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Asian Market Update – Thursday: Cryptocurrencies Drop from Recent Highs after More Attacks from Prominent Figures

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Morgan Stanley building

The Big Question: Is the establishment just scared or are they telling the truth?

Prices of cryptocurrencies were pointing lower overnight during the Asian trading session on Thursday, shaking off some earlier gains seen on Wednesday, and again, more prominent figures in the financial world took aim at bitcoin and other cryptocurrencies.

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At midday in Asia, the bitcoin price was down by 0.58 percent to $4,175, despite a bit of a surge back from a low of $4,160 in early trading. The virtual currency saw big gains on Wednesday when it surged from about $3,884 to surpass the $4,000 mark and reach a high of $4,200. Bitcoin has now traded under the $4,000 mark since September 20.

Etherum was also in a downtrend overnight, having lost 1.70 percent to $305 as of midday Thursday in Asia. Ethereum also surged from a low of $288 all the way to $310 before it went into a downward move. Ethereum has been trading under the $300 level since September 18.

Litecoin also slipped overnight. By midday Thursday, it had dropped 1.79 percent to $55.95. The litecoin price reached a high of $57 on Wednesday, the first time since September 19, when the virtual currency entered into a turbulent period.

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In the news, Morgan Stanley CEO said on Wednesday “[the cryptocurrency market] is obviously highly speculative,” though he praised the concept of anonymous currency.

Jordan Belfort, famously known as the “Wolf of Wall Street,” reportedly said this: “I’m not saying you should or shouldn’t buy bitcoin, but [what] I’m saying is I personally, myself, would be very, very careful about investing a lot of money in something that could vanish very quickly.”

Main Market Movers – Mid-day Asian Trading Session

Indexes Value at Midday Daily Change
Japan-Nikkei 225 20,325.52 0.29%
China-Shanghai Composite Index 3,342.19 -0.09%
Hong Kong –Hang Seng 27,542.92 -0.36%
South Korea-KOSPI 2,369.81 -0. 12%
Australia-ASX 200 5,673.20 0.16%

Major Asian indexes were mixed as of midday Thursday, as geopolitical tensions took a back seat and markets turned their focus on a meeting of the Bank of England scheduled for today.

In Japan, the Nikkei 225 tacked on 0.29 percent to 20,325.52 at midday.

In Greater China, stocks were pointing lower. The Shanghai Composite Index slid 0.09 percent to 3,342 at midday. In Hong Kong, the Hang Seng Index slipped 0.36 percent to 27,542. Mainland markets will be closed next week for the National Day holiday.

In South Korea, the KOSPI index slipped 0.12 percent to 2,369. The South Korea Stock Exchange will be closed next week for a holiday.

Down under, the ASX 200 was up a slight 0.16 percent to 5,673 at midday.

As geopolitical tensions in the Korea Peninsula remained calm and things are quiet on the economic data front (though US economic data is due), investors are now paying attention to a meeting of the UK central bank. Top policymakers from the UK, the US and Australia are scheduled to speak at the event, and investors will keep their eyes on any cues of monetary policy changes.

Also in the States, President Donald Trump announced a highly-anticipated Tax Reform Plan on Wednesday, pushing up US Treasury yields and the dollar, but many remain pessimistic about the chance of the passage of the reform at a time with lots of political turmoil in the US.

Currencies

The Japanese yen lost 0.24 percent against the US dollar at midday Thursday, to 113.07 per dollar.

The Chinese yuan lost 0.23 percent against the US dollar to 6.6577.

The Australian dollar also lost 0.42 percent on the dollar, changing hands at 1.2785 per dollar at midday.

Commodities

WTI Oil was down 0.13 percent to $51.94 per barrel.

Brent Crude was up 0.05 percent to $57.67 per barrel.

Gold lost 0.07 percent to $1,280 an ounce.

Business News across Asia

In China, Apple is in big trouble in the company’s largest single market, according to local media. Reports said that due to “dissatisfaction” over the new iPhone 8, Chinese consumers are returning their iPhones. One report said iPhone 8 sales are “unusually terrible.”

Take away: Apple has seen sharp sales declines in China lately, as Chinese consumers seem to be no longer impressed by Apple’s innovative technologies and designs as well as the rise of domestic brands such as Huawei and Xiaomi.

In Japan, Prime Minister Shinzo Abe got himself a challenger as the world’s third-largest economy is expecting a general election next month. Tokyo Governor Yuriko Koike is reportedly leading a new party with populist slogans to challenge the ruling Liberal Democratic Party.

Take Away: The new party is floating ideas such as ending nuclear power and freezing a sales tax hike, though other themes are largely similar to that of the current ruling party, according to Japanese media. If the new party gains traction, it could rattle markets, which hate uncertainties the most.

Featured image from Wikimedia Commons.

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 28 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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2 Comments

2 Comments

  1. Matt_a

    September 28, 2017 at 10:13 am

    In these days BTC just showed some strength and the reason to write such an article would be because it feel 0.5% !?!?!? What a BS! Seems the aim is just to spread FUD and I really don’t feel like I should keep wasting money to read this nonsense…

  2. nptraveller

    September 28, 2017 at 2:13 pm

    “vanish very quickly”? And why now, all of a sudden? Jordan Belfort? Sure I trust him. Morgan Stanley CEO? Who? Said what? Oh, FFS, I’m gonna sell all my BTC right away… Bitcoin is dead.

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Market Overview

Market Update: Dow Jones Sinks 400 Points as Government Bond Yields Top 3%

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U.S. stocks plunged on Tuesday, with the Dow Jones Industrial Average sinking more than 400 points as rising government bond yields drove investors into risk-off mode.

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Stocks Plunge

The Dow blue-chip index plunged 424.56 points, or 1.7%, to close at 24,024.13. That marked the fifth consecutive decline and the lowest settlement in almost three weeks.

Twenty-four of 30 index members recorded losses, with Caterpillar Inc. (CAT) and 3M Co (MMM) falling more than 6% apiece.

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Caterpillar reported first-quarter earnings that were well above expectations but indicated that economic growth will slow for the remainder of the year.

The broader S&P 500 Index closed down 1.3% at 2,634.56, with nine of 11 sectors reporting declines. Industrials plunged 2.8%; while materials declined 2.6%. Heavy losses were also reported for IT, consumer discretionary and energy stocks.

The technology-heavy Nasdaq Composite Index declined 1.7% to 7,007.35.

A measure of implied volatility known as the CBOE VIX surged more than 10% on Tuesday to settle at 18.02. The so-called “fear index” trades on a scale of 1-100, with readings below 20 usually indicating calmer conditions for Wall Street. Despite its current reading, the VIX has been anything but calm in recent months, having reached a high above 50 in early February.

Interest Rates Rise

A sharp rise in government bond yields has been one of the major catalysts for the recent downturn in the market. The yield on 10-year U.S. Treasury notes climbed above 3% on Tuesday for the first time since early 2014.

Investors have been selling Treasurys throughout April – pushing the yield higher – amid expectations of tighter monetary policy from the Federal Reserve. Policymakers are said to be eyeing at least two more interest rate hikes this year to combat rising inflation.

The pressure from inflation will likely strengthen due to tax cuts and infrastructure spending. The Fed targets consumer price growth at 2% annually and uses a measure called the core PCE index to evaluate inflationary trends. The core PCE index strengthened to 1.6% in March, the biggest gain since February 2017.

Cryptocurrency Rally Accelerates

The cryptocurrency market shifted into high gear on Tuesday, with bitcoin and the broader altcoin universe adding $35 billion. At the time of writing, the cryptocurrency market was worth a combined $433.4 billion, according to CoinMarketCap. That’s the highest level since early March.

Bitcoin’s value continued to rise, but its overall share of the market fell to around 37%. BTC rose more than 6% to $9,463, bringing its total market cap to $160.8 billion.

Ethereum added more than 10% to $705. Ripple XRP gained 7.5% to $0.937. Bitcoin cash also extended its winning streak, rising 5.4% to $1,466.

Double-digit gainers included EOS, which surged more than 37% to $15.85, and Cardano, which added 10.5% to $0.316.

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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4.5 stars on average, based on 348 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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Analysis

Pre Market: Dollar Pulls Back from 7-Week High as Stocks Rebound

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Global equities are attempting to rally after drifting lower for three sessions, with Asia leading the bounce thanks to rumors regarding possible monetary easing steps in China. The rumors surfaced on the heels of the Yen’s plunge which followed Bank of Japan governor Kuroda’s dovish words. Mr. Kuroda is worried about the stubbornly low inflation rate, and hinted on a delay of the ”normalization” process of the central bank’s monetary policies.

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USD/JPY, 4-Hour Chart Analysis

As a reminder, the BOJ now owns the majority of the stock ETFs in Japan, but we might reach a point where it will own the whole float (why not?), while also technically controlling the whole Japanese government bond “market”. Meanwhile, the Euro also got under pressure lately thanks to the string of negative economic surprises and Mario Draghi’s cautious words regarding growth, and with Thursday’s ECB meeting looming, forex traders could be in for a very active week of trading.

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EUR/USD, 4-Hour Chart Analysis

The Dollar reached a 7-week high against the Euro yesterday, while the Dollar index closed at the highest level since January, and although the Greenback is correcting the recent rally today, it seems that the growing number of Dollar bears might be in for more pain after a likely short-term correction, as Treasury yields continue to rise relentlessly.

US 2-Year Treasury Yield, 4-Hour Chart Analysis

Stocks are having a relatively quiet week so far, but the bearish trend of the recent sessions remains dominant despite today’s bounce, even as volatility is still low, and trade war fears and geopolitical tensions have been easing somewhat lately. We switched to a bearish bias last week, and we maintain that the stocks look vulnerable here, although the short-term overbought readings have been cleared.

S&P 500, 4-Hour Chart Analysis

Bulls still have the hope that the major US indices can resume the recovery and launch a rally towards the all-time highs, but unless we see a quick move above last week’s highs, bears remain in control, and another test of the correction lows is likely.

On a slightly positive note, European equities enjoyed some relative strength in the last couple of days, as they were boosted by the weakness in the Euro, but looking at the broader picture, the Old Continent continues to be among the weakest regions globally since the start of the correction.

Commodities Mixed but Commodity Currencies Still Weak

AUD/USD, 4-Hour Chart Analysis

Interestingly, the Aussie and the Canadian Dollar are still under selling pressure today, despite the risk rally, and that fact strengthens our short-term bearish view on stocks, as they have been reliably leading equities since February.

In the meantime, commodities have been trading in a choppy fashion amid the Dollar rally, as gold has been pushed back below $1330 again, continuing its lengthy consolidation phase, while crude oil slightly retreated from its multi-year high near the $70 per barrel level concerning the WTI contract.

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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Market Overview

Takes a lot of GUTS – Making Blockchain Mainstream

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Take a guess… What do all of these people have in common?

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They all have Ethereum wallets and don’t even know it.

The new GET protocol is designed to use blockchain as an engine and run seamlessly in the background without the end user ever knowing what powers the application.

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The GUTS ticketing app is the first mainstream application to use GET and the people in the above photo are the first 1000 users. It’s estimated that more than 1 million people in the Netherlands will use it to securely purchase tickets without the fear of scalpers.

Welcome to the future!

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Global Selloff Pauses for Earnings
  • EOS is now available in eToro!
  • Cryptocurrency Future in India

Please note: All data, figures & graphs are valid as of April 24th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

The global stock rout that we’ve been seeing since early February is seemingly on hold for the time being.

Earnings season is going great, and why wouldn’t it? Donald Trump’s recent tax cuts and economic stimulus seem to be spurring the economy and adding to corporate profitability as designed.

Some economists, like Alice Rivlin of the Brookings Institute, argue that all this stimulus is coming at the wrong point in the economic cycle. Usually, countries try to stimulate the economy when it is doing poorly but when it is doing well they want to tighten things up and save the surplus for a rainy day.

As long as earnings are good, stocks should rise. The question then is what happens when earnings season is over?

The Nasdaq100 has managed to defend its position at the 200 day moving average (blue) and has since rallied a bit but it doesn’t seem like we’re quite out of the woods just yet.

Introducing EOS

eToro is very proud to announce that we have added EOS as the tenth cryptocurrency available on the platform. Of the 2000+ assets that you can trade on the platform this one is one of the most interesting.

If Bitcoin is digital gold and Ethereum is digital oil, EOS has been likened to digital real estate.

The ICO is ongoing and set to last an entire year ending on June 1st, 2018. In the end there will be a total of 1 Billion EOS in the world.

By owning EOS one token you are entitled to one billionth of the computing power of the total network. Unlike other utility tokens, EOS are not burned in the transactions. So owners will be like landlords of their space on the network.

Proponents say that this is the next level for blockchain after Ethereum and is designed to be an operating system for decentralized applications. With it, developers will be able to create apps that utilize blockchain without the end user ever knowing the intricacies of the supporting technology.

The price is up 17% since the asset has been added on the platform and up more than 100% over the last month knocking out Litecoin for the number 5 slot of all cryptocurrencies by market cap.

As with all cryptos, EOS is still in the experimental phase and as such carries a significant degree of risk.

Always diversify your portfolio with many different types of assets and not just cryptocurrencies, please.

Cryptos in India

Lastly, I’d like to thank those users yesterday, especially in India, who quickly replied to clarify a tweet I sent out regarding the RBI’s decision to ban cryptocurrencies.

To be clear, the high court has given the RBI 48 hours to respond to the claim that their new policy is unconstitutional. This happened on Sunday so their response is actually due today.

Unfortunately, this isn’t over just yet and from what it seems the court could take further time to sort this out. We hope for a quick and positive resolution in this high stakes case.

A reminder to ever rely on a single source of information. Always do your own research. 😉

Have an excellent day ahead!

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

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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