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Asian Market Update – Monday: Bitcoin Steady Following New All-Time High on Sunday

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Bitcoin profits

The Big Question: What’s driving the recent bitcoin rally?

Bitcoin on Sunday reached yet another milestone, trading above $6,000 again for the second time, and marking a new all-time high of $6,345, as reported by CryptoCoinsNews.com on Monday. Bitcoin crushed its previous all-time high of $6,183 after just eight days of trading.

The new all-time high in bitcoin has again pushed the total bitcoin market capitalization above the $100 billion threshold.

Although it is still unclear what exactly led to the most recent run-up, most analysts agree that it is likely due to increased mainstream media attention and ever-growing interest from the general public.

Bitcoin’s younger sibling litecoin is also trading steadily following bitcoin’s bull-run. As of midday in Asia, litecoin was trading at $56.62, up 0.05 percent for the day.

Ethereum also posted a small gain for the day, tacking on 1.35 percent to $307 in the early hours of the Asian trading session Monday.

Main Market Movers – Mid-day Asian Trading Session

Indexes Value at Midday Daily Change
Japan- Nikkei 225 21,992 -0.07%
China-Shanghai Composite Index 3,393 -0.68%
South Korea-KOSPI 2,501 0.18%
Hong Kong –Hang Seng 28,467 0.12%
Australia-ASX 200 5,919 0.27%

Stocks

Major stock indexes in Asia were in a mixed mode on Monday morning, with China and Japan slightly down and Korea, Hong Kong and Australia slightly up.

Analysts believe that the continuation of easy monetary policy in the EU and Japan, combined with strong corporate earnings, will continue to propel stock prices globally to higher levels.

Tech shares in South Korea and Taiwan were also propelled higher in the Asian trading session Monday, after Apple reportedly said pre-orders for the iPhone X were “off the charts,” according to a Reuters report.

In Japan, the Nikkei 225 lost a slight 0.07 percent to 21,992 after midday in Tokyo trading.

In China, the Shanghai Composite Index also lost 0.68 percent to 3,393, while shares in Hong Kong’s Hang Seng Index edged up 0.12 percent to 28,467.

South Korea’s Kospi Index rose 0.18 percent after midday, trading just above the 2,500 mark.

Down under, the ASX 200 Index gained 0.27 percent on Monday, trading at 5.919 at the end of the trading day in Australia.

Currencies

The Japanese yen on Monday gained 0.08 percent against the US dollar, trading at 113.6 per dollar.

The Chinese yuan gained a slight 0.07 percent against the US dollar, to 6.6444 per dollar.

The Australian dollar was nearly unchanged during Australian trading on Monday, edging up a slight 0.03 percent on the dollar, to change hands at 1.3027 per dollar.

The euro also edged up slightly on the dollar in Asian trading on Monday, trading up by 0.11 percent. The small gain comes after sharp losses for the euro on Thursday and Friday following unrest in Spain’s Catalonia region as well as continued easy monetary policy from the European Central Bank. It is unclear what impact the Catalonia situation will have on the euro, but several analysts believe that the worries are “overblown” and that this should not be seen as a near-term risk for the euro.

Commodities

WTI Oil was down 0.39 percent to $53.90 per barrel on Monday morning, after strong gains in the price of oil on Friday, when WTI oil broke through its previous swing high from September.

Brent Crude made a similar move before the weekend, while consolidating down by 0.36 percent to $60.36 per barrel Monday morning.

Gold on Monday morning lost 0.27 percent to $1,270 an ounce.

Business News across Asia

In China, Facebook CEO Mark Zuckerberg is again visiting Beijing, meeting with students at the prestigious Tsinghua University. Analysts are now speculating that Facebook could be getting closer to finally opening their service for Mainland Chinese users. According to one analyst, there is “a realistic opportunity” for Facebook to be allowed to enter the Chinese market in 2018. Facebook has been blocked in China for many years already, and most recently Facebook-owned messaging app WhatsApp was also blocked for users on the Mainland.

Take-away: It is generally believed that the Chinese leadership will be willing to open up more and loosen up on media censorship now that President Xi is in his second term. Only time will tell if this is indeed the case, but 2018 may prove to become a golden year for Facebook.

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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4.3 stars on average, based on 37 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 closely follows stocks, forex and cryptocurrencies, and is always looking for the next great alternative investment opportunity.




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Market Overview

Bankers & Politicians

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Hi Everyone,

Today is the day. Out of all the meetups, conferences, and hearings that we’ve seen regarding the future of money over the last year, imho none are as critical as the decision expected from India’s supreme court today.

Like several other places in the world, the Indian government is now working hard to form their policy regarding bitcoin and cryptocurrencies but the banking sector has made it clear that they will do everything in their power to halt this.

When Prime Minister Modi made the move to remove 86% of the paper money in India on November 8th, 2016 he inadvertently handed a big win to the banking system and it seems they’re willing to do everything in their power to maintain the status quo.

The crypto ban imposed by the Reserve Bank of India earlier this month is a clear example of this effort. Let’s hope that the judicial system sees through this today and strikes down this policy, doing what is right for the wider public now and for future generations.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Central Bank Independence
  • Stock Markets are Mixed
  • Divergence in Crypto

Please note: All data, figures & graphs are valid as of July 20th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

It was funny, but yesterday I was teaching a group of new eToro representatives about central banks and happened to use an example of what’s happening in the news.

The point I was making is that central banks are officially disconnected from politics but that politics do end up influencing their actions and vice versa.

In his testimony on Wednesday, Fed Chair Jerome Powell did his best not to take sides on the current trade dispute between the USA and China. However, when pressed, he did admit that the proposed sanctions of $200 billion on Chinese imports would have a negative impact on the economy.

This is similar to when Mark Carney, the Governor of the Bank of England, stated before the Brexit referendum that if the vote passes it would hurt the Pound. The statement doesn’t take sides, it simply states the view of someone who is in a good position to understand the economic impact.

So, it was a bit surprising that a few hours after our lesson, Donald Trump had a few remarks of his own about what he thinks the Fed should or shouldn’t be doing.

Though President Trump insists that he’s not trying to influence the Fed’s decision, the very fact that he stated his opinion will likely have an impact on policy, it certainly had an impact on the markets.

Here we can see the US Dollar falling at the time of the interview.

The price of gold also reacted to the administration’s new policy.

Well… maybe not a new policy. Trump did blast Yellen while on the campaign trail for raising interest rates but this is the first time that any US President has so publicly disputed central bank policy, at least not since Bush Senior & Greenspan.

Meanwhile, Trump is still under pressure for his performance with Putin in Helsinki and we’re watching that play out in the press and in Congress.

Stock markets remain mixed while all this sinks in.

Mixed Crypto Rally

There’s been a lot of excitement in the crypto markets over the last few days and everybody wants to know where this is going.

Here’s an article that’s rather bullish…

…and here is one that’s quite bearish…

My thoughts…

It’s still too early to say for certain. The chart of bitcoin is sending rather mixed signals. On the one hand, the downward trendline (yellow) that that has loomed over Bitcoin for the better part of this year has now been broken.

On the other hand, the current rally has stopped significantly short of breaking the strong line of resistance (dotted blue) that kept the price notably depressed in early June. A break above that could very well lead us to $10,000 (green line) but only a clean break above that would indicate a shift in the medium term trend.

One point that is giving a positive sign is the level of divergence between different digital assets. Here we can see a graph containing all the cryptos currently traded at eToro over the last few days.

We’ve noticed in the past that when the trend is down the cryptos tend to stick more closely together, whereas when things are moving up we tend to see more mixed results. The price action over the last 48 hours would certainly indicate the latter.

As always, tag me at the links below if you need anything at all. Wishing you a very pleasant weekend.

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.

Best regards,
Mati Greenspan
Senior Market Analyst

Connect with me on….

eToro: @MatiGreenspan | Twitter: @MatiGreenspan | LinkedIn: MatiGreenspan | Facebook:MatiGreenspan

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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4.7 stars on average, based on 115 rated postsSenior Market Analyst at Etoro.com.




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Pre-Market: China Tries to Support Markets as Global Stocks Slide

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Yesterday’s risk-off shift continued today in early trading with nervous and choppy trading in Asia and Europe, as global financial markets are still haunted by trade war fears and emerging market weakness. The major US indices rolled over after another period of apparent relative strength, with the Nasdaq being the most robust market once again, while most of the key European benchmarks continue to lag behind.

S&P 500 Futures, 4-Hour Chart Analysis

Chinese assets are still in focus before the weekend, as the Yuan’s recent steep devaluation sparked fears of a credit meltdown in the country. With the largest credit bubble in human history casting its shadow on China, some analysts think that with Trump’s trade war, the bug finally found its windshield and the bubble already started to burst.

USD/Yuan, 4-Hour Chart Analysis

All eyes are on the USD/Yuan pair as Chinese authorities are reportedly intervening in the market of the currency, and most likely local equities as well, trying to prevent a serious run on the most important assets.

With the Chinese stock market already in a bear market, and the Yuan trading at fresh 12-month lows against the Dollar, it might be a bit late to stop the slide, but the intervention could cause spectacular short squeezes.

Italy also made headlines today during the European session, as Italian government bonds got slammed lower, as the future of the new finance minister is uncertain, with another round of political turmoil possibly ahead for Europe’s most vulnerable country.

Unicredit (UCG), 4-Hour Chart Analysis

Looking at the charts of Italian banks, it’s clear that the spring turmoil had a lasting effect on the financial system, as Unicredit is on the verge of hitting a new low, and the other large players also remain under pressure, in part explaining the general weakness in European equities.

Europe Still Far Behind amid Mixed Economic Numbers

USD/CAD, 4-Hour Chart Analysis

The economic calendar is almost empty today with regards to the key markets, as the Canadian Retail Sales and CPI reports are the most important releases. The Canadian Dollar rebounded when the USD entered a correction June, but now the currency edging lower again, as the weakness in commodities and the Greenback’s rally are taking their toll. New highs are likely in the USD/CAD pair in the coming weeks, although strong resistance is just ahead at 1.33.

Commodities are little changed today after yesterday’s volatile session, as the bounce in China helped to stabilize the segment. Notably copper is back above the key $2.70 level, while WTI crude oil is trading at $68 per barrel again, and gold is hovering around $1225.

Featured image from Shutterstock

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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4.6 stars on average, based on 296 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Market Update: U.S. Stocks Rattled by Trade-War Rhetoric; Cryptocurrencies Stabilize After Brief Dip

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U.S. stocks turned lower Thursday, with the S&P 500 Index easing off five-month highs as trade tensions and mixed corporate results weighed on investors’ sentiment.

Wall Street Sees Red

The benchmark averages were down across the board, with the large-cap S&P 500 Index edging down 0.4% to 2,804.49. Financials shares were the biggest laggards, falling more 1.4% as a cluster. Materials stocks were also down sharply. In total, eight of 11 primary sectors tracked by the S&P 500 finished in negative territory.

Dow industrials finished down 134.79 points, or 0.5%, to 25,064.50. The Travelers Cos Inc. (TRV) and American Express Co (AMX) were the worst performers, falling 3.7% and 2.7%, respectively.

The technology-driven Nasdaq Composite Index fell 0.4% to close at 7,825.40.

The CBOE VIX, also known as the fear index, rebounded from six-month lows, though the underlying picture continued to show complacency in U.S. stocks. The VIX rose more than 6% on Thursday to close at 12.90. Readings below 20 are generally associated with periods of calm on Wall Street.

On the earnings front, shares of eBay Inc. (EBAY) fell after the company offered disappointing guidance in its quarterly report released late Wednesday. Dow blue-chip American Express Co (AXP) posted per-share earnings that were higher than expected, but revenues fell short.

Trade Tensions Weigh

The market downshifted one day after U.S. President Donald Trump reiterated his vow to tax European automakers. Trump threatened “tremendous distribution” against Washington’s allies unless “something fair” could be negotiated.

Earlier this month, levies on $34 billion in Chinese goods came into force as part of an original plan to tax up to $50 billion in imports. The U.S. president has also threatened to implement levies on an additional $200 billion in Chinese imports – a move that Beijing would not be able to match dollar-for-dollar.

Resistance to the president’s tariff policy is growing within Congress, with a bipartisan group of 149 House members urging Trump to abandon his protectionist stance.

Crypto Market Recovers After Dip

The cryptocurrency market remained on track for its second weekly advance in three as bitcoin recovered from an intraday slide and altcoins came off session lows.

After reaching a high of $299.8 billion Wednesday, the cryptocurrency market saw its total capitalization fall to $287.9 billion. Still, trade volumes were $17 billion, which is considered robust in comparison to the last three months.

Bitcoin, the largest crypto asset by market cap and trading volume, was little changed compared with 24 hours ago. BTC values are currently hovering north of $7,450.

Stellar XLM defied the market downtrend to report minor gains on Thursday. In doing so, Lumens overtook Litecoin for sixth spot in the crytpo market cap rankings. At the time of writing, Lumens were trading around $0.31.

EOS was among the worst performers in the top-ten, falling 4.5% to $8.31. IOTA was also down more than 4% to $1.05.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

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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4.6 stars on average, based on 502 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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