’s Justin Roiland, nabbed more than $13 million just two hours after launch. Art Gobblers brought in an ETH volume of 7,480 ETH, with 925 unique owners and a floor price of 11.25 ETH.

📣 Oct. 29 - 30
🔹 Dogecoin rallies after Elon Musk’s Twitter takeover. Dogecoin was up 116.7% over the last week, after billionaire Elon Musk took over Twitter. Musk has floated allowing users to pay for Twitter’s premium features using Dogecoin (DOGE). In a separate report by Bloomberg, Musk might bring more crypto into Twitter, including using blockchain to reduce the presence of bots, a subject that had ignited a legal battle between Musk and the company that threatened the acquisition.

📣 Oct. 28
🔹 Magic Eden, Rarible join Twitter pilot to embed NFTs in tweets. “Tweet Tiles” are a way to attach customizable formats to a Tweet. They're still in the testing phase.

🔹 Metaverse platforms to fall under scope of controversial UK Online Safety Bill. The bill is currently making its way through the House of Commons. Platforms which fail to follow the rules will face fines up to 10% of their revenue and could be blocked.

🔹 WisdomTree meets estimates, reveals declining crypto holdings in Q3 earnings. The asset manager’s crypto holdings fell to $178 million from $406 million at the beginning of the year. CEO Jono Steinberg said “blockchain-enabled funds and tokenized exposures are tomorrow’s best structure,” to access various asset classes.

🔹 Matter Labs has released the baby alpha release of zkSync 2.0, the first Ethereum compatible ZK-Rollup to hit production. This compatibility is what will make it easy and quick for developers to port applications from the Ethereum mainnet to zkSync. In technical terms, it's called a "zk-EVM.”

📣 This week’s fundraising activities include but are not limited to:

🔹 CoinFund, a New York-based web3 investment firm, is looking to raise $250 million to invest in seed-stage startups. Previously, CoinFund has backed the Layer 1 blockchain Solana, web3 indexing protocol The Graph and blockchain infrastructure company Blockdaemon, among other startups.

🔹 Lingfeng Innovation Fund (LIF), a new venture capital fund led by former Binance Labs executive Nicole Zhang, raised $20 million to invest in web3 startups. The web3-dedicated LIF is a sister fund to Beijing-based Lingfeng Capital, the fintech investment firm with more than $400 million in assets under management.

🔹 Orderly Network, a DeFi infrastructure protocol built on the Near blockchain, raised $20 million with a $200 million valuation in a seed round with participation from Laser Digital and Sequoia China, Pantera Capital, Dragonfly and Jump Crypto via a simple agreement for future tokens (SAFT).

🔹 RakkaR Digital has raised $10 million in a seed funding round led by SCB 10X, a unit within Thailand's oldest bank, Siam Commercial Bank (SCB). RakkaR says its platform is powered by Fireblocks and aims to serve institutions in Southeast Asia.

🔹 Braavos has raised $10 million led by Pantera Capital to launch a self-custodial wallet on Ethereum scaling solution Starknet. The team will roll out features such as a “forgot my password” mechanism and multi-factor authentication, to make the experience more familiar to a web2 audience.

🔹 State-chartered digital asset bank Custodia, formerly known as Avanti, has raised $7 million. Custodia is designed to provide real-time settlement finality for U.S.-dollar payments in digital asset transactions.

🔹 Tharsis Labs, the core developer of Evmos, raised $27 million in a seed funding round led by Polychain Capital, and participated by Galaxy, Huobi, HashKey, Coinbase Ventures, Circle Ventures, Asymmetric and some angel investors from the Web3 field. The financing will support Tharsis Labs to carry out more development on Evmos and accelerate the growth of Evmos ecosystem.

🔹 Centrifuge, a decentralized asset management protocol, raised $4 million participated by Coinbase Ventures, BlockTower, Scytale and L1 Digital. BlockTower and MakerDAO will create a $220 million capital pool on Centrifuge.

📣 This week’s on-chain criminal activities include but are not limited to:

🔹 A series of protocol exploits and hacks across October saw malicious actors make off with at least $652.2 million in illicit gains. October proved to be nothing if not spooky for an ecosystem that saw as many as 44 exploits affect at least 53 protocols accounting for $657.2 million in total losses.

🔹 FriesDAO hacked for $2.3 million in the latest Profanity exploit. The DAO’s deployer wallet was generated with an insecure tool called Profanity, a wallet-generator tool that’s known to contain a critical vulnerability.

🔹 Deribit has restored BTC, ETH and USDC coin withdrawing functions to users. In addition, Deribit stated that it had appointed an on-chain forensics company to assist in tracking and recovering assets and liaising with global law enforcement authorities, and fortunately, the customer or account information had not been disclosed.

🔹 Skyward Finance, a NEAR on-chain asset issuance platform, suffered from vulnerability exploitation and has lost 110 NEAR tokens (approximately $3 million). Ref Finance and Skyward teams have been informed of the existence of the vulnerability. It is reported that the hacker purchased a large number of Skyward tokens on Ref Finance, and then "redeemed them through the Treasury on Skyward Finance", thus obtaining more income than the value of the Skyward tokens initially invested.

🔹 Solend, a lending protocol on Solana, tweeted that it detected an oracle attack against USDH that affected the isolated pool of Stable, Coin98 and Kamino, which had resulted in a bad debt of $1.26 million. In addition, Solend stated that all other pools, including the Main pool, are safe. Presently, Solend has disabled the suffered pool and informed the exchange of the attacker's wallet address.



Author: Gate.io Researcher Peter L. &Amp; Byron B.
This article represents only the researcher's views and does not constitute any investment advice.
Gate.io reserves all rights to this article. Reposting the article will be permitted provided Gate.io is referenced.
In all other cases, legal action will be taken due to copyright infringement.