Later today, Tuesday 12 March 2024, we get the US consumer inflation data.

Due at 1230 GMT, which is 0830 US Eastern time

(and, don’t forget, the US switched to daylight saving over the weekend so if you are trading the data be aware times may, likely have, changed in your local timezone:

***

OK, what to expect.
This
snapshot from the ForexLive economic data calendar, access
it here.

There was no SEC v Ripple case-related news to influence investor sentiments. However, Coinbase (COIN) retargeted the SEC after the SEC denied the rulemaking petition.

Coinbase Challenges SEC Denial of Rulemaking Petition

On Monday, Coinbase Chief Legal Officer Paul Grewal gave an update on the SEC rulemaking petition, saying,

“Today Coinbase filed our opening brief in the Third Circuit challenging the SEC’s denial of our rulemaking petition. Tl;dr: the SEC’s denial is arbitrary and capricious, an abuse of discretion, and a violation of the Administrative Procedures Act.”

Grewal added,

“If you go back and read the SEC’s perfunctory denial, you’ll be hard-pressed to find an actual reason for its inaction. This is despite the dozens of legitimate concerns we raised in our petition, including questioning the SEC’s authority over the digital asset space.”

In a series of posts on X (formerly Twitter), the Coinbase CLO also discussed how the SEC suddenly declared the right to oversee the US crypto space. Grewal noted the shift in stance vis-à-vis statutory authority, highlighting previous calls from the SEC for the authority to regulate the crypto market.

The issue of statutory authority sits at the heart of the Coinbase Motion to Dismiss (MTD).

In August, Coinbase filed a Motion to Dismiss the charges in the ongoing SEC v Coinbase (COIN) case. Coinbase argued the SEC lacked the statutory authority to regulate crypto exchanges.

If Judge Katherine Failla grants the Coinbase Motion to Dismiss, the ruling could force the SEC to end its campaign of regulation through enforcement. The outcome of the rulemaking petition may also present the SEC with challenges amidst increasing scrutiny of SEC activity in the courts.

XRP Price Action

In a recent development, David Schwartz, Chief Technology Officer of Ripple, addressed a challenging question regarding the nature of the XRP token and its potential for gradual appreciation. Schwartz’s remarks came amid discussions within the community regarding the token’s role in generating passive income, particularly in light of the activation of the XRP Ledger automated market maker (AMM).

Schwartz elucidated his perspective on XRP, characterizing it as a high-volatility asset similar to most cryptocurrencies. He emphasized the concept of gradual appreciation, likening it to the long-term behavior observed on Bitcoin over the past 12 years. While acknowledging the volatility inherent in digital assets, Schwartz underscored the potential of AMMs in harnessing this volatility to generate yield while mitigating risks associated with long-term price fluctuations.

Schwartz’s response addressed concerns raised about XRP’s perceived lack of gradual appreciation compared to other speculative projects. He positioned AMMs and staking as alternatives to long-term holding, offering avenues for yield generation while acknowledging the inherent volatility of digital assets. Contrary to notions of seeking higher returns through riskier ventures, Schwartz emphasized the role of AMMs in providing sustainable yield without promising unrealistically high returns.

Gradual appreciation

The discourse around XRP’s potential for passive income has intensified with the introduction of XRPL’s AMM, prompting misconceptions among some investors regarding the nature of DeFi products and associated risks. 

Schwartz’s clarification sought to educate stakeholders and temper unrealistic expectations, advocating for a more informed and realistic approach to engaging with XRPL’s decentralized features.

Schwartz addressed concerns from skeptics who favored projects with more speculative appeal, asserting that AMMs offer a viable alternative for those seeking to navigate the unpredictable landscape of digital assets without resorting to higher-risk ventures.

A larger-than-expected rise in US nonfarm payrolls in February suggests a robust demand environment. Softer US wage growth and a higher unemployment rate created market uncertainty before the report.

A hotter-than-expected CPI Report may force the Fed to delay an interest rate cut. A higher-for-longer rate path may impact disposable income. Downward trends in disposable income could curb consumer spending and dampen demand-driven inflation.

Short-Term Forecast

Near-term AUD/USD trends will hinge on the US CPI Report. Hotter-than-expected US inflation numbers could impact buyer demand for the AUD/USD. Delays to Fed rate cuts could tilt monetary policy divergence toward the US dollar.

AUD/USD Price Action

Daily Chart

The AUD/USD remained above the 50-day and 200-day EMAs, sending bullish price signals.

An Aussie dollar break above the $0.66162 resistance level would support a move toward the $0.67286 resistance level.

Australian economic data and the US CPI Report need consideration.

However, a drop below the 200-day and 50-day EMAs would give the bears a run at the $0.64900 support level.

A 14-period Daily RSI reading of 61.85 suggests an AUD/USD return to the $0.67 handle before entering overbought territory.

4-Hourly Chart

The AUD/USD sat above the 50-day and 200-day EMAs, affirming the bullish price signals.

A breakout from the $0.66162 resistance level would give the bull a run at the $0.67286 resistance level.

However, a break below the $0.66 handle would bring the 50-day and 200-day EMAs into play.

The 14-period 4-Hourly RSI at 67.93 indicates an AUD/USD move to the $0.67 handle before entering overbought territory.

Advance Stalls off Last Week’s High

Last week resistance was seen around the prior swing high of 24.61 from December 22. That price area was noted previously as a possible target as it was clearly resistance in the past. The question now is whether silver continues to progress its uptrend, or it retraces first? Certainly, the chance for a pullback has increased following last week’s price action.

Nevertheless, a decisive rally above last week’s high of 24.64 may see silver hit a higher target before a retracement. The next higher target is around 24.81. That is where the rising ABCD pattern (magenta) completes a 161.8% Fibonacci extension of the pattern. That is the third target from the pattern as each of the lower levels have already been exceeded to the upside.

Bigger Picture Bullish

In the bigger picture there is an initial higher target in silver up around 27.15. That is where a larger rising ABCD pattern completes (green). Given the recent impulse rally seen in silver this higher target looks reasonable. Therefore, traders will be watching for bullish reversal off retracement lows during weakness. A drop below last Friday’s low of 24.17 will signal a pullback.

The 8-Day MA is at 23.83 followed by the 38.2% Fibonacci retracement at 23.73. The last solid resistance level that was broken is down at 23.50 (B), right near the 50% retracement at 23.46. If a retracement does come before new trend highs these price levels are where support might be seen, that leads to a bullish reversal.

Finally, another mention about the monthly chart. A bullish reversal was triggered initially this month. The upside follow-through has indicated strong demand pointing to eventual higher prices.

For a look at all of today’s economic events, check out our economic calendar.

Bitcoin has shattered previous records by reaching a new all-time high of $71,092 on the Bitstamp exchange. 

This milestone comes as the cryptocurrency market continues to gain mainstream acceptance and attract significant investment from both retail and institutional investors following the approval of a slew of spot Bitcoin ETFs in January. 

Before reaching its new peak, Bitcoin recorded its highest weekly candle close ever at $69,062 on Bitstamp. 

In the meantime, the price of Ethereum, the second-largest cryptocurrency recently surged above the $4,000 level.    

More than $300 million worth of liquidations 

The recent price volatility has also led to significant market liquidations, with a total of $336.22 million liquidated In the past 24 hours alone, according to CoinGlass data. 

The majority of these liquidations were long positions, totaling $224.73 million. Short positions accounted for $111.49 million of the liquidations.

Over the last hour, the total market liquidations amounted to $39.68 million, demonstrating the high volatility in the cryptocurrency market. The majority of these liquidations were from short positions, totaling $37.65 million. Long position liquidations were significantly lower, at $2.03 million.

Over the past four hours, OKX led the exchanges in liquidations, with $19.95 million. Of this, $2.99 million were long positions, and a notable $16.96 million were short positions, comprising 85.03% of its total liquidations. Bitmex followed, with total liquidations amounting to $8.71 million, all of which were short positions. Lastly, Binance saw liquidations totaling $6.74 million, with $2.12 million in long positions and $4.63 million in short positions.