The Bitcoin and crypto market is bracing for a whirlwind week ahead, with pivotal events that could significantly influence trading and regulatory landscapes. From Binance’s legal tussle with the SEC to crucial economic data releases, here are the top five events that market participants should keep an eye on.
#1 Binance Responds To SEC’s Orders (Monday)
Today, Binance.US, the American arm of the global crypto exchange, is slated to reply to the US Securities and Exchange Commission’s (SEC) motion to file confidential documents and objection to a protective order. The case, which has significant implications for the crypto sector, has experts like pro-XRP attorney John E. Deaton speculating on the nature of these sealed documents.
“As I said on Crypto Law and other channels, it will be interesting to see whether Binance objects to the SEC’s Motion to Seal certain documents (over 30 plus exhibits). Binance’s response could be insightful regarding the nature of the documents,” remarked Deaton yesterday.
Earlier this month, legal representatives for the SEC, Binance.US, BAM Trading Services, and BAM Management US Holdings jointly submitted a stipulation and proposed order. This filing pertains to Binance.US’s request for a protective order against the SEC’s demands, which they argue exceed a previously established consent order.
Binance.US is seeking to halt depositions of its CEO and CFO and to dismiss certain unrelated demands from the SEC. Amidst these legal maneuvers, Binance has asserted that it has provided ample evidence to the SEC about the security of its customer assets. However, they criticize the SEC’s demands as being “stunningly overbroad and unduly burdensome.”
#2 Gensler Testifies Before Senate Banking Committee (Tuesday)
At 10:00 am ET on September 12th, SEC Chair Gary Gensler is scheduled to testify before the Senate Banking Committee. This is the first of two testimonies he will give to the US Congress this month. The SEC’s position against a spot Bitcoin ETF, especially in light of Grayscale’s recent legal victory, is expected to be a focal point.
Additionally, broader regulatory questions may emerge, particularly after the SEC’s loss against Ripple Labs. Senator Bill Hagerty has expressed interest in probing the relationship between the securities regulator and the digital assets sector.
#3 FTX Seeks Liquidation Approval (Wednesday)
FTX, the now-bankrupt crypto exchange, is set to appear in Delaware Bankruptcy Court on September 13th. They will be seeking approval to liquidate $3.4 billion in Bitcoin and other crypto assets. Market participants are wary of the potential selling pressure this might exert on the market.
FTX’s proposal from late August suggests appointing Galaxy Digital, led by Mike Novogratz, to oversee the sale and management of these assets. According to the plan, FTX seeks allowance to sell up to $100 million worth of tokens per week, and could be increased to $200 million on an individual token basis. The court will review these propositions on September 13th.
#4 US CPI Data Release (Wednesday)
The United States is gearing up for a significant economic data release this week, with the Consumer Price Index (CPI) for August taking center stage. The YoY inflation rate (release at 8:30 am ET) is anticipated to rise from 3.2% to 3.6%, while the Core Inflation Rate YoY is projected to recede from 4.7% to 4.3%. These figures are particularly noteworthy given the ongoing discussions about inflationary pressures and their potential impact on monetary policy.
The Cleveland Fed’s recent adjustments to their projections have further intensified the spotlight on the CPI data. Their updated forecast suggests a YoY of 3.82% for August, a notable uptick from previous estimates. Furthermore, their projection for September’s CPI stands at 0.45%, pushing the YoY to an even more significant 3.91%. A primary driver behind these adjustments has been the recent surge in gasoline prices, which often plays a pivotal role in influencing consumer price movements.
Jim Bianco, a renowned analyst from Bianco Research LLC, weighed in on the importance of the upcoming data. He stated via Twitter, “if YoY CPI is pushing 4.0% by September (reported in mid-October), I cannot see how the Fed pauses from raising rates, and any 2024 rate cut is out of the question.”
Bianco’s comments underscore the gravity of the situation. With the Federal Reserve’s policy meeting scheduled for September 19-20, the CPI data will undoubtedly play a crucial role in shaping discussions. The US central bank, which has consistently emphasized its “data-dependent” approach, is widely expected to maintain borrowing costs within the range of 5.25% to 5.50%. However, any unexpected spikes in the CPI could potentially sway the narrative.
#5 US PPI Release (Thursday)
The Producer Price Index (PPI) is another key metric to watch, as it often precedes the CPI. PPI data will be released on Thursday at 8:30 am ET. The forecast for August stands at 1.2%, up from July’s 0.8% year-over-year.
Extra: BTC Price Double Top Confirmation?
Yesterday’s weekly close of the Bitcoin price below the $26,000 mark has sparked concerns among market analysts. This move is seen as the first step towards confirming a double top formation. Turn $26,000 into new resistance and BTC could tumble towards the $22,000 region.
However, it’s important to note that BTC could find earlier support at the neckline of the inverse head and shoulders pattern on Bitcoin’s weekly chart which played out in mid-March this year. A successful retest of the neckline, around $24,200, might indicate the bottom of Bitcoin’s current correction.
At press time, Bitcoin traded at $25,692.
Featured image from Ran Berkovich / Unsplash, chart from TradingView.com