Welcome back to our weekly newsletter! We have things all ready and summarized for you🔥

As usual we have the rundown of What to know this Week 📅 for you to keep your eyes peeled on what will happen in the market!

• Maneuvering the Financial Maze Amid Government Shutdown Aversion🏢

• Spotlight on Grayscale's Pursuit to Establish Ether ETF📈

• Tesla and the Impact of Kellogg's Breakup🚗

What to know this Week? 📅

📊Market Performance

• S&P 500: 4,288.05 (-0.80%)

• DJI: 33,507.50 (-1.18%)

• Nasdaq-100: 14,715.24 (+0.02%)

• Russell 2000: 1,785.10 (+0.29%)

• Bitcoin: 28,380.60 (+7.68%)🥳

• Gold: $1,836.56 (-0.64%)

Government Shutdown: A Potential Gamechanger🏢

With Congressional leaders in a deadlock over last-minute spending bills, the probability of a government shutdown past September 30 is increasing.

A shutdown of this nature could put numerous government employees, ranging from air traffic controllers to defense personnel, on hold. They may be furloughed or obligated to work without remuneration.

Financial analysts foresee this shutdown potentially shattering US economic growth, lessening GDP by 0.2 percentage points for every week of the shutdown.

In the bigger picture, a shutdown of this magnitude could immensely impact Federal pay, which accounts for nearly 2% of the US GDP.

Crypto Response to Market Fluctuations🤔

Switching gears to the volatile world of crypto, it's important to gauge how the government shutdown might influence this nascent market. Historically, periods of economic instability have driven investors towards digital currencies as a speculative hedge.

Whether it's a repeat of the scenario or an unpredictable reverse play, remains to be seen.

Future Implications for the Financial Market📊

Federal agencies that contribute economic data such as the Bureau of Economic Analysis (BEA), Bureau of Labor Statistics (BLS), and U.S. Census Bureau will also be inhibited in the event of a shutdown.

This can potentially leave Federal Reserve policymakers without crucial data to inform and guide monetary policy decisions, adding to the uncertainty and turbulence in the financial markets.

Maneuvering the Financial Maze Amid Government Shutdown Aversion🏢

Late on Saturday, President Joe Biden approved a temporary extension, diverting the looming threat to our economy at least until the next funding deadline on November 17 - a week prior to Thanksgiving.

But what does this signify for our financial landscape, particularly the stock market and the burgeoning crypto sector?

Notably, this narrow escape from another government shutdown was accompanied by a wave of concern sweeping across Wall Street. The recurring back-and-forth concerning the debt ceiling is gradually gnawing away at investor confidence in the country's fiscal management.

Concerns about the US credit rating and the rather hefty national debt are becoming paramount amidst the constant political tug-of-war. This scenario might compel some to question the wisdom of investing in US assets, in favor of more stable and less-politically influenced options like digital currencies in the crypto market.

Simultaneously, we can't dismiss the imminent impact of two key events slated for the end of October - the Federal Reserve meeting and the renewed focus on inflation and interest rates. A potential rate hike could further escalate capital costs for debt-ridden companies, no doubt a looming concern for industries and investors alike.

Earnings season is also kicking off soon— already the outlook seems grim. Amidst declining consumer confidence and tightening wallets, companies are voicing concerns for the path forward.

Negative earnings per share (EPS) guidance from S&P 500 companies has outpaced the five-year average, hinting at a rocky financial road ahead.

Spotlight on Grayscale's Pursuit to Establish Ether ETF📈

Grayscale Investments, in collaboration with NYSE Arca, vies for the green light from the U.S. Securities and Exchange Commission (SEC) to transition their Ethereum Trust (ETHE) into a spot Ethereum Exchange-Traded Fund (ETF).

Currently recognized as the world's largest Ether investment product, the Grayscale Ethereum Trust hosts nearly $5 billion in assets under management. This endeavor to establish an ETF is a step towards fulfilling Grayscale’s unyielding commitment to providing investors with transparent, regulated access to cryptocurrencies through familiar product structures.

This pushed for product evolution follows in the wake of Grayscale's court victory with the SEC during the summer season, as the company concurrently waits for the agency's approval to convert their Bitcoin Trust into an ETF.

The advent of Ether ETFs signifies a leap forward in regulated investment options for digital assets. It offers the potential to increase liquidity, offer lower fees, and make Ethereum more accessible to traditional investors.

While we await the SEC's decision on this application, it's crucial to note that acceptance could result in substantial advancements for Ethereum at the regulatory level and potentially a bullish movement in the market.

Tesla and the Impact of Kellogg's Breakup🚗

Tesla, the world's most valuable automaker, reported a 7% decrease in vehicle deliveries for the third quarter, equating to 435,059 units. This was significantly short of the 454,100 units anticipated by Wall Street analysts.

Despite the concern, Tesla remains ambitious, steadfast in its target of delivering 1.8 million vehicles by the end of the year. Some market analysts believe that the factory upgrades could spur an impressive rebound for Tesla in the fourth quarter, posing an opportunity for investors to capitalize on.

As we transition to the world of traditional consumer goods, the Kellogg Company, renowned for its easy-to-recognize Frosted Flakes and Pringles, caught the spotlight with its decision to split its brand in two.

The Kellanova business will incorporate snack brands and plant-based foods, governed by the current Kellogg CEO, Steve Cahillane. Meanwhile, WK Kellogg Co will embody the traditional cereal business. The market reaction to this had been largely subdued, with investors waiting to see how the separate entities perform independently.

Examining these developments, they signify two key themes resonating in today's financial landscape— agility in market volatility and repositioning as a means for growth.

Both Tesla and Kellogg are showing remarkable resilience amidst the challenging market conditions and innovating their strategies smartly.

Forecasts

XAU/USD

As this week is a new month, first lets take a look at the monthly timeframe.

We can see that the candle for this month, October opens below the previous month's candle and price has started to move in a bearish direction. This signifies that gold price is still bearish and possibly is going to be for this week. However, we could also see that there is a significant support level at 1826, which could be a level where the price could possibly move towards to for this week and potentially make a bullish reversal upwards.

Now, looking into the weekly chart, we can also see that there is an area, which we can consider as a key level area, 1826 - 1810, whereby it has been a support previously which became a resistance and became another support as of now. Hence, we would expect the price to continue going downwards until the highlighted area which it will test.

In this case, there are two possibilities that could occur;

1. The price respects the key area as a support and will create a bullish reversal, before the price will continue to drop once again, or

2. The price breaks the key area and gold price will continue its bearish momentum downwards.

As we look into the daily timeframe, we can clearly observe that the key level area (1826 - 1810) has been a strong support in the past days and weeks as whenever the price touches, it respects and continues an upward trend, However, this time around we will have to watch and see how the gold price is going to react for this week, whether it will respect the current area or create a breakout to continue its bearish trend.

Bitcoin

Looking into Bitcoin, it is opposite however as the price of bitcoin opens above the previous month and it respected the support area that we highlighted in our previous forecasts.

As we can see in the chart above, now Bitcoin is set again to try and break the 30k mark as we expect the price to continue going bullish for this week and tries to break 30k. However, we have to take note that previously when this area broke and the price of bitcoin dropped, it created a significant resistance area around 30k - 32k where price has failed to break out of. Hence this is a significant area for buyers to look out for.

Onto the weekly timeframe, we can clearly see that the particular resistance zone and key level for bitcoin which is at 30k - 32k has been rejected multiple times in the past and continued to become a significant resistance. Hence, if this week the price were to respect and create another rejection on the area, we can expect the price to drop until the highlighted support area at 25k - 27k. Therefore, these are the two key areas to watch out as for this week.

Looking deeper in the daily timeframe, bitcoin price had respected the support zone whereby it there were a lot of buyers coming and created a big bullish candlestick which skyrocketed the price, and broke our previous resistance area which we highlighted in our previous forecast summary on Bitcoin. The full forecast can be observed here:

As the price continues to open above the previous day candle, which signifies that bitcoin price could be bullish again. We will have to wait and see how will the price reacts once it reaches the 30k mark again, stay tuned!

Key Upcoming Dates for this Week:

6th October 2023: Non-Farm Employment

This specific day and data could heavily influence both the price movement of Gold and Bitcoin. Hence, this fundamental factor is also crucial to how the prices would react when both Gold and Bitcoin are moving into our highlighted areas/zones. Make sure to keep an eye on the price on the day and stay tuned!

✨Bonus News✨

Disclaimer: This is not any kind of financial advise. This newsletter is solely informational; it does not constitute investment advice, a solicitation to buy or sell any securities, or a recommendation regarding how to manage your money. Be cautious and conduct your own study, please.