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Market Overview

Asian Market Update – Wednesday: Cryptocurrencies stand firm after losses yesterday; Asian stocks tracks global rally

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Cryptocurrency prices were trading higher during Asian trading on Wednesday morning, with bitcoin stabilizing above $8,100 and ethereum and litecoin also making slight gains.

Bitcoin was up 0.81 percent to about $8,167 before midday in Asia. The gains were made after bitcoin dropped earlier in the morning to find support north of the $8,000 line.

On Tuesday, bitcoin dropped from $8,252 to $7,851 before climbing all the way back to about $8,340.

Ethereum also pointed higher around midday, gaining 0.61 percent to about $357. Ethereum also appears to have hit support earlier in the morning when it fell from $369 to $36.

Litecoin surged 1.32 percent to about $70 at midday in Asia. With the gain on Wednesday morning, Litecoin erased a big chuck of the losses seen yesterday, when the coin dropped about 4 percent.

Main Market Movers – Mid-day Asian Trading Session

Indexes Value at Midday Daily Change
Japan- Nikkei 225 22,590 0.78%
China-Shanghai Composite Index 3,428 0.53%
Hong Kong –Hang Seng 30,090 0.91%
South Korea – KOSPI 2,542 0.46%
Australia-ASX 200 5,996 0.55%
S&P 500 E-Mini Futures 2,597 0.06%

Major Asian equity indexes were trading higher Wednesday morning, tracking global stocks in a rally, with bigger gains seen in Tokyo and Hong Kong.

The Nikkei gained 0.78 percent to 22.590 before midday.

On the Chinese mainland, the Shanghai Composite Index was up 0.53 percent to about 3,428 before midday. In Hong Kong, the Hang Seng Index was 0.91 percent lower at around 30,090.

In South Korea, the Kospi added 0.46 percent to 2,542 before midday.

Down Under, the ASX 200 was up 0.55 percent to 5,996 in Australian afternoon trading.

The S&P 500 E-Mini Futures was 0.06 percent higher at 2,597.

The gains in Asian stocks were in line with rallies in the global financial market, with investors showing optimism about the global economic recovery and a prospect that the US could pass the much discussed tax reform.

Positives signs have been reported in major economies such as Germany, the US, Japan and China, suggesting a solid recovery for the global economy and a boon to financial markets.

Currencies

The Japanese yen gained 0.1 percent the US dollar at midday Wednesday to 112.32 per dollar.

The Chinese yuan lost 0.03 percent against the US dollar at 6.6287 per dollar.

The Australian dollar also lost 0.13 percent on the dollar, changing hands at 1.3212per dollar at midday.

Commodities

WTI Oil was up 0.12 percent to $57.66 per barrel.

Brent Crude gained 0.54 percent to $63.01 per barrel.

Gold was up 0.05 percent to trade at $1,281 an ounce.

Business News across Asia

In China, authorities are cracking down on the country’s rising micro online lending sector. The top office that oversees online lending has issued a notice to local government to stop issuing licenses to small online lending firms.

Take Away: The move is part of the country’s top priority to fend off systemic financial risks, coordinated by a new government committee that is making its print in financial regulation.

In Australia, local retailers have been told by Amazon to prepare to take orders starting on November 23, when the US e-commerce giant goes live in the Australian market. Amazon confirmed in April that it would expand to Australia, but did not give any specific date.

Take Away: By announcing the data early and choosing a date just one day before this year’s Black Friday, Amazon is surly trying to make a fuzz about its Aussie debut.

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

What the Dickens?

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Hi Everyone,

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.”

-Charles Dickens,
A Tale of Two Cities (1859)

I wonder if Dickens was a day trader…

Today’s Highlights

  • Tale of Two Sell-Offs
  • Fed Expectations
  • SEC Twist

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

Traditional Markets

Though we’ve shown in the past that on a day to day basis the stock markets are not very correlated with cryptoassets. However, it’s impossible to shake off the feeling that somehow the current sell-off in tech stocks is somehow related to what we’re seeing with the cryptos.

Indeed, the macro-economic story incorporates all assets and looking at the long-term graphs, we can spot clear similarities between these two seemingly unconnected markets.

This chart shows the movements of bitcoin (in blue) against the Nasdaq 100 (purple) since the beginning of 2017.

The year 2017 was an exceptional year for high risk assets, including cryptos and tech stocks. In 2018, we’re seeing is a retracement of that.

When prices reach levels that are higher than can be justified, they need to pull back and so the cycles continue. It’s important to note that over this time the Nasdaq is still up 30% and Bitcoin, well… you can see the percentage in blue on the above chart.

It isn’t possible to time the markets to a T, so every person needs to take the decision if they’re an investor or a trader. If you’re trying to catch each and every small move, it can prove to be difficult, especially in times of uncertainty such as these. For long-term investors, results are usually much more predictable.

What’s Causing this?

The simple answer is that everything we’re seeing across all markets is still the aftermath of the 2008 financial crisis.

The world’s governments and central banks have pumped very large amounts of money into the system over the last 10 years in order to stabilize the financial system. Much of this money has by now found its way into various markets, often times with little research on the part of the investor as to what the value of the assets should logically be.

With this in mind, it’s important to note that a lot of this cash is still on the sidelines looking for a home. So, whenever these markets do find themselves their respective bottoms, there’s still a mountain of capital that could potentially be put to work. The only question that nobody can answer with certainty is exactly where those bottoms may be.

If things turn around now, it would certainly be a very bullish sign, but it’s also entirely possible that this could last a while longer.

No News is Good News

Despite what many are claiming, my view is that current news events are only having a limited impact on prices at this time.

The current scandal surrounding the auto tycoon Carlos Ghosn, CEO of Renault, has certainly influenced short-term pricing in the automotive sector, but it’s only a very small piece of the larger macroeconomic story playing out above.

Same goes for the Bitcoin Cash Hard Fork and crypto, and OPEC with crude oil. These developments do influence short-term sentiment but are still not the main drivers.

Sometimes people get so wrapped up in finding a story to go with a movement that they misinterpret the new entirely. A great example of this is the SEC ruling that came out on Friday, which many have blamed for the current price action.

If you read the ruling, you’ll notice that this new update brings a lot more clarity than we previously had, and should be serving to bolster confidence rather than tearing it down.

The fact that the SEC chose to settle with AirFox and Paragon is a clear sign that the US authorities are taking a supportive stance towards blockchain startups. Here’s an excerpt from the document.

Consider what this might mean for XRP for example. It’s very possible that the SEC could come out and say, that it is an illegal unregulated security, hand them a fine, have them compensate any outstanding claims, and then they could very well be allowed to register as a security and continue their business.

Of course, we can’t pretend to know how things are going to play out, but this is why it always pays to diversify our investments and think long-term.

Let’s have an amazing day ahead!

This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation.

Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose.

The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro.

eToro is a multi-asset platform which offers both investing in stocks and cryptocurrencies, as well as trading CFD assets.

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

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 135 rated postsSenior Market Analyst at Etoro.com.




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Analysis

Forex Analysis And Chartbook: Tech Selloff Resumes, Dollar Dips Again, as Yields Hit 2-Month Low

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Monday Market Snapshot

Asset Current Value Daily Change
S&P 500 2,697 -1.62%
DAX 30 11,244 -0.85%
WTI Crude Oil 56.76 -0.12%
GOLD 1,224 0.21%
Bitcoin 4,989 -10.26%
EUR/USD 1.1452 0.32%

While all eyes were on the cryptocurrency segment today, as the major coins continue to fall sharply, traditional financial markets have also been very active before Thanksgiving. The last days have been dominated by the strong rally in US Treasuries (a dip in yields, in other words) which carried the yield curve to a 2-month low today, due to Jerome Powell’s dovish words, global growth worries, and European worries regarding the Brexit process and Italy.

EUR/USD, 4-Hour Chart Analysis

The Dollar has also been feeling the effects of the falling Treasury yields, and after hitting a more than one-year high against the Euro this month, the Greenback fell to its lowest level in almost two weeks.  The long-term uptrend is not in danger in the pair and in the broader Dollar index, and with no higher swing high in the EUR/USD even the short-term downtrend is intact. That said, should the pair remain above the 1.1440 level, a short-term trend change could be ahead.

Nasdaq 100 Futures, 4-Hour Chart Analysis

US stocks had an ugly day despite a quiet overnight session which was helped by the continued optimism in China, in the face of the diplomatic disaster on the APEC summit. The meeting ended without a formal communiqué for the first time ever, due to the US-Chinese spat that took another turn when US Vice President Mike Pence attacked China on several issues, dampening hopes of a quick resolution to the dispute before the looming Trump-Xi meeting.

The major indices finished sharply lower after a steep morning selloff on Wall Street and the Nasdaq got very close to its October lows due to the weakness in some of the largest tech names such as Apple (AAPL) and Facebook (FB).

While both stocks fell on bearish news, with the report on a significant iPhone production- cut being the most worrying one, the selloff in the key momentum names is a more structural problem, which is likely the sign of the broader bearish shift that we have been following in recent months.

While the year-end cold still holds a stronger bounce, thanks to seasonality and a possible positive turn in the US-Chinese relations, we will still view all rallies as selling opportunities in equities.

Gold and Copper Edge Higher Amid Dollar-Dip

Gold Futures, 4-Hour Chart Analysis

Commodities had a bullish session thanks in part to the Greenback’s weakness, but gold, copper, and oil were also helped by very different reasons too. While gold benefited from the bearish intraday shift in risk assets, crude oil continued its oversold bounce after a brief spike towards last week’s low, while copper was boosted by the stability in Chinese assets.

The precious metal is holding above the key short-term $1215 level, and although bulls are still not out of the woods following this year’s selloff, a move above the October highs would be a very positive sign for the commodity, which we still view as one of the top picks for the coming years.

Copper Futures, 4-Hour Chart Analysis

Copper is still trading in a broad consolidation pattern, despite the rally of the past days, which was sparked by trade optimism. The long-term fundamentals remain hostile for the industrial metal, given the global slowdown, and especially the state of the Chinese economy, so even in the case of a move above the formation long positions should only be considered for trading.

That said, the short-term outlook is rather neutral, as the year-end could see feel-good risk rally (with copper possibly bouncing as high as $3), even as we expect the commodity to continue its broader downtrend.

ChartBook

Major Stock Indices

S&P 500 Futures, 4-Hour Chart Analysis

Dow 30 Futures, 4-Hour Chart Analysis

VIX (US Volatility Index), 4-Hour Chart Analysis

DAX 30 Index CFD, 4-Hour Chart Analysis

FTSE 100 Index CFD, 4-Hour Chart Analysis

EuroStoxx50 Index CFD, 4-Hour Chart Analysis

Nikkei 225 Futures, 4-Hour Chart Analysis

Shanghai Composite Index CFD, 4-Hour Chart Analysis

EEM (Emerging Markets ETF), 4-Hour Chart Analysis

Forex

USD/JPY, 4-Hour Chart Analysis

GBP/USD, 4-Hour Chart Analysis

EUR/GBP, 4-Hour Chart Analysis

AUD/USD, 4-Hour Chart Analysis

Commodities

WTI Crude Oil, 4-Hour Chart Analysis

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 398 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

Tech Rollover Sinks U.S. Stocks; Bitcoin Falls Below $5,000 as Collapse Continues

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U.S. stocks booked huge losses on Monday, as plunging tech shares and wavering risk sentiment dragged the major indexes lower. The crypto bloodbath reached epic proportions Monday, as bitcoin slid below $5,000 for the first time since October 2017.

Stocks Lurch Lower

All of Wall Street’s major indexes headed for sharp losses, with the S&P 500 Index virtually erasing its yearly gain. The large-cap index fell 1.7% to 2,690.73, with nine of 11 primary sectors finishing in the red.

The S&P 500’s information technology component plunged 4%, with software, technology hardware and semiconductors shouldering the heavies loses. Communication services, a partial offshoot of big tech, fell 2.8%.

The tech-heavy Nasdaq Composite Index sold off 3% to close at 7,028.48.

Dow industrials were down across the board, with the Dow 30 index closing down 395.54 points, or 1.6%, to 25,017.68.

Tech Rollover Intensifies

The major tech titans that once led the bull market are buckling under the pressure of disappointing earnings forecasts and slowing global growth. Shares of Apple Inc. (AAPL) fell back into bear market territory on Monday amid reports the company was slashing production orders for its flagship iPhone products.

According to The Wall Street Journal, Apple has cut orders for the iPhone XR, XS and XS Max models by a third, signaling weak demand. The upgrades were unveiled in September around the time Apple was continuing a record-setting surge that culminated in a trillion-dollar market cap. Since reaching those peaks, the iPhone maker has lost more than $200 billion in market value.

The tech rollover on Monday extended far beyond Apple. Netflix Inc. (NFLX), Advanced Micro Devices Inc. (AMD), Facebook Inc. (F) and Amazon.com Inc. (AMZN) all posted major losses.

Plunging tech shares are usually a warning sign that investors are losing confidence in the bull market. The sector was largely responsible for the record-setting bull run that followed the election of Donald Trump in November 2016.

Crypto Carnage Intensifies

Bitcoin and the broader cryptocurrency market headed for new 13-month lows Monday, extending last week’s bearish breakdown. The bitcoin price pierced below $4,900 on Coinbase, levels not seen since October 2017. The leading digital currency is down a whopping 12% on the day and 22% compared with seven days ago. Over the course of the week, its market cap has plunged from $110 billion all the way down to $86.7 billion.

With the exception of XRP and the dollar-backed USDT stablecoin, all major cryptocurrencies in the top-ten posted double-digit losses on Monday. Losses among the majors ranged between 16% and 34% week-on-week. The combined crypto market cap, which includes bitcoin and altcoins, plunged to $164 billion. At the time of writing, the cryptocurrency market cap was worth $166 billion.

There’s no telling just how deep the correction goes, though technical traders have identified $4,800 as a major inflection point for the bitcoin price. The selloff, which appears to be technical in nature, was sparked last week in anticipation of the bitcoin cash hard fork.

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 670 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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