The Spark Alts Needed?

This week the Ripple (XRP) ruling that has deemed XRP not a security has sent massive waves across the market. While not obvious in the price of Bitcoin, the hammered altcoin market has seen quite a relief given the FUD that has recently surrounded the space. Investors are optimistic given the news, in the face of the recent SEC filings that have taken aim at the altcoin market insinuating that they all in fact should be treated as securities.
Only time will tell how this plays out, but things are looking optimistic.

U.S. markets also continue to surge as the recent data provided more evidence that inflation pressures were subsiding. More about this to come.

Cryptocurrency
Ripple Labs, the company behind the creation of the crypto currency Ripple (XRP) has had its long-standing dispute with the Securities and Exchange Commission come to an abrupt ending after almost three years.
On July 13 Judge Analisa Torres ruled partially in the favor of Ripple Labs finding that the XRP token is not a security in regards to its sales on digital asset exchanges. This was all investors needed, as the price of the XRP token shot up almost 100% in a matter of hours.
Riding the news, Ethereum and the altcoin market also saw sizeable gains across a number of altcoins. Solana rose 45% as the popular layer-1 solution hit $30, a feat it hasn’t accomplished since November last year. 
With the SEC filing charges aimed directly at Coinbase and Binance, Gay Gensler (SEC chairman) believes most crypto currencies are securities and as such, current law gives the SEC the power to regulate and govern them. It’s easy to see why investors were so quick to jump back into the alt market given the XRP ruling and the perceived positive implications it can have for other cryptocurrencies in the future. This has yet to be proven however. It is also unclear whether or not the SEC will appeal the decision.

In other news involving the SEC, the commission has just accepted Blackrocks application for a spot Bitcoin exchange-traded fund (ETF). This announcement is only a precursor to the final decision that will ultimately decide whether or not a Bitcoin ETF will go ahead, but purely the fact the SEC is going to review the application is great news for the space.
On Friday July 14th, the SEC regulator announced that it was also looking at several other Bitcoin funds including that of WisdomTree, Invesco Galaxy and Vance to name a few.
With so many companies in the race to have their name tied to the first Bitcoin ETF, this can only be seen as a positive development for the industry.

BTC/USD
1-Day Timeframe
Bitcoin for now 24 days straight has been caught in a tight consolidation rage of  ~ $1500 between 30k and 31.5k.
Bulls believed they were in full control late last week when we saw a 4% run to take out the previous highs in the range of 31.5k and talks of 40k onwards were ripe. Alas, the move was short lived, being fully reversed only 12 hours later but a 5% move to the downside to take us to the range lows at 30k.
Since that point, we’ve have not moved, seeing small moves over the weekend while volume dropped away.
Decision time is likely for bitcoin in the next week or two. The longer this range continues to go on the more likely it is for Bitcoin to pick a direction.
RSI has now triple diverged across the closes of the highs. It’s hard to tell whether or not the divergence has played out with that violet drop after the highs were taken but just note they are generally very strong indicators of a trend change when occurring.

The right way to play this for the entire range would be to be bullish at the range lows (we’re there now) and to hop out/short at the range highs.
Until we pick a direction that’s my advice. Just be weary, Bitcoin is a ticking timebomb and you don’t want to be caught on the wrong side of the market.
As discussed last week. When the move comes, it’s likely to be so swift you wont get an opportunity to position. So have your stop buys/ stop losses / shorts set and wait for price to come to you.ETH/USD
1-Day Timeframe
ETH was the star of the show last week, putting in the work and carrying alts with it. 7% on the day taking out all the recent highs from as way back as the start of May eclipsing the $2000 mark.
Just like Bitcoin however, the next day we saw a complete reverse on price but not to the same magnitude. While Bitcoin’s candle completely eclipsed the candle before it, Ethereum’s dip did not.
This lack of reversal has seen ETH gain back some dominance from BTC and give back to the altcoin market.
Structurally, you can see ETH putting in higher highs and higher lows without creating any divergences. This gives light to the fact altcoins have been seeing some relief over the last couple of days. As long as ETH retains the last higher low at $1867, I still think we’re golden here! And this means the daylight for alts to continue.
Legacy
Stocks ended last week with a small decline of 0.6% over the SPX and a bigger 0.9% for the NAS. However, both have seen a sizeable rally since last week’s letter eclipsing the highs and ending a 1.5% rally for the SPX and again bigger 2.8% for the NAS at end of trade Friday. This is likely contributed by the fact the U.S. data provided more evidence that inflation pressures were easing. Wednesday’s CPI report U.S consumer prices registered the smallest annual increase in over two years, which supports the thesis that the Federal Reserve will stop hiking rates after the predicted rate rise of 25bps at the July 26 meeting.
"PPI is another confirmation this week that inflation continues to trend in the right direction even as we see better overall labor market and consumer data. That is a good sign," said Mona Mahajan, senior investment strategist at Edward Jones.

Source: Reuters

Chip makers such as Nvidia also jumped to a record high during the week as the Philadelphia semiconductor index (SOX) rose more than 2% confirming that the run is far but over.

In the coming weeks, the focus will shift to the second-quarter US earnings reports. JP Morgan published strong financial results that beat many analysts estimates. The company benefitted from rising interest rates and additional inflows following the acquisition of First Republic Bank. JP Morgan’s revenue jumped to more than $42.4 billion in the second quarter, up from the previous quarter.
Anticipation surrounding other major reports being released will surely cause interesting movements across the markets.  Stay tuned.

S&P 500
1-Day Timeframe

Mentioned last week, the daily divergence forming has been well and truly blown by.
In very strong up trending markets this can be the case where divergences form but don’t eventuate solely due to the fact the RSI can hang at overbought areas for quite a while. Remember, you’re trading against the trend when looking for points for corrections. This is life on hard mode.
We’re now headed to the 0.786 Fibonacci level at 4534 and into some very hairy levels. A great TP spot for people already positioned.
If we start trading below the recent highs at 4450, this would give me cause for concern. Until then, Continuation is expected.

US Dollar
1-Day Timeframe

On the back of the news last week of the U.S. job market and the expectations of higher interest rates from the fed, the DXY has seen a monumental decline, seeing the biggest losses in a week since back in November of last year. A near 4% decline. Now losing monthly support at 101.3, the dollar has lost its market structure with the dip below the recent low at 102.1.
Support lies around the 97.7-99.21 box. A likely area to land.
Not looking great for the US dollar at this stage.

Weekly schedule
Other Markets
China has missed its target for GDP growth for the second quarter by as much as 1% by recording a 6.3% GDP print for the second quarter. Analysts polled by Reuters had predicted a 7.3% increase in the second quarter.
National Bureau of Statistics spokesperson Fu Linghui noted China faces a complex geopolitical and economic international environment. He also said China can still achieve its full-year growth target. Beijing in March set a goal of around 5% growth for 2023.
In other news, interestingly enough, China’s youth unemployment has now risen to 21.3% for people between the ages of 16-24. Which sets a new record.

Written by: Jared Stevenson