FXMAG.COM: On Thursday Bitcoin decreased noticeably, what would you address that decrease to?
Joe Jeffries (Eightcap): Yes, we noticed that drop; it really was the kick-off for the current pullback. If we look at the daily chart, we can see a decent patch of distribution from the 21st of Jan to the 8th of Feb. Yes price made several new highs, but overall it moved sideways. On Thursday, comments from Fed members looked to confuse the market a touch about what exactly is the Feds policy at present. This confusion, combined with a stagnating price, looked perfect for a round of profit-taking that went a touch far.
Since that point, risk markets have struggled for direction. We feel that they could be waiting for today's CPI data to give some guidance. We feel that if CPI data comes in hotter, this could hurt bitcoin further, and if it misses to the downside, we could see a new push higher.
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Another factor is the SEC and Paxos. This has had an influence this week on several coins, but for now, bitcoin looks to have mainly shrugged it off. But if it expands, you may see weakness spill over.
FXMAG.COM: Are you of the opinion UK retail sales is going to provide support to FTSE?
Joe Jeffries (Eightcap): Possibly not, this will depend on the UK CPI data this week, and for now, it's expected to come in at 10.3%, which is still a very high number. If retail sales come in strong, this could add more fuel to the inflation fire. But they are expected to come in at -0.2% and based on how things are going, they may even miss the downside. Anything right now that influences further rate rises could be a negative for the stock market.
Based on yesterday's rally and the current trend, the FTSE looks to be solid position ignoring local issues for now. The last GDP M/M came in at -0.5%. This week's US CPI and PPI data will be a factor to watch as it typically has a spillover effect on other major global exchanges.
