Breakout Imminent

Hi Everyone,

Huge congratulations to Canada for becoming the second country in the world to fully legalize marijuana!

This is a huge milestone for this fascinating industry and in my personal opinion is long overdue. I hope that in the next few years many more countries will open their respective markets to this exciting field.

Unfortunately, the @CannabisCare copy portfolio on eToro is closed for investing now but there are other options to invest for those of you who are interested.

For example, you can click this link to see the marijuana stocks that are available on the eToro platform. Or, you can check out the HMMJ ETF, which tracks the North American Marijuana market.

Of course, the usual disclaimers apply and always diversify!!

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Breakout Stocks
  • Breakout Bonds
  • Breakout Bitcoin

Please note: All data, figures & graphs are valid as of October 18th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

Volatility begets volatility. At least that’s the word on financial media lately. It’s been an entire week since the broad stock market sell-off and though we’ve seen a bright bounce from the bottom, things are far from normal.

The US indices have been the quickest to “recover” and as we can see, they’ve recouped almost half the losses from the top.

This is likely due to the monetary policy in the United States which is currently sucking up the wealth of the world. Higher interest rates are a big incentive for foreign investors to store their wealth in American assets.

As we can see, other markets aren’t nearly as far off the lows…

Bond Watch

As you’ll recall, the start of volatility this year came in February and it was largely attributed to rising bond yields. So we do need to keep a close eye on these.

In the USA, the 10-year yield is once again on the rise and threatening to break new highs. Yesterday, we saw another solid leg up…

The level to watch out for now is 3.25…

In Italy, where we are awaiting some potentially sour news from Brussels, the 10-year yield is also sitting at the highs and could very easily breakout from here.

When Bitcoin Breakout?

It’s only a matter of time now. Of course, the flatline pattern could easily remain for another few months and that wouldn’t be a bad thing, however, there are signs of excitement boiling underneath the cool price action exterior.

First off, the transaction rate has been rising steadily. Here we can see Bitcoin’s average transactions per second (TPS) rate, which has been growing steadily during the stable market conditions. This is a classic indication that we’re nearing the end of the flat cycle.

Along with the TPS rates, volumes across exchanges has reportedly remained at a steady rate of around $10 billion daily for several months now. A figure that is exponentially higher than it was just 18 months ago.

Last and foremost, and this is what I wanted to highlight today, volumes on Wall Street are growing at a rapid pace.

The CME Group has reported yesterday that the volumes on their Bitcoin futures contracted have ticked up by a massive 41% in the third quarter of 2018.

This massive surge in interest doesn’t even include the last 18 days where we’ve seen the historic update that Fidelity Investments is joining the market.

Let’s have an awesome 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.

Best regards,
Mati Greenspan
Senior Market Analyst

Connect with me on….

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

Author:
Senior Market Analyst at Etoro.com.

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