Week Ahead with The Birb Nest (20.03.2023) – The Birb Nest
Welcome to The Birb Nest’s weekly market update. This week is expected to be a volatile one for financial markets, with major events and activities taking place. In this post, we’ll cover the previous week’s economic calendar, incoming economic news releases, and risk assets charts for Bitcoin and the main stock indices. We’ll also discuss the five main topics that occurred this week, including inflation concerns, cryptocurrency fluctuations, earnings reports, global trade tensions, and Federal Reserve policy. Let’s dive in!
Economic Calendar
The previous week’s economic calendar was very important for the incoming fundamental releases.
Incoming economic news release for this week:
As we saw last week, some riskier assets had positive or neutral results. However, inflation did not decrease as expected by the FED. Moreover, due to the current economic uncertainty with banks, the FED has changed its approach from hawkish to dovish, as predicted for this week’s Federal Fund Rates. More aggressive quantitative tightening could lead to a recession in the coming weeks/months, so the FED is in a difficult position to make any decision.
The primary event scheduled for this month is happening on Wednesday, March 22. This event includes the FOMC and Federal Fund Rates, which will likely cause a significant amount of market volatility. It is expected that this month’s rate hike will be 25 basis points, as the FED attempts to combat recent bank failures resulting from an excessive and rapid quantitative tightening, one of the quickest in decades. It is highly likely that this scenario will have a positive impact on the market, leading to increased bullish pressure in assets such as Bitcoin and Stock Indices.
You can track the expectations here – https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
You can also read more about the recent bank collapses in the previous Blog Post of The Birb Nest here.
Risk Assets charts
Bitcoin – BTC has recently broken the multi-month resistance level at 25.200. This breakout came after experiencing some bearish pressure and negative comments regarding inflation and the current economic environment. In addition, Bitcoin rebounded from the 200-Day moving average, confirming the recent trend flip. It is important to keep in mind that there may be possible rejection from the high volume node above as the price moves towards this significant chart location. Otherwise, acceptance inside this range formation prices, would be ideal for Bitcoin to eventually continue with the uptrend.
SP500 – The primary stock index is currently in a macro range formation between 4160 and 3675. In order to have a clear macro bias on this asset class, a breakout above or below this sideways location is needed in the near future. Although the SP500 is currently above the 200-Day Moving Average, there is no clear trend between this macro range, and as we can see, the moving average is flat at the moment, indicating a clear sideways price action.
The financial markets have been quite dynamic lately, with several events and activities taking place. Here are the five main topics that occurred:
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