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A Macroeconomic Overview Using Chart Analysis

An in-depth look at various currencies and their charts as well as observations on energy commodity prices and how they’re affected by world events.



An in-depth look at various currencies and their charts as well as observations on energy commodity prices and how they’re affected by world events.

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In this episode of the “Fed Watch” podcast, we focus on important macro charts. We cover bitcoin’s chart, currencies like the dollar, the euro, the Hong Kong dollar, and gold as well as energy commodities. We didn’t have time to get to all the charts I prepared, because the live show has time constraints. I will attempt to get a second part out this week to cover the rest of my commodity charts, as well as supply chains and shipping costs. You can find the slide deck of charts here.

Other topics covered in today’s episode include President Joe Biden and Federal Reserve Chair Jerome Powell’s meeting yesterday, where I try to flesh out the importance of this Wall Street (Powell) versus globalists (Biden) showdown, and we get into a couple of things from Davos last week, particularly the Kissinger comments about Ukraine.

“Fed Watch” is the macro podcast for Bitcoiners. Each episode we discuss current events in macro from across the globe with an emphasis on central banks and currency matters.


The first currency we talk about is bitcoin. I discuss the recent pop in price on Memorial Day, and how it is simultaneous with a growing bullish divergence in the indicators.

However, I also go back in time to roughly one year ago, when there was a very similar situation. In June 2021, there was a bullish divergence in these two indicators and a breakout of a descending wedge. That move was a fake out, cut short by the Grayscale (GBTC) unlock wave in July. The current situation is similar on the chart, but not similar in the fundamentals. I just wanted to point out a previous example where a breakout like this week failed.

I make an effort to dislodge the “bitcoin rise equals dollar collapse” false narrative here. The dollar and bitcoin can rise together due to deflationary pressures pushing people to cash and away from counterparty risk.

Next up is the dollar. On the live stream, I show the following chart and discuss how we could be headed for a new higher range on the dollar. Perhaps we see another five to seven years of the dollar index (DXY) in a range of 100-110, kind of like how it jumped into the 90-100 range in 2015.

Dollar index chart with technical analysis (source)

For many who don’t like DXY because it is too narrow (euro 57.6%, yen 13.6% and pound 11.9%), I provide a chart of the trade-weighted dollar that includes 30-plus currencies including the Chinese yuan and Mexican peso.

In the below chart, we see the same consolidation beginning, but the high that the dollar achieved (excluding the COVID-19 crash highs) is a new high. I think this symbolizes a stair-step function higher for the trade-weighted dollar as well.

Trade-weighted dollar with 30-plus currencies (Source)

Remember, a strong dollar is the Fed failing and it also provides massive stress to the rest of the world’s economy.

The euro is nearly the inverse of the DXY. It also shows a recent breakout, but in this case downward. If the dollar rally is to consolidate before heading higher, the euro is going to consolidate before heading lower. One thing is for sure, the euro has broken its two-decade support trend line and it’s in big trouble of crashing much lower.

Chart of the euro versus the U.S. dollar exhibiting a downward breakout (source)

The next two charts are of the Hong Kong dollar versus the U.S. dollar. There is a peg in place that is plainly obvious on the first chart: It is a range between 7.75 and 7.85. Recently, the exchange rate has raced to the top of this pegged range, signaling massive dollar pressure in the Asian economies like China, Hong Kong, Taiwan, Japan and South Korea. The dollar squeeze rapidly started this year.

Monthly chart of the Hong Kong dollar versus the U.S. dollar (source)

The second chart of the Hong Kong dollar is a close up of the daily timeframe. The peg was defended successfully this time, by the authorities selling U.S. dollars and buying Hong Kong dollars, but the big question is do they have enough reserves to continue defending this peg for the rest of the year, like they did in 2018?

Daily chart of the Hong Kong dollar versus the U.S. dollar (source)

The Hong Kong authorities publish their reserve data, so we can get a clue to the severity of their predicament. At the end of April 2022, prior to the peg experiencing its greatest pressure, their reserves stood at $465.7 billion, $16 billion less than March.

The last currency we look at is partly a currency and partly a commodity: gold. It has been hard being a gold bug for the last 11 years. Currently, the gold price is below the 2011 high of $1,920, sitting at $1,840 at the time of recording. Imagine, holding gold for 11 years and losing money despite the narrative of money printing. Your choice at that point would be either abandon your faulty inflation dogma or go crazy on conspiracy theories. That sums up the gold community at this point, in my opinion.

Gold spot price April 2021 through May 2022 (source)

Energy Commodities

Moving onto commodities, on this episode, I only have a chance to cover two charts. The first is Brent crude (U.K. crude price in orange) and West Texas Intermediate (WTI) crude (U.S. crude price in blue). They often are extremely correlated, with a slight premium on European Brent.

I wanted to cover this chart today, because of the headlines about the sixth round of EU sanctions on Russian oil; it is an absolute joke. As you can see on the chart, the orange line actually drops on the day the theatrical sanctions were announced.

Brent crude and WTI crude oil prices (source)

My thesis for oil prices is as follows: Global demand is collapsing faster than oil supply. Recent elevated prices starting in March 2022 are due to the conflict in Russia and Ukraine causing market uncertainty. Oil is very overbought. The price of oil will begin to fall soon, lowering prices and consumer price index (CPI), and coinciding with a growth slowdown. This is not a stagflation scenario, it is a deflationary depression scenario after a temporary spike in prices.

Natural gas futures in Europe support my conclusion. They have been radically elevated, far above rational market fundamentals apart from sanctions on Russia. Russia has refused to be affected by successive rounds of sanctions, and the chart is telling us that these price levels are mainly due to people’s worries, not market fundamentals. Once those worries go away (when the end of the Ukraine situation becomes more clear), prices will adjust downward quickly.

European natural gas futures (source)

That does it for this week. Thanks to the readers and listeners. If you enjoy this content please subscribe, review and share!

This is a guest post by Ansel Lindner. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.

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SEC initiates legal action against FTX’s auditor

The SEC alleges that Prager Metis, an accounting firm engaged by bankrupt crypto exchange FTX in 2021, committed hundreds of violations related to auditor…



The SEC alleges that Prager Metis, an accounting firm engaged by bankrupt crypto exchange FTX in 2021, committed hundreds of violations related to auditor independence.

The United States Securities and Exchange Commission (SEC) has commenced legal proceedings against an accounting firm that had provided services to cryptocurrency exchange FTX before its bankruptcy declaration.

According to a Sept. 29 statement, the SEC alleged that accounting firm Prager Metis provided auditing services to its clients without maintaining the necessary independence as it continued to offer accounting services. This practice is prohibited under the auditor independence framework.

Extract from the SEC's September 29 statement. Source: SEC

To prevent conflicts of interest, accounting and audit tasks must be kept clearly separate. However, the SEC claims that these entwined activities spanned over a period of approximately three years:

“As alleged in our complaint, over a period of nearly three years, Prager’s audits, reviews, and exams fell short of these fundamental principles. Our complaint is an important reminder that auditor independence is crucial to investor protection.”

While the statement doesn't explicitly mention FTX or any other clients, it does emphasize that there were allegedly "hundreds" of auditor independence violations throughout the three-year period.

Furthermore, a previous court filing pointed out that the FTX Group engaged Metis to audit FTX US and FTX at some point in 2021. Subsequently, FTX declared bankruptcy in November 2022. 

The filing alleged that since former FTX CEO Sam Bankman-Fried publicly announced previous FTX audit results, Metis should have recognized that its work would be used by FTX to bolster public trust.

Related: FTX founder’s plea for temporary release should be denied, prosecution says

Concerns were previously reported about the material presented in FTX audit reports.

On Jan. 25, current FTX CEO John J. Ray III told a bankruptcy court that he had “substantial concerns as to the information presented in these audited financial statements.”

Furthermore, Senators Elizabeth Warren and Ron Wyden raised concerns about Prager Metis' impartiality. They argued that it functioned as an advocate for the crypto industry.

Meanwhile, a law firm that provided services to FTX has come under scrutiny in recent times.

In a Sept. 21 court filing, plaintiffs allege that U.S. based law firm, Fenwick & West, should be held partially liable for FTX's collapse because it reportedly exceeded the norm when it came to its service offerings to the exchange.

However, Fenwick & West asserts that it cannot be held accountable for a client's misconduct as long as its actions remain within the bounds of the client's representation.

Magazine: Blockchain detectives: Mt. Gox collapse saw birth of Chainalysis

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DOJ readies witnesses in Bankman-Fried trial, highlights FTX asset management

The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX.
The Department…



The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX.

The Department of Justice (DOJ) has confirmed its intention to summon former FTX clients, investors and staff as witnesses in the upcoming trial involving Sam Bankman-Fried, the former FTX CEO.

The DOJ submitted a letter motion in limine on Sept. 30 describing the witnesses it intends to call concerning FTX’s treatment of customer assets.

The testimonies intend to provide perspectives on the interactions between the accused and the witnesses. It also aims to get the witnesses’ understanding of Bankman-Fried’s remarks and conduct, particularly regarding FTX’s asset management. The DOJ intends to highlight the experiences of retail and institutional clients who entrusted substantial assets to FTX, believing that the platform would safeguard them securely.

Court filing in the United States District Court for the Southern District of New York. Source: CourtListener

Furthermore, a situation has emerged concerning one of the DOJ’s witnesses, “FTX Customer-1,” who resides in Ukraine. Given the ongoing conflict in Ukraine, traveling to the U.S. to provide testimony is associated with difficulties. The DOJ has suggested using video conferencing as a viable alternative. However, Bankman-Fried’s defense has not yet approved this proposal.

Nonetheless, the legal team representing Bankman-Fried, led by lawyer Mark Cohen, has voiced concerns about the jury questions put forth by the DOJ. According to Bankman-Fried’s defense, these interrogations insinuate guilt on Bankman-Fried’s part, potentially undermining the principle of “innocent until proven guilty.“

Additionally, the defense contends that these inquiries may not effectively uncover the jurors’ inherent biases, especially related to their encounters with cryptocurrencies. Moreover, specific questions could inadvertently guide the jury’s perspective instead of eliciting authentic insights, possibly compromising the trial’s impartiality.

Related: Sam Bankman-Fried’s lawyer challenges US gov’t proposed jury questions

With the jury selection scheduled to start on Oct. 3, closely followed by the trial, the spotlight is firmly on this high-stakes legal confrontation. This case underscores not only its immediate consequences but also underscores the vital importance of transparent communication and unbiased questioning in upholding the principles of justice.

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Vitalik Buterin voices concerns over DAOs approving ETH staking pool operators

The Ethereum co-founder proposes a solution that could lower the likelihood of any individual liquid staking provider growing to a point where it poses…



The Ethereum co-founder proposes a solution that could lower the likelihood of any individual liquid staking provider growing to a point where it poses a systemic risk.

Vitalik Buterin, the co-founder of Ethereum, has expressed worries regarding decentralized autonomous organizations (DAOs) exerting a monopoly over the selection of node operators in liquidity staking pools.

In a September 30 blog post, Buterin issues a warning that as staking pools adopt the DAO approach for governance over node operators—who are ultimately responsible for the pool's funds—it can expose them to potential risks from malicious actors.

“With the DAO approach, if a single such staking token dominates, that leads to a single, potentially attackable governance gadget controlling a very large portion of all Ethereum validators.”

Buterin highlights the liquid staking provider Lido (LDO) as an example with a DAO that validates node operators. However, he emphasizes that relying on just one layer of protection may prove insufficient:

“To the credit of protocols like Lido, they have implemented safeguards against this, but one layer of defense may not be enough,” he noted.

ETH staked by category chart. Source: Vitalik Buterin

Meanwhile, he explains that Rocket Pool offers the opportunity for anyone to become a node operator by placing an 8 Ether (ETH) deposit, which, at the time of this publication, is equivalent to approximately $13,406.

However, he notes this comes with its risks. "The Rocket Pool approach allows attackers to 51% attack the network, and force users to pay most of the costs," he stated.

On the other hand, Buterin highlights that having a mechanism to ascertain who can act as the underlying node operators is an inevitable necessity:

"It can't be unrestricted, because then attackers would join and amplify their attacks with users' funds."

Related: Ethereum is about to get crushed by liquid staking tokens

Buterin further outlines that a possible approach to address this issue involves encouraging ecosystem participants to utilize a variety of liquid staking providers. 

He clarifies this would decrease the likelihood of any one provider becoming excessively large and posing a systemic risk.

“In the longer term, however, this is an unstable equilibrium, and there is peril in relying too much on moralistic pressure to solve problems," he stated.

Magazine: Are DAOs overhyped and unworkable? Lessons from the front lines

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