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Asian Market Update – Tuesday: Litecoin price skyrockets despite creator’s warning; Asian stocks down

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litecoin

The Big Question: What’s going on with litecoin?

Bitcoin might very well be the top story these days, but an explosive run by litecoin in recent days has gotten the attention of the cryptocurrency world and beyond.

After gaining more than $68 to hit a new record of $235 on Coinbase on Monday, litecoin prices continued to surge Tuesday morning in Asia. At midday, the cryptocurrency was up 17 percent to $255, another all-time high.

Though litecoin has been in a strong uptrend all year, its appeal has been hidden in the shadow of bitcoin. That was until last weekend when the price exploded, sending the coin surging by more than 150 percent over the past 5 days. Having gained more than 4,000 percent this year (more than bitcoin’s 2,000 percent), litecoin may be ready to take the step into mainstream following bitcoin’s enormous success.

Litecoin’s rapid increase in value comes after creator Charlie Lee even warned of the risks of buying litecoin, saying on Twitter:

“Sorry to spoil the party, but I need to reign in the excitement a bit… Buying LTC is extremely risky. I expect us to have a multi-year bear market like the one we just had where LTC dropped 90% in value ($48 to $4). So if you can’t handle LTC dropping to $20, don’t buy!”

According to CryptoCoinsNews, some of the reasons reported for litecoin’s price surge may be:

  • An increasing user base on Coinbase, being the most popular platform for new investors in cryptocurrencies. Litecoin is one of few cryptocurrencies available on the platform, and many new users may simply be buying litecoin because they learn about it from Coinbase.
  • Appearances of Charlie Lee on several prominent news networks, including CNBC, may have boosted public interest.
  • Gaming giant Steam has replaced bitcoin payments with litecoin citing rising costs for bitcoin transactions for small purchases.

Also, a strong fan base for litecoin is in the making. Many argue that litecoin is bitcoin’s younger sibling and could rise to where bitcoin is today.

Ethereum also continued on a strong upswing on Tuesday morning. At midday, ethereum was up 2.70 percent to $532 -a record high for the cryptocurrency. Tuesday’s gain followed a huge gain of $71 to a high of about $518 on Monday.

Bitcoin was nearly unchanged on Tuesday, after a big surge on Monday following bitcoin’s debut on the on the CBOE Futures Exchange in Chicago. At midday on Tuesday, bitcoin price was down 0.7 percent to $16,765 on Coinbase. Bitcoin gained more than $1,600 on Monday.

Main Market Movers – Mid-day Asian Trading Session

Indexes Value at Midday Daily Change
Japan- Nikkei 225 22,900 -0.17%
China-Shanghai Composite Index 3,303 -0.57%
Hong Kong –Hang Seng 28,832 -0.46%
South Korea-KOSPI 2,459 -0.47%
Australia-ASX 200 6,009 0.18%
S&P 500 E-Mini Futures 2,666 0.08%

Major Asian equities were narrowly down on Tuesday morning, after three days of straight gains that continued on Monday, following strong performance on Wall Street overnight.

The slow Asian trading was led by stocks on the Chinese mainland. The Shanghai Composite Index edged down 0.57 percent at midday on Tuesday to 3,303. That came after the People’s Bank of China injected 150 billion yuan (about $22.7 billion) into the financial markets through a reverse bond repurchase arrangement on Tuesday.

In Hong Kong, the Hang Seng Index was down 0.50 percent to 28,832.

In South Korea, the Kospi lost 0.47 percent to 2,459 at midday.

In Japan, the Nikkei 225 Index was off 0.17 percent to 22,900.

Stocks moved up a bit Down under, with the ASX 200 up a slight 0.18 percent to 6,009 at midday.

The S&P 500 E-Mini Future was up 0.08 percent to 2,666.

Investors are closely watching meetings of the Fed and the ECB this week. The Fed will conclude its two-day meeting on Wednesday and markets are looking for cues of rate hikes in 2018. The Fed had previously signaled three hikes in 2018, but recent positive economic data could change the number of rate increase, some analysts say. The ECB, which is scheduled to meet on Thursday, is not expected to make any major changes.

Meanwhile, tax reform talks in the US, trade talks among North American countries and Brexit negotiations are continuing.

Currencies

The Japanese yen firmed 0.06 percent against the US dollar at midday Tuesday, changing hands at 113.47 per dollar.

The Chinese yuan lost 0.02 percent against the US dollar at 6.6214 per dollar.

The Australian dollar firmed 0.10 percent on the dollar, changing hands at 1.3273 per dollar at midday.

Commodities

WTI Oil gained 0.47 percent to $58.27 per barrel.

Brent Crude edged up 0.96 percent to $65.32 per barrel.

Gold was up 0.18 percent to $1,244 an ounce.

News across Asia

In China, officials and experts are warning Chinese companies that do business in Australia of potential changes in policy, as China-Australia relations have worsened. Aussie officials have voiced sharp criticism of China over alleged Chinese influence in Australian politics through business operations.

Take away: China-Australia trade ties have traditionally been strong, with China importing tens of billions of dollars worth of Australian goods. But recent signs show that that could change as China shows willingness to use trade as leverage in political disputes with Australia.

In the Philippines, a bank that has been blamed for being used to steal $81 million from Bangladesh’s central bank has accused monetary officials there for covering up their negligence and making the bank a scapegoat. Bangladesh Bank has asked US officials to join a lawsuit against the Philippines’ Rizal Commercial Banking Corp (RCBC) over the stolen funds. Unidentified hackers stole the money from Bangladesh Bank and sent it to RCBC.

Take away: The case, if Bangladesh Bank wins, could provide precedent for other hacking incidents where a company or bank were unknowingly involved.

Featured image from Pixabay.

Disclaimer: The author owns bitcoin, ethereum and litecoin. He holds investment positions in the coins, but does not engage in short-term trading.

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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  1. saxonlucius

    December 12, 2017 at 3:56 pm

    I had just mentioned a couple days ago that Litecoin is a good contender to take first place on the private Exchanges. The single largest, most credible exchange in the west, is GDAX. I don’t use GDAX, but I did before the Ether Flash Crash over a year ago. GDAX has Bitcoin, Litecoin, and Ethereum. For most Americans just getting into Crypto, GDAX offers the easiest way to get into it with minimal security and a great API. The cheapest currency is Litecoin, and it looks like the lowest risk for anyone coming in. I have huge respect for Charlie Lee, and he may be right, but I feel as though a lot of people are underestimating the number of people who are entering the market now. All I ever hear about on NPR, the News, and TV is Bitcoin. People are asking me constantly about it. For now, Crypto is not only the drug of the American Consumer but the World Consumer.

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Analysis

Another Volatile Day on Wall Street

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US stock markets had an ugly morning after a bearish overnight session, with the major indices all hitting new correction lows, and with the Russell 2000 confirming the under-the-hood weakness on Wall Street yet again. The afternoon session saw another violent counter-trend rally, led by the Nasdaq that almost erased the 2+% losses accumulated during the first hours of trading.

Dow 30 Futures, 4-Hour Chart Analysis

The most-awaited US earnings releases were a mixed bag today, as although the bottom line of the majority of companies beat estimates, the likes of 3M (MMM) and Caterpillar (CAT) outright crashed due to their disappointing guidance, putting even more pressure on the already shaky stock market.

Caterpillar (CAT), 4-Hour Chart Analysis

Verizon (VZ) and McDonald’s (MCD) performed much better after their earnings beat, but both companies are considered more defensive, and their encouraging results didn’t help the broader market in the gloomy environment. Texas Instruments (TXN) reported after the closing bell and as the semiconductor giant cut his guidance, the stock is down by around 5% lower in after-hours trading.

Treasuries Bounce Hard as Safe-Haven Flows Intensify Again

As for economic news, the German monthly PPI came in much higher than expected, the European Consumer Confidence Index was in line with expectations, while the US Richmond Manufacturing Index came in at 15, well below last month’s reading of 29 and the consensus 25.

XHB, 4-Hour Chart Analysis

Tomorrow we will have the flash manufacturing and services PMIs from Europe and the US together with US new home sales, and the housing market gauge will be in the center of attention. US homebuilders have been plunging lower in recent weeks, and the XHB ETF is deep in a bear market already, as rising yields and mortgage rates hit the sector hard this year.

Today the segment outperformed thanks to the pullback in yields, and a positive surprise in sales could spark a meaningful short-covering move.

10-year US Yield, 4-Hour Chart Analysis

While the swift rise in yields triggered the seep correction, at least on the surface, today the decline in stocks pushed yields lower thanks to strong the strong safe-haven flows, which also helped the Japanese Yen and gold, especially in early trading.

WTI Crude Futures, 4-Hour Chart Analysis

Commodities had a very volatile day even as copper was relatively calm, with the plunge in crude oil and the pump & dump in gold drawing a lot of attention to the segment. While gold simply followed the risk trade, hitting multi-month high in European trading and pulling back in line with the rally on Wall Street, oil was reacting to the news from Saudi Arabia regarding a pledge to increase supply this year.

The WTI contract fell to a $65 per barrel handle, a new 2-month low, shedding almost 5% in one day, and it’s hard not to spot the connection between Donald Trump’s demands regarding lower crude prices, the disastrous Saudi cover-up of the Khashoggi murder, and today’s announcement that could help in easing the tensions between the US and the Kingdom.

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 381 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 Overview

Market Update: U.S. Stocks Fall Again on Geopolitics, Global Growth Woes; Bakkt Announcement Fails to Inspire Crypto Rally

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U.S. stocks followed their European and Asian counterparts lower on Tuesday, as geopolitical tensions and concerns over global growth dampened investors’ sentiment. Crypto markets were little changed after Intercontinental Exchange (ICE) set a date for the launch of its new digital currency platform.

Stock Selloff Deepens

Wall Street opened with heavy losses following a tumultuous pre-market that saw Dow Jones futures plunge by more than 400 points. By the end of the day, all major U.S. indexes were well off session lows.

The large-cap S&P 500 Index closed down 0.6% at 2,740.69. Eight of 11 primary sectors finished lower, with energy shares plunging 2.5% as a whole. Industrials, materials and financials also experienced heavy losses.

Dow industrials fell 125.98 points, or 0.5%, to finish at 25,191.43. Caterpillar Inc. (CAT) and 3M Co (MMM) were the biggest decliners after announcing negative earnings guidance this year and next.

Meanwhile, the technology-focused Nasdaq Composite Index fell 0.4% to 7,437.54.

The CBOE Volatility Index, also known as the VIX, reached a session high of 24.66 on Tuesday. It would later settle at 20.71 for a gain of 5.5%.

Earnings Optimism Fades

Despite starting off on a solid note, third-quarter earnings season has produced mixed results for Wall Street’s big firms. Companies that missed the mark on their top and bottom lines have faced heavy selling pressure despite strong performances in other sectors.

On Tuesday, Dow blue-chip 3M lowered its earnings outlook for 2018 while Caterpillar acknowledged it will have to raise prices for most of its machines next year. Both companies are facing the burden of President Trump’s tariff war and what appears to be a protracted slowdown in China.

The Chinese economy expanded 6.5% annually in the third quarter, the weakest since 2009. The U.S. economy is projected to grow 3.9% annually between July and September, according to the Atlanta Fed’s GDP tracker. Economists at the Commerce Department will produce their first batch of Q3 GDP numbers on Friday.

Cryptos Extend Dismal Performance

Digital currencies failed to rally on Tuesday after Intercontinental Exchange announced a date for its new cryptocurrency platform. The global exchange operator announced Monday it will begin settling physical bitcoin futures contracts on Dec. 13. Bakkt, the platform that will facilitate the transactions, has been touted as a potential game changer for luring large sums of institutional capital to the crypto arena.

The cryptocurrency market cap reached a low of $207.6 billion on Tuesday, and was last seen hovering around $209.4 billion. Majors like bitcoin, Ethereum and Litecoin saw little movement compared with 24 hours ago. Meanwhile, XRP fell 1.3%. Bitcoin cash and Cardano and Tron were also down slightly.

Low-volume trading continues to impede on the market’s recovery. On Tuesday, volume across all virtual currency exchanges reached $10.4 billion, according to CoinMarketCap.

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 649 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Market Overview

The Easy Way In

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Hi Everyone

It’s quite natural to think that the news influences markets but in many cases, it simply isn’t true. People move markets.

In traditional markets, we see often how an announcement regarding employment or inflation, or an interest rate decision from a central bank can have a huge impact on prices.

This is mainly due to the vast number of investors who are anticipating these type of events and are ready to deploy a large amount of capital at the drop of a hat.

In crypto, we simply don’t have that just yet. You’d think that news of half a dozen major financial institutions will be opening new options for cryptotrading and cryptoasset solutions would have an effect on prices but they’ve so far remained stable.

So it’s not surprising that LibertyX and Genmega are about to convert 100,000 ATM machines across the USA into user-friendly bitcoin vending machines has had no impact on the price of bitcoin.

What this does do though is builds the infrastructure that will be necessary for mass adoption, so that when people do decide to buy, they’ll have an easy way in.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Asia Rally Over
  • Flight to Safety
  • Crypto Correlation

Please note: All data, figures & graphs are valid as of October 23rd. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

Looks like Monday’s massive rally in Asia has been short-lived. By the time the bell rang on Wall Street, the mood had already turned sour and stocks across the board ended up down.

The only exception, oddly enough, was the Faang stocks, which managed to hold up the Nasdaq. As we discussed in yesterday’s update investors are looking to invest, but cautiously. Well, it looks like they found their refuge in the top tier brands.

The exception we can notice above is Netflix which dropped with the rest of the market. Also, it’s worth noting that even the Nasdaq futures are down this morning and the entire market threatens to break lower.

Here we can see the S&P500, which is sitting firmly below its 200 day moving average (blue line).

Perhaps the light at the end of the tunnel here is the upcoming earnings reports that will be closely watched by investment managers.

Flight to Safety

As the stocks turn red, we can see some clear signs that the other markets are looking for some safety. Turkish President Erdogan isn’t helping much either with strong accusations against the Saudi government over the Khashoggi incident.

Some are buying bonds as a way to lower the risk. As well the Japanese Yen is up sharply due to its status as a safe haven currency. This graph shows the greenback bowing to the Yen (this morning in the purple circle).

Of course, the most vulnerable at the moment are the emerging markets currencies, which are performing particularly poorly today.

Another clear sign of safe haven trading is the fact that gold has broken out to the upside making significant stretch into fresh highs and now trading at the highest levels since July.

Crypto Follow?

Though we’ve pointed out recently that crypto assets bear only a very small correlation with the stock market, they still are considered to be a high risk asset.

We have seen several times before where fear in the stocks has managed to spill over into the crypto markets and that might just be what’s happening at the moment.

The declines in crypto are very light today. This could be because, as we mentioned above, the tech sector seems to be mostly shielded from the current sell-off. In any case, there’s no denying that bitcoin and the Nasdaq are moving in tandem today.

Wishing you 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

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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4.6 stars on average, based on 133 rated postsSenior Market Analyst at Etoro.com.




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