Connect with us

Market Overview

Finding a Golden Opportunity

Published

on

Hi Everyone,

Yet another attack struck the cryptocurrency market recently, this one claiming around $18 million from the Bitcoin Gold network.

The innovation of blockchain is that transactions are secured by utilizing the power of the network. The second major fork of Bitcoin, known as Bitcoin Gold or (BTG), is not on the eToro platform at the moment, precisely because the network is simply not big enough at this time.

Both BTG and Bitcoin Cash (BCH) were created to give Bitcoin a larger block size, an idea that the Bitcoin Core community rejected. With all the thousands of cryptocurrencies out there, the question arises, how many bitcoin forks do we actually need?

In this video from earlier this week, you can see the backers of Bitcoin Gold arguing with a well-known backer of BCH Craig Wright. The video ends with the BTG spokesperson saying to Craig “goodbye Fake-Toshi” a disapproving nickname that he received for previously claiming to be the real Satoshi Nakamoto.

Even though BTG seemed to come away with the upper hand in the video, it’s losing against BCH on the ground.

In the graph below, we can see the total mining power (hashrate) of all three Bitcoin tokens mentioned above (BTC, BCH, and BTG). As you can see, BTG is simply a flat line at the bottom, indicating that there are very few miners actually supporting the network.

The distinct lack of miners left the network vulnerable to attack and the hackers were easily able to add enough hashrate to write the blocks however they like.

It should be noted that even though BTC enjoys the most hashrate by far, BCH actually has marginally lower fees. This is why people keep saying that Bitcoin is moving to be more of a store of value.

So if payments is the question, we need to look at the top three contenders. In this case that would be Bitcoin Cash, Litecoin, and Dash. As you can see, in the last few months, the competition has been getting tight, with all three coins charging less than 20 cents per transaction.

Ultimately, the natural way of the market is to push out the weakest contenders. For now, the payments market is dominated by Visa & MasterCard, who at the moment are charging vendors about 2.5% to 3% per transaction.

As the average credit card transaction is about $80, the average fee comes out to approximately $2.20, which is more than 5 times higher than Bitcoin itself.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Trump Pulls Out
  • Happy GDPR Day
  • Vitalik is Tweeting again!

Please note: All data, figures & graphs are valid as of May 25th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

A big part of my job and the job of other financial bloggers is to try and gauge the impact of any given news event on actual market prices. When doing this, it’s important to always remember that correlation does not equal causation.

A perfect example would be this news that came out yesterday…

The purple circle on this chart shows the exact time that the news broke on Bloomberg.

As is clear from the chart, the market has been falling for several days, and though there was a spike down shortly after the announcement, it would be difficult to prove that the news caused the movement.

On the other hand, there was an event yesterday that I believe did have a direct and measurable impact on the markets. Here we can see Donald Trump’s letter to Kim Jong Un announcing that he was calling off their June 12th Singapore meeting.

For your convenience, I’ve pinpointed the exact time that the letter went viral on social media on this chart of gold.

Even though the price spiked before the announcement it does seem that this little event was able to give it the strength to push the market above the $1,300 psychological barrier.

The news also seems to have had an impact on the global stock indices as depicted here.

Final Fantasy

With all the news and simultaneous stories coming out right now, it’s difficult to pinpoint exactly which ones translate into investment opportunities.

For example, the Brexit saga in the UK right now doesn’t seem to have changed much for the Pound. Yes, the British Pound sold off against the US Dollar, but the USD is getting stronger across the board. If we look at the Pound’s strength against the Euro, we can see that little has changed in the last few months.

We are getting ever closer to the March 2019 Brexit though, so we hope things are sorted out pretty soon. In any case, we should get more clarity soon when the Brexit Bill is back in front of the UK Parliament.

New Spending Government

Over to Italy, where earlier this week we saw that the new Prime Minister has been confirmed by the President. So Italy should soon have a government. Even though it’s clear that the new parliament will try to increase spending in a country that has more than its fair share of debt, it seems that what’s happening in Italy is staying in Italy, at least as far as the global markets are concerned.

Roll-Back

Yesterday the Trump administration did a huge roll-back of the Dodd-Frank regulations, which were put in place by Obama to prevent another crisis similar to 2008.

The immediate impact will probably be that medium-sized banks will be free to take on more risk. Wheather this will end up increasing systemic risk of the entire system is currently being debated, but even if it does, that’s not something that would usually cause an immediate impact on the markets, that’s “future America’s” problem.

Happy GDPR Day!!

I’d like to wish you a very happy GDPR day!! Please enjoy the abundance of emails informing you that the privacy policy of just about every company that holds your personal data has been updated. Good luck reading through it all.

This is something that might impact the market over the next few weeks because it’s been reported that many companies are still not fully compliant. The market impact will largely depend on how EU officials choose to deal with these type of infractions.

TRY Time

The Turkish Lira has been almost as volatile as many of the major cryptocurrencies over the last month. So if you like high risk, feel free to day-trade it. Just please be cautious and use proper money management.

Increased Chatter (Vitalik is Tweeting)

For traditional markets, more chatter means a conference happening in Stockholm, which will include a panel with both Fed Chair Jerome Powel and the Governor of the Bank of England Mark Carney. This is about as good as it gets for central bank watchers and is not to be missed.

In crypto, it’s relevant to note the Ethereum community is having a lot more open dialogue lately on Twitter. As a decentralized platform, they’ve always been rather transparent about their conversations.

Vitalik likes to remain silent though for fear of having too much influence over the direction of the network. Over the last few months, he’s been especially hands-off and limiting himself to only retweets, presumably to emphasize a point made in the original tweet.

In the last few days however, it seems that he’s been engaging a lot more directly, especially with people contributing to the development of the Ethereum network. The community has been waiting for the famous Casper upgrade that will take Ether to a new level. Lately’ we’ve heard that the code for this upgrade has already been written and is currently in final review. Let’s hope for a smooth release.

Long Weekend

Really sorry for the long winded email. I hope that the information here will help you make better decisions in your portfolio, especially going into the long weekend.

For those of you in the UK and USA, I want to wish you a happy holiday in advance and to everyone a wonderful weekend!

For anyone who got through the entire post. Feel free to tag me, you probably deserve some sort of prize. 🙂

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

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
8 votes, average: 4.75 out of 58 votes, average: 4.75 out of 58 votes, average: 4.75 out of 58 votes, average: 4.75 out of 58 votes, average: 4.75 out of 5 (8 votes, average: 4.75 out of 5)
You need to be a registered member to rate this.
Loading...

4.7 stars on average, based on 105 rated postsSenior Market Analyst at Etoro.com.




Feedback or Requests?

2 Comments

2 Comments

  1. DAPPerD

    May 25, 2018 at 4:37 pm

    Sure, the post is a little long but it’s a good perspective on a lot of news items that are colliding right now. I enjoyed it.

  2. Mati Greenspan

    May 25, 2018 at 5:22 pm

    Thanks Bro & Well done!! You’ve earned an honorable mention that will be etched forever on my Twitter timeline.

You must be logged in to post a comment Login

Leave a Reply

Market Overview

Fed Tests Big Banks & Adds Support for Crypto

Published

on

Hi Everybody,

Every year since the financial crisis the Federal Reserve creates a simulated crisis to see which banks are healthy enough to survive in the event of an emergency.

The tests were particularly difficult this year because the economy is doing well, but it does seem that a few U.S. banks passed by the skin of their teeth.

Here we can see the results for some of the top banks.

It’s important to note that this simulation is not indicative of a real world situation. Next week the Fed will perform a few more tests that should give us a better understanding of the situation.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Greek Debt Deal
  • Win for Mom & Pop
  • Fed Adds Ethereum

Please note: All data, figures & graphs are valid as of June 22nd. All trading carries risk. Only risk capital you can afford to lose.

Greek Debt Deal

The negotiations have been going on for far too long and have brought the markets to their knees several times already. Today the crisis has finally been declared over.

Though the Greeks didn’t get anything close to the deal that Prime Minister Alexis Tsipras advocated in his famous 2015 election campaign, they did win a number of concessions from the European Union that will make it easier to operate the country and start borrowing money from the public again.

Much of the €96 billion owed will be pushed back by 10 years, which should allow the country to breathe and grow the economy in the meantime.

The Euro is gaining a bit of ground this morning on the news (purple circle), although hasn’t quite recovered from Draghi’s announcement last Thursday.

Win for Mom & Pop

A landmark case has now passed the US Supreme Court that could have an impact on your portfolio going forward.

Until now, online stores in the United States were exempt from local sales taxes in states where they do not have a physical presence.

Bricks and mortar stores claim that they have been disadvantaged by this for the last 25 years. Some even say that this has been a major contributing factor to the retail apocalypse of the last decade.

Going forward, online retailers will be subject to the same taxes that everyone else is, which should level the playing field a bit, but won’t necessarily reverse the online shopping trend.

The clear winners here are the state governments because they’re about to get billions more in tax revenues. This may be a good time to look at the stocks you’re holding as bottom lines for both online and offline retailers will be affected by this.

Fed adds Crypto

While many old school financial institutions see cryptocurrencies as a threat, the Federal Reserve Bank of St. Louis is extremely supportive of them.

They have already released a significant amount of research detailing how the introduction of a new form of decentralized money can have a stabilizing effect on the global economy.

This week, the Federal Reserve Economic Data (FRED) website, run by the St. Louis Fed, has taken a massive step towards legitimizing cryptocurrencies in the eyes of the financial world by adding price tracking graphs for Bitcoin, Bitcoin Cash, and Ethereum, and Litecoin.

Here’s bitcoin on FRED…

…and Ethereum


Though the United States has been more skeptical about ICOs lately, they’re certainly looking a lot more friendly towards the more established cryptocurrencies.

What Else?

Remember that today is the much anticipated OPEC meeting. Watch for volatility in crude oil throughout the day.

Also, the Turkish elections will be held on Sunday. A month ago this looked to be a clear win for Erdogan the incumbent. Today, the scales have tipped just a little showing a slightly more favorable outlook for the opposition. Don’t get your hopes up too much though. Just keep an eye on the USDTRY.

Wishing you and yours an outstanding weekend 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,

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
1 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 5 (1 votes, average: 5.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.7 stars on average, based on 105 rated postsSenior Market Analyst at Etoro.com.




Feedback or Requests?

Continue Reading

Analysis

Italy Spooks markets Again as Stocks Remain Under Pressure

Published

on

European stocks Led the way lower today despite a bullish start in Asia, as equities gave back their gains when Daimler published a surprising profit warning, which was deeply affected by the recent trade war developments, reigniting fears of a tariff-driven downturn in global trade.

DAX, 4-Hour Chart Analysis

The Old Continent got into more trouble later on, when two anti-EU officials were named in Italy, resurrecting fears of a clash between the systematically crucial country and the core of the Eurozone. Italian yields rose in European trading, and although they are still shy of the levels hit during the May scare, the periphery could be in trouble as the ECB pledged to exit the market by the end of the year.

Nasdaq 100 Futures, 4-Hour Chart Analysis

The main European indices were smashed lower during the session, with the DAX hitting a two month low, still being very weak relatively speaking compared to its US peers. US stocks sold off heavily following the opening bell and they failed to recover, unlike two days ago, and the major benchmarks traded well below yesterday’s levels just before the close.

The Nasdaq and the Russell 2000 lost some of their recent mojo, pulling back heavily of the all-time highs during the day. All in all, the risk off shift continues to dominate across the board, as we expected and we remain negative on risk assets here, especially regarding emerging markets, even as the Dollar’s rally could be over for a while.

Dollar Pulls back as Pound Surges

USD/CAD, 4-Hour Chart Analysis

The Dollar took a beating as the Philly Fed Index came in much worse than expected, and as the Bank of England sent hawkish signals, pushing the Pound and the Euro higher. The central bank left its benchmark rate unchanged at 0.5%, but a rate hike this year got much closer, with a key member of the bank voicing inflationary concerns.

The Greenback fell more than what the events would imply, so a larger scale consolidation could have already started in the currency following the recent gains and the marginal new high yesterday. With the EUR/USD pair nearing the 1.1450-1.15 support zone, the USD/CAD hitting 1.33 and the AUD/USD touching 0.7350, a meaningful counter-trend move would be timely in the surging reserve currency.

WTI Crude Oil, 4-Hour Chart Analysis

Gold continued to drift lower before the Dollar’s reversal and it hit $1262 for the first time since lat December before bouncing back above the $1270 level in late trading. Crude oil also fell sharply in early trading, and the WTI contract traded with a $64 handle before rallying back to $66 per barrel.

The OPEC meeting, which is expected to result in a supply increase by the cartel made the crucial commodity very volatile in recent days, but we expect the bearish trend to continue, with a likely dip to the $60 level in the coming weeks.

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 280 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.




Feedback or Requests?

Continue Reading

Market Overview

Market Update: Dow’s Slide Hits Eight Days as Trade Risks Reemerge 

Published

on

U.S. stocks retreated Thursday, with the Dow Jones Industrial Average extending its losing skid to eight days as uncertainty over international trade undermined risk appetite.

Stocks Turn Defensive

Dow industrials were off 196.10 points, or 0.8%, by the close to settle at 24,461.70. That was the index’s worst settlement in three weeks.

The Dow’s losing skid is now the longest since March 2017. Another fall on Friday would bring the skid to nine days, the longest since 1978.

The broader S&P 500 Index fell 0.6% to close at 2,749.76. Seven of 11 primary sectors fell, led by energy and other commodity-sensitive sectors.

Meanwhile, the Nasdaq Composite Index closed down 0.9% at 7,712.95. The technology-heavy average closed in record territory on Wednesday.

Investor fear over a U.S.-China trade rift returned on Thursday, sending the VIX Volatility Index sharply higher. Wall Street’s gauge of investor anxiety climbed to a session high of 15.18 on a scale of 1-100 where 20 represents the historic average. The index would later settle at 14.68 for a gain of more than 14%.

Trade War Looms Large Over Market

U.S.-China trade tensions were back in focus Thursday after U.S. policymakers urged Google to end its business ties with Huawei, a leading Chinese smartphone maker. Congress recently banned U.S. firms from selling products to Chinese telecommunication giant ZTE, a move that practically shuts down the company.

Under President Trump’s orders, Washington announced last Friday it would implement a 25% tariff on up to $50 billion of Chinese goods, including semiconductors. Trump says additional tariffs of 10% will be applied on $200 billion of Chinese goods should Beijing choose to retaliate.

The first round of tariffs will come into force July 6.

In theory, tariffs will make American-made goods cheaper than imported ones, thereby encouraging consumers to purchase from local producers. Importers themselves will have to pay an additional tax on certain Chinese products they bring into the country – costs that are passed on to the consumer.

Saudi Arabia Proposes Crude Output Hike Ahead of OPEC Meeting

Saudi Arabia, OPEC’s de facto head, is encouraging fellow producers to support a deal that would see oil production rise by one million barrels per day. However, Iran remains the key holdout in the deal, with the country’s energy minister suggesting that a compromise is unlikely before the cartel meets Friday.

Despite Iran’s opposition, the biannual meeting in Vienna is expected to result in the first coordinated output hike since the cartel decided to constrain supplies all the way back in 2016.

The Saudis are banking on a slowdown in U.S. shale production over the next two years until pipeline bottlenecks are solved in the energy-rich Permian Basin, energy minister Khalid al-Falih said Thursday.

International crude prices declined sharply on Thursday, with Brent futures reaching a session low of $72.94 a barrel on London’s ICE Futures exchange. The global benchmark was last down $1.57, or 2.1%, at $73.17 a barrel.

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 465 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.




Feedback or Requests?

Continue Reading

10 of 15 Seats Available

Learn more here.

Recent Comments

Recent Posts

A part of CCN

Hacked.com is Neutral and Unbiased

Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

Trending