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Cherry on Top

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Hi Everybody,

Very glad to announce that we have a new cryptocurrency that is now available for trading on the eToro social trading network…

Please welcome the newest member of the crew… XRP!

This revolutionary new system aims to completely replace the current SWIFT system used by banks for international transfers. A bank to bank transfer these days usually takes between 2 and 5 business days. Ripple, can do it in seconds flat … and at a much cheaper rate too.

Ripple has been one of the hottest and fastest moving cryptocurrencies since the beginning of the year with swings from 0.006 cents per token in January, up to 42 cents in mid-May, and now sitting at 17 cents per token.

This is the magic of crypto and we’re very pleased to offer it for both long term investing and short term trading on our network.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

Apple’s Cherry

Markets Stable

Bitcoin Cash

Please note: All data, figures & graphs are valid as of August 2nd. All trading carries risk. Only risk capital you can afford to lose.

Market Overview

Apple shares have placed a cherry on the top of what was already a cream filled day in the financial markets. The Dow Jones industrial average is now just a few points shy of the landmark level of 22,000 points.

Analysts were thinking that the smartphone and tablet giant was in for a terrible quarter ahead of the expected release of their next wave of new tech, which many believe is due in September. Usually, iPhone users tend to hold onto their old and broken devices just a little longer if it means upgrading to a new version.

Not only did they smash those expectations, their share price skyrocketed in after-hours trading and when the markets open today the largest company in the world will be worth an approximate $782 Billion.

Other markets, currencies, and commodities remained relatively stable yesterday as the VIX volatility index once again took a dive.

Crypto World

Everybody is buzzing about Bitcoin Cash and the hard fork that just took place. The smoke is just clearing now but the transition is far from over, or even guaranteed at this point.

So for now, let’s look at what we know. The old Bitcoin network seems to be stable. SegWit is locked in and volumes are looking quite normal. In the past 24 hours approximately $1.3 Billion worth of BTC has exchanged hands, a number which is quite average for the past few months and the market cap of bitcoin is about the same as it’s been since May at about $44.6 Billion.

The new coin, Bitcoin Cash, which some exchanges label as BCC and some as BCH, is now the third largest crypto with a market cap of $7.2 Billion as the coins currently trade at $439 a pop.

Ladies and gentlemen, this is not anything like your average stock split. When the shares in a company split, each investor gets 2 shares for every 1 he holds and the price per share is reduced by 50%.

With this split, the value of the original asset was never reduced. We simply have a new asset with a completely new market cap that seemingly came from nowhere. Meaning, that the combined value of bitcoin and bitcoin cash is now $51.8 Billion, which is well above what bitcoin ever achieved by itself.

Given the growth of this explosive market, it would not be surprising to see either one or both of these assets growing exponentially in value from here. Or to see either one surrender to the other.

We’re in the thick of it now. 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.

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.

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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4.7 stars on average, based on 122 rated postsSenior Market Analyst at Etoro.com.




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2 Comments

2 Comments

  1. Matt_a

    August 2, 2017 at 9:51 am

    Trading on CFDs on Etoro without having the chance to use leverage makes no sense at all. You better buy the real coin directly and at least you remove the counterparty risk. Beside that..if anyone would be trading these coins using CFDs the price won’t go anywhere given that it is not affecting it in any sort…Etoro removed all the possibility to leverage so don’t waste your time with it and buy the real coin

  2. Mati Greenspan

    August 2, 2017 at 11:04 am

    Hi Matt,

    Thanks for the honest feedback. It’s highly appreciated. To address the issue of CFDs. eToro is indeed backing our positions by placing an order on the underlying asset, such that the volumes in eToro do indeed impact the market just as they would on any of the exchange sites.

    In addition, trading as a CFD provides you as the customer with an additional layer of liquidity as we guarantee the same price for large orders as we do for small ones as well as instant execution at the price you see on your screen. Such that you don’t need to look for a counterparty to the trade.

    The last point is that eToro unlike many other places to buy cryptos direct is a regulated financial institution. A CFD (contract for difference) is a contract which is legally binding and has ramifications much greater than an irreversible transfer from one digital wallet to another.

    Feel free to reach me on the world’s best social investment network any time with any further questions, comments, or concerns.

    -Mati Greenspan

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Analysis

Platinum Update: Faces Life or Death Showdown

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The Platinum/US Dollar (XPT/USD) pair has been in a decade-long downtrend. In July 2008, the pair broke out of a double top pattern on the weekly chart after taking out support of $1,850. There were numerous attempts to reverse the trend and break out of the slump. However, every single effort was denied as bears held $1,850 resistance. As a result, XPT/USD is now trading around $800.

While bears seem to have the upper hand, there’s a case for a bullish reversal. In this article, we explore the bearish and bullish scenarios for the XPT/USD pair.

The Bearish Case for Platinum

In technical analysis, the prevailing trend remains until there’s a clear sign of trend reversal. As mentioned, XPT/USD is still in a downtrend. The downtrend was recently confirmed by a breakout from sideways consolidation on the daily chart in June 2018.


XPT/USD daily chart

The breakout quickly brought XPT/USD down to $800 support. While bulls are managing to hold on, it appears that their mettle will be tested soon.

Large Descending Triangle on the Monthly

The descending triangle is often a continuation pattern with a bearish bias. The lower highs of this pattern put enormous pressure on the support that it eventually snaps. We see this pattern emerging on the monthly chart of Platinum/US Dollar.

XPT/USD monthly chart

The pattern is enormous. It is large enough to keep many retail investors on the sidelines. From the looks of it, XPT/USD appears to have just completed the E-wave or the final dead cat bounce. With a new lower high in place, bulls are in for the fight of their life at $800.

The Bullish Case for Platinum

The good news for the bulls is that not all descending triangles are bearish. Sometimes, bulls use the price compression at the apex to take out the resistance.

The key issue to understand is that the pattern must be triggered first. If bears take out $800, then the market sinks deeper. If bulls breach the resistance, then that might just be enough to kickstart a bull run.

Double Bottom on the Monthly

If bulls win this battle, then many investors will look at the possibility of a double bottom reversal pattern on the monthly chart.

Possible double bottom of XPT/USD

The preservation of $800 support amidst the threat of a huge descending triangle paints a bullish picture. It should send a reverberating message that $800 is bull territory. This would attract all types of investors and may generate sufficient momentum to push the market back up to previous highs and create a double bottom reversal pattern.

Bottom Line

Bulls and bears are bound to have a showdown at the $800 support level. Whoever wins this fight gets to control the market in the coming months or even years. Bears have the upper hand but it looks like bulls have what it takes to pull out one big surprise.

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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3.6 stars on average, based on 223 rated postsKiril is a financial professional with 4+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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Commodities

Gold Price Is Getting Crushed as Dollar Reaches New 2018 Highs

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Gold’s brisk selloff deepened Thursday, as investors put higher interest rates on the front burner following two days of testimony from Federal Reserve Chairman Jerome Powell.

Gold Price Levels

According to Bloomberg data, the price of gold bottomed at $1,212.70 a troy ounce on Thursday, extending a three-month selloff that has shaved 11% from the yellow metal’s value. Gold peaked slightly above $1,360 in March and April before plunging over the next three months.

Bullion is trading at its lowest level in over a year, with technical charts putting the next major support level around $1,200-$1,202 an ounce.

Silver, which often trades in the direction of gold, was off more than 2% Thursday to a low of $15.19 a troy ounce. The grey metal later recovered around $15.30 but was still down more than 12% from January’s settlement high of $17.61.

Dollar Rally Intensifies

A surging dollar has largely underpinned the massive exodus out of gold over the last three months. The U.S. dollar index (DXY), which tracks the performance of the greenback against a basket of currencies, has gained nearly 7% compared to three months ago. DXY is up 3.6% for the year, more than offsetting its worst annual start in decades.

On Thursday, the dollar index rose more than half a percent to a high of 95.65, its best level of the year.

The dollar’s strength combined with Brexit woes triggered a fresh slide in the British pound, which fell on Thursday to its lowest since August.

The Canadian dollar declined sharply on tariff fears, sending the USD/CAD currency pair to its highest level of the month.

A stronger U.S. currency makes the purchase of gold and other commodities more costly for international buyers, which reduces their relative demand. On Wall Street, investors have shown a renewed penchant for stocks in anticipation of a strong earnings quarter.

Fed Chairman Jerome Powell on Thursday wrapped up his semiannual testimony before Congress where he fielded questions on the economy, protectionism and cryptocurrency. Although Powell didn’t strike an overly hawkish tone, he left little doubt about the central bank’s plan to raise short-term interest rates.

On Wednesday, Powell told lawmakers they can expect several years of economic growth under the current policy regime.

“With appropriate monetary policy, the job market will remain strong and inflation will stay near 2% over the next several years,” Powell said in prepared remarks.

The central bank “believes that – for now – the best way forward is to keep gradually raising the federal funds rate” in a way that keeps pace with the economic recovery, he added.

Federal Open Market Committee (FOMC) members will next meet July 31-Aug. 1 to set short-term interest rates. No change is expected before September.

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 551 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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Commodities

Oil Prices Plunge as Saudi Arabia Prepares Record Output

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Oil prices declined sharply Monday amid reports that Saudi Arabia is heeding to President Trump’s request to keep the energy market well supplied. OPEC’s kingpin is stepping up its contractual obligations to key Asian markets amid disruptions from Venezuela and Libya, among others.

Oil Prices Drop

Crude futures in New York and London were down more than 4% on Monday. U.S. West Texas Intermediate (WTI) contracts for August settlement bottomed at $67.92 a barrel on the New York Mercantile Exchange, the lowest in nearly a month. Prices would later consolidate at $68.11 a barrel for a decline of $2.90, or 4.1%.

ICE Brent futures for September delivery bottomed at $71.80 a barrel, the lowest in three months. It was last down $3.16, or 4.1%, at $72.17 a barrel.

Saudi Arabia Ramping Up Production

Bloomberg reported Monday that the Saudis are planning to offer extra crude volumes to some of their Asian buyers less than a month after Riyadh convinced fellow OPEC members to crank up daily production levels.

Saudi Arabian Oil Co. has offered extra cargoes of its Arab Extra Light crude to at least two buyers in Asia, Bloomberg said. If approved, the additional supplies will be shipped for August.

Last month, the Organization of the Petroleum Exporting Countries agreed to raise production by 600,000 barrels per day, paving the way for an eventual 1 million-barrel-per-day increase for the cartel and its allies. The Saudis are planing to pump at record levels to offset supply disruptions elsewhere.

OPEC’s secondary sources indicate that the Saudis began ramping up production before the biannual meeting in Vienna on June 22, where cartel members agreed to ease supply restrictions. According to the data, Saudi Arabia boosted its daily output by 405,400 barrels in June compared with May.

Riyadh is also looking to pick up the slack from Iran, which faces renewed sanctions after U.S. President Donald Trump pulled out of the 2015 nuclear deal. The Saudis are said to be targeting crude output at 10.8 million barrels per day, the largest on record.

Trump Succeeding in Reining In Oil Prices

President Trump has criticized OPEC’s policies and has called on producers to raise their output in order to cap runaway price growth.

“Oil prices are too high, OPEC is at it again. Not good!” Trump tweeted in June. Earlier this month, he said: “The OPEC Monopoly must remember that gas prices are up & they are doing little to help. If anything, they are driving prices higher as the United States defends many of their members for very little $’s. This must be a two way street. REDUCE PRICING NOW!”

With political pressure to rein in oil prices intensifying ahead of the midterm elections, the Trump administration has announced it is considering tapping the nation’s emergency crude supply. The Strategic Petroleum Reserve currently houses a total inventory of 660 million crude barrels, though options under review suggest that figure is between 5 million barrels and 30 million barrels lower.

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 551 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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