Russell Shor

Silvergate Bank will wind down its operation and liquidate. The liquidation includes the full repayment of deposits. Last week it said it would delay the filing of its annual report as it was assessing its ability to “continue as a going concern.”

The 2s-10s yield curve has been inverted for 9-months and is currently at -107 bps. The last time the yield curve was this far into inversion territory was in the early 1980s. An inverted yield curve often forewarns of an economic recession, as it suggests that investors expect short-term interest rates to fall, and normalise the curve. This can be a signal that the economy is headed for a downturn.

A break below will be because of greenback strength as opposed to a deterioration in the euro. Rather, the ECB continues with its own hawkish rhetoric and the ECB will hike by 50 bps next Thursday. However, it’s all about greenback strength at the moment and data out of the United States

The dollar jumped on a hawkish testimony from Fed Chair Jerome Powell before the Senate Banking Committee. He said that “inflationary pressures are running higher than expected at the time of our previous Federal Open Market Committee” and that recent economic data is “stronger than expected.” This is in contrast to his comments in February when he spoke of the disinflationary process.

The hourly stochastic has made its way to its upper quintile. The longer it maintains this position, the better the chances of further USDOLLAR price appreciation.

The current housing starts index is weak. It is below its 3-month moving average and heading down. Its RSI is on the bearish side of 50.

FXCM senior market specialist, Russ and Nik, discuss several key events for the week. Fed Chair Powell will testify in front of the Senate (Tues) and House (Wed). The market will be eager to hear any hints on rate hikes or the terminal rate. This Friday the jobs data for February will be released. Last data point was a big surprise higher and the market will look here in anticipation.…

FXCM’s USDOLLAR basket’s daily chart continues to trade in its bullish channel between the upper blue and red bands. The hourly chart is also showing positive developments. Its trend following EMAs and momentum based- stochastic have crossed. Development of angle and separation by the EMAs and movement by the stochastic into the 80+ area (blue arrow) will be a bullish development.

China has set a slower-than expected GDP growth target of 5% for this year. The target for last year was 5.5%, but actual GDP growth was only 3%, the second slowest since the 1970s, the Associated Press reported.

The EURUSD daily candlestick chart is positioned in its weak channel, between the lower blue and red bands. It was pushed back into the soft area after moving out.

Bitcoin dropped by over $1,200 in an hour, before finding support at the S3 pivot