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Asian Market Update – Friday: Coins point higher after turmoil on Thursday following platform closure in China

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Bitcoin bull market

The Big Question: Will cryptocurrencies be able to offset recent losses?

Prices of cryptocurrencies climbed overnight during the Asian trading session, trimming heavy losses from the previous day as investors appears to be shrugging off the impact of the closure of a major trading platform in China.

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Bitcoin prices gained 6.3 percent to $3,431 before midday. That’s a remarkable comeback for the digital currency, which dropped as much as 10 percent in the previous day to a low of around $3,227, the lowest level since mid-August.

Bitcoin has now been on a steep downtrend for nearly two straight weeks, though there were slight recoveries along the way. In particular, since last Friday, the digital currency has been in decline until early this morning, losing more than $1,380 during the week.

Ethereum also tracked bitcoin prices overnight, surging 7.06 percent to $238.27. Ethereum also dropped near the $220 level in early morning trading, the lowest since August 2. Etherum has also been on a downward move for two weeks, dropping from around $390 down to near the $220 level.

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The last two weeks has not been good for digital currencies, which faced scores of attacks from not just governments, but prominent figures such as the CEO of JPMorgan Chase.

Late on Thursday, Bitcoin China said it has stopped registering new accounts with the platform and will suspend all trading activities at the end of September.

The move confirmed earlier reports of Chinese officials mulling to shut down commercial trading of virtual currencies.

Though other main platforms such as huobi.com remain active, they will likely follow Bitcoin China, as Chinese regulators are determined to crack down on what they consider a risky industry. China has already banned ICO’s.

Apart from China, the Russian government is reportedly also mulling measures to regulate digital currency trading.

This week, JPMorgan Chase CEO Jamie Dimon also made headlines after describing bitcoin as a “fraud.” He told CNBC that “[bitcoin] is just not a real thing, eventually it will be closed.” But Dimon said he is not suggesting investors to go short bitcoin.

Main Market Movers – Mid-day Asian Trading Session

Indexes Value at Midday Daily Change
Japan-Nikkei Stock Average 225 19,826.84 0.1%
China-Shanghai Composite Index 3,362.06 -0.28%
Hong Kong –Hang Seng 27,639.65 -0.50%
Australia-ASX 200 5,695.30 -0.76%
South Korea-KOSPI 2,370.01 -0.32%

Again, North Korea has launched another missile test this morning, putting major equity markets in a risk-off mode in early morning trading before they later regained some ground.

In Japan, the Nikkei 225 started off lower, but later bounced back. Before midday, the benchmark index was up 0.1 percent to 19,826.84.

In Greater China, stocks were lower mainly due to weaker-than-expected economic data on Thursday. The Shanghai Composite Index skidded 0.28 percent to 3,362 before midday. In Hong Kong, the Hang Seng Index was down 0.50 percent 27,639.

In South Korea, the KOSPI index lost 0.32 percent to 2,370 around midday.

Down under, the ASX 200 dropped 0.76 percent to 5,695.

Though the majority of the indexes were down, most analysts believe investors in Asia Pacific are used to North Korean missile launches by now.

In response to a fresh round of UN sanctions, the rogue regime in North Korea fired off a missile over Japan, landing in the Pacific Ocean. Friday’s launch followed repeated threats to hit the US and Japan.

Currencies

The Japanese yen gained a slight 0.06 percent against the US dollar at Midday on Friday. The USD/JPY rate was at 110.14.

The Chinese yuan strengthened 0.05 percent to 6.5502 per dollar, after a four-day depreciating trend against the greenback. The yuan has been on a downtrend since Monday following changes in foreign exchange regulations, allowing the yuan to float more freely.

The Australian dollar lost 0.06 percent against the US dollar. The Australian dollar was trading at 1.2507 before midday.

Commodities

WTI Oil was down 0.02 percent to $49.71 per barrel.

Brent Crude lost 0.02 percent to $55.28 per barrel.

Gold was also up 0.18 percent to $1,330 an ounce

Business News across Asia

In China, the world’s second largest economy showed surprising signs of cooling down, after industrial output, retail sales and fixed-asset investment all slowed in August, prompting concerns that the Chinese economy might be cooling after positive signs earlier this year.

Take away: While the cooling signs are alarming, most Chinese analysts believe that the set of data were mainly due to controls on production and environmental control ahead of a big Communist Party meeting set for mid-October, and that fundamentals of the Chinese economy remain solid.

In India, a planned IPO of a matchmaking website has triggered wide-spread enthusiasm from investors. The IPO of Matrimony.com of up to $78 million was reportedly subscribed 4.4 times so far.

Take Away: Analysts believe this is a tip of the iceberg in India’s booming IPO market. More new online services could follow suit and announce IPOs.

Featured image from Pixabay.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.2 stars on average, based on 20 rated postsFredrik Vold is an entrepreneur, financial writer, and technical analysis enthusiast. He has been working and traveling in Asia for several years, and is currently based out of Beijing, China. He mainly follows the stock and forex markets, and is always looking for the next great alternative investment opportunity.




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  1. Chris G

    September 15, 2017 at 4:11 pm

    look at that price turn-around in crypto … boom …

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Analysis

Daily Analysis: No Questions Answered

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Thursday Market Recap

Asset Current Value Daily Change
S&P 500 2718 0.97%
DAX 12,468 0.31%
WTI Crude Oil 62.61 2.02%
GOLD 1332.00 0.52%
Bitcoin 9780 -8.00%
EUR/USD 1.2324 0.26%

It was a strange day indeed in equity markets, with mixed signals popping up across the board after yesterday’s crazy quasi-FED day. An ugly overnight session, followed by a strong pre-market rally, an early-day pump, and a late-day dump. That is the summary of the day, but under the surface, there is a real struggle between market forces, with still an edge for bears in the battle for control.

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NASDAQ 100 Futures, 4-Hour Chart Analysis

It seems that the Nasdaq is still the key, as the relative strength of the tech benchmark is the most reliable gauge of the market direction, at least regarding the intraday trends. That said, at the end of the day, the Nasdaq closed in the red 4 times in a row, at least as far as the normal trading day is concerned, and still, the major indices are trading not far off last Friday’s top, despite the downward drift.

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Forex Markets and Commodities

Adding to the confusion, the Dollar corrected lower after a positive period, and with Treasury yields trading all over the place, investors were left scratching their heads yet again. The Japanese Yen was the clear winner of the day among currencies, as the primary safe-haven got bid heavily during the Asian session, and it remained throughout the up-and-downs of the day, despite the strong bounce in stocks and risk-on currencies.

USD/JPY, 4-Hour Chart Analysis

The EUR/USD pair had a very active and volatile session, but the common currency remained above the lows from two weeks ago, while also halting below yesterday’s highs, so all-in-all, no technical conclusion to draw. As in stocks, the next clear directional day will be crucial, as the tug of war is getting tenser and tenser.

EUR/USD, 4-Hour Chart Analysis

The Canadian Dollar plummeted during the day, thanks to the dismal Retail Sales figures, but it finished well off its lows, boosted by the stock recovery and the jump in the price of crude oil. The Black Gold was pushed higher by the surprisingly bullish US inventory data, and the WTI contract closed back above $62.50 per barrel.

USD/CAD, 4-Hour Chart Analysis

Gold continued to follow the Euro, finishing the day slightly higher, but the precious metal showed notable relative strength during the Asian session, and that could be the precursor of a move to new rally highs, should the bearish scenario play out in equities.

Cryptocurrencies

The segment had another bearish session, and the bleeding continued after the US session, with BTC leading the way lower this time around after a long period of relative strength. A crucial test might be ahead of the most valuable coin, as the $9000-$9200 support zone would be a perfect target for the current correction, to keep the uptrend going. That said, that zone is still almost 50% above the prior low, leaving plenty of room for the coin to bottom out.

BTC/USDT, 4-Hour Chart Analysis

With all of the major altcoins also sporting significant losses, bulls would like to see more of the early relative strength that some coins have been showing, to establish a leadership that can guide the segment out of the plunge. For now, the crash lows are way below the current levels, and the bullish long-term scenario remains intact.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

Pre-Market: Bulls Try to Fight Back after Ugly Overnight Session

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Following the steep late-day downturn on Wednesday, which followed the not-to-hawkish FED meeting minutes, Asian markets and US equity futures continued lower with a vengeance. The very active overnight trading is another sign of the regime change in traditional financial markets that we have been monitoring for the last two weeks, ever since the “Black Monday of 2018”.

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Dow Futures, 4-Hour Chart Analysis

EUR/USD Changing Behavior

The European session brought about an oversold bounce that stabilized markets from stocks to currencies. The EUR/USD pair that has started acting “normally” considering its relationship with US Treasury yields lately, is headed south once again, trading only 0.5% above its recent correction lows after clearly breaking below the rising trendline.

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EUR/USD, 4-Hour Chart Analysis

The bull-trap that we identified a few days ago was the start of the current leg lower, and if the regime change will be persistent, the most traded forex pair could be back to the role of the “risk-on/risk-off” indicator that has been the privilege of commodity currencies in the last couple of weeks.

USD/JPY, 4-Hour Chart Analysis

The Japanese Yen is showing notable strength after its overbought dip, and the primary safe-haven currency could be in for more gains, should the risk-selloff continue. The Yen also gained ground on the common European currency, following the dovish ECB meeting accounts and the misses in the German IFO business climate indicator and the British GDP, which all question the European growth-monetary tightening narrative.

Canadian Dollar in for a Wild Ride

USD/CAD, 4-Hour Chart Analysis

With the Canadian retail sales report and the US crude oil inventory data coming out soon, forex traders should expect sizeable moves in the recently weak currency, while the USD should also be very active during the US stock market session.

All eyes are on Treasury yields again, with the slight correction today helping the bounce in stocks and other risk assets. The Nasdaq could be the motor of a stronger rally on Wall Street, but we wouldn’t bet the house on that, as the short-term technical setup remains bearish, and a re-test of the correction lows is still the most likely scenario for the coming weeks.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Market Overview

Play that Funky Market

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There’s only one way to explain what’s happening in the markets right now.

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It’s FUNK!

@MatiGreenspan
eToro, Senior Market Analyst

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Today’s Highlights

  • More Market Funk
  • No way but Right?
  • More Crypto Vol

Please note: All data, figures & graphs are valid as of February 22nd. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets Funk

Everything was going fine on Wall Street, they came back from lunch in a buying mood, but somehow things started to turn sour. By about an hour before the close things started to get downright ugly and by now we’re more than 500 points off the peak of that yellow circle and we’re now 3.82% from the all-time high.

Once again, the movement began in the bond markets, with the yields on the 10 Year spiking to a new high of 2.94% by the end of the day.

And of course, volatility can be seen with the VXX shooting up into the close.

Italian Splinters

It’s been five days since Italy stopped publishing opinion polls ahead of the national elections on March 4th in order to stop them having an influence on polling day itself.

That said, as we learned in Brexit and the Trump elections, polls can’t always predict what’s going to happen and in Italy, even less so. And this one is set to be even more interesting than usual.

Nevertheless, some analysts have come to the conclusion that the only party with an actual shot of winning an outright majority is Forza Italia, led by Silvio (I can’t believe I’m even writing this) Berlusconi.

This is still anyone’s game though, and even though there are 945 seats across two Houses of Parliament, alliances are so fractured that candidates are now battling for every single voter.

For the markets it’s still not clear what the effects might be, but as Europe’s 4th largest economy, and with the EU’s 1st largest economy still in a political deadlock, I’m looking squarely at the Euro.

In this chart, we can see the effect that a decisive election had on the EURUSD on April 23rd (yellow circle). Notice the large gap up that seemingly took the market from flat to flying in a single weekend when it became clear that Marine Le Pen had no chance of victory.

Crypto Volatility Continues

When Wal-mart’s stock dropped 10% on Tuesday it was a really big deal but when Bitcoin dropped an equal percentage on Wednesday, somehow it just doesn’t seem all that significant.

On that thought, here’s a meme I made yesterday. 🙂

That’s just the level of volatility that we’ve come to expect from this market. So please be aware that when I say cryptos are volatile, what I mean is they’re extremely volatile.

One thing that I keep noticing in the crypto-market is that when things are going up, we can expect to see different levels of returns in different coins and general divergence. However, when things are going down the correlation gets stronger and everything falls together.
You should be able to see that in this chart pretty clearly…

As always, let me know if you have any questions or if you need anything further.

Have a groovy day!!

This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation. The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro. Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose. Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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