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Bitcoin

Green but Not Green Enough

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Hi Everyone,

Forget the Winklevoss twins and their COIN ETF. The CFTC in the USA has just approved the first Bitcoin derivatives trading and clearing platform known as Ledgerx.

By the early Fall, investors in the United States will be able to buy options on Bitcoin and within a few months after, Ethereum.

This is really good news for cryptocurrency traders and investors as it will provide some much needed additional liquidity to this new market.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

More record low volatility

Yellen Tomorrow

OPEC’s Position

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

Market Overview

Say it isn’t so…

Stock market volatility hit another all time low.

That’s two days in a row!

Why won’t these equities go??

For the first time ever, here’s the VIX hitting 9.26…

Needless to say, global stocks are mixed with nothing really moving in any specific direction. The direction is coming from the currency markets with the U.S. Dollar getting pummeled.

Here we can see the relative performance since the beginning of the year. Everything is green, except the greenback.

Who can save the poor buck?

While Donald Trump and his family don’t seem to be making any headway on promises to reform health care and cut taxes, there’s something else fundamentally pushing the Dollar down.

Expectations are setting in that the next rate hike from the Fed won’t come until March. And, subsequent hikes don’t even seem to be on anybody’s agenda at this point.

Lately, the Fed has been telling us that by selling off some of their extremely bloated balance sheet they should be able to have the same effect as raising rates.

Tomorrow, Janet Yellen will announce the interest rate decision, which of course is extremely unlikely to be adjusted. Ms. Yellen will not appear in front of the camera and there is no press conference at this meeting.

We may see some muted volume in preparation of her prepared statement, but it’s really hard to imagine volatility going much lower than it already is.

Oil Market

The meeting in Russia yesterday did meet its intended result but not in the way people were expecting. They had dismissed concerns about increased production in Libya and Nigeria by saying that these countries were rapidly reaching max capacity anyway and that capping them is not a priority.

Instead, OPEC decided to reassure the market that they are on top of things by signaling that they have their finger on the pulse, so to speak. They stressed to investors that what they’re doing now should be enough but that if things turn sour and prices drop that they can respond relatively quickly.

This brazen display of confidence did indeed move prices upward by about $1 a barrel. However, the rise yesterday was just shy of covering the previous day’s fall (circled).

Wishing you an amazing trading day ahead.

This content is provided for information and educational purposes only and should not be considered to be a 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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4.6 stars on average, based on 133 rated postsSenior Market Analyst at Etoro.com.




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Bitcoin

Volatility Ahead For Bitcoin Price as Global Trade Volumes Drop Sharply

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The global cryptocurrency trade volume took a sharp dip on Saturday evening, falling by half a billion in just five hours. The fall from $10.5 billion to $10 billion pushes the global total closer to yearly lows, and could be a sign that volatility is just around the corner – be it for good or bad.

Falling Trade Volumes

The decline in trade volumes hadn’t made itself felt in the global market cap at the time of writing, as Bitcoin and the majority of altcoins continue to trade sideways.

But for how much longer? Every time global volumes have dipped to the $9 billion mark in the last few months, it has been accompanied by either a tremendous market surge, or terrible market dip.

When a market loses trade volume, it becomes very easy to manipulate. This can be seen most easily among various altcoins in the lower ends of the market cap rankings every day.

As for Bitcoin, its own trade volumes dropped from $3.7 billion to $3.4 billion. The last time any real volatility hit BTC was when trade volumes dropped below the $3 billion mark. That applies to Monday’s Tether-induced spike; it applies to the 40% spike seen in July of this year, and it also applies to the 15% flash dip that struck in mid June.

BTC/USD

In the previous twenty-four period leading up to Saturday evening, BTC continued to trade in a remarkably tight range. Opening the day at $6,400 and closing the same twenty-four period at $6,400 has been the case for almost a month and a half now.

The occasional rise to $6,700 and dip to $6,200 means BTC has traded within a $500 range for the last fifty or so days, and marks one of the least volatile periods in Bitcoin’s history.

The same can be said for most of the major altcoins, except those which had major breakouts based on promising news and developments. As of Saturday evening (UTC), every coin the market cap top twenty except two recorded less than a 1% swing either way for the day.

Only Zcash (ZEC), which is hotly anticipating the enactment of its upcoming Sapling hardfork, and IOTA (MIOTA) – which is making headlines for its supposedly imminent move into Venezuela, have recorded clear gains of any kind.

As it stands, BTC appears to have found a fairly reliable level near the $6,000 range – which it hasn’t fallen below since October of 2017, almost a year ago exactly. At the current price, BTC could afford to take another 5% flash dip and still be holding strong near $6,000, although the subsequent hit on the altcoin market would be more severe.

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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4.4 stars on average, based on 81 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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Analysis

Crypto Update: Market Still in Deadlock

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The choppy, directionless period in the cryptocurrency segment continues, with no meaningful change in the technical setups of the major coins. While the broader trends are still clearly bearish and sellers remain in control of the market, we saw another minor bullish shift in the past 24 hours, with modest gains across the board.

Most of the top coins are trading in the range of the Monday session, which saw the spike triggered by the turmoil in Tether. Stellar is the apparent positive outlier of the past few days, while Dash, Litecoin, and Ethereum have been the weakest so far this week.

DASH/USD, 4-Hour Chart Analysis

On a positive note, all of the majors remain above last week’s levels, and especially Bitcoin’s continued stability is encouraging for crypto-bulls here, even as our trend model paints a negative picture of the segment.


BTC/USD, 4-Hour Chart Analysis

Bitcoin avoided a test of the $6275 level despite moving below its recent very narrow trading range yesterday, with still no meaningful bearish or bullish momentum present in the coin’s market. BTC continues to trade below the $6500 level, and its volatility is very low, even after the move below the previously dominant broad triangle consolidation pattern.

Further resistance levels are still ahead near $6750 and $7000, while support levels below $6275 are found near $600, $5850 and between $5000 and $5100.

Altcoins Little Changed as Ethereum Still Glued to $200

XRP/USD, 4-Hour Chart Analysis

The weekend has been very quiet for altcoins so far, with even the recently active Ripple settling down near the $0.46 level. XRP is around the midpoint of Monday’ s range but the lack of follow-through after the breakout from the triangle consolidation pattern is a negative sign, and the coin remains on a short-term sell signal in our trend model. Strong resistance is still ahead at $0.51, $0.54, $0.57, while support is found near $0.42, $0.375, and $0.35.

ETH/USD, 4-Hour Chart Analysis

Ethereum continues to hover around the $200 price level still being in bearish short- and long-term patterns and the relative weakness of the second largest coin remains a huge concern for the whole segment.

With no evidence of meaningful capital inflows to the market, the outlook is neutral at best, and traders and investors should wait for at least a short-term trend change before entering new positions. Strong support is found near $180, $170, and $160, while resistance is ahead near $235 and $260.

EOS/USD, 4-Hour Chart Analysis

EOS is also among the relatively weaker coins, and the coin is stuick in a broad Trading range around the $5.35 level since August. Volatility in the coin’s market has been progressively declining, but the vicinity of the bear market low suggests that the long-term downtrend is still intact, especially given the segment-wide trends.

A test of the lows is still more likely than a bullish break-out, with strong support found near $4.50 and key resistance ahead near $6 and $6.5.

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

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 380 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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Bitcoin

Bitcoin Price Showing Little Upside as Trade Volumes Approach Yearly Lows

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Bitcoin resumed its sideways action on Saturday, as declining trade volumes kept price action subdued following a minor dip during the previous session. The leading digital currency is showing little signs of recovery after bouncing off a psychological support on Friday.

BTC/USD Update

Bitcoin is currently changing hands at $6,483, according to CoinMarketCap. Prices were little changed compared with the previous session. BTC fluctuated within a $50 range on most exchanges, though Bitfinex was reporting a $100 range from peak-to-trough. The digital currency continues to trade at a $100+ premium on Bitfinex.

The bitcoin price briefly fell below $6,400 on Friday before rebounding later in the session. It has held above that psychological threshold for the past 24 hours.

Trade volumes are down another 5% on Saturday, a continuation of a pattern first observed on Tuesday. Bitcoin’s price and trade volume skyrocketed on Monday as traders liquidated their holdings of USDT, a controversial stablecoin used to buy digital assets. BTC trade volumes averaged $3.5 billion on Saturday, according to latest available data.

Bitcoin and Stocks

Widely regarded as an emerging haven asset, bitcoin has been unable to capitalize on the recent collapse in global stock prices. This has led many in the investment community to temper their expectations that BTC offers a risk-off alternative to equities. Although bitcoin and U.S. stocks have shown some signs of correlation recently, this isn’t enough to justify the claim that investors are hedging their bets with cryptocurrency. At the same time, gold prices have risen sharply amid the selloff, with the December futures contract hitting fresh three-month highs.

Investors often mistaken bitcoin’s status as non-correlated asset with inverse correlation – meaning, they expect BTC to rise when stocks fall and vice versa. This isn’t generally what we mean by “non-correlated asset.”

When we say bitcoin is non-correlated, we mean its price does not move in lockstep with the broader market nor is it influenced by the same technical and fundamental factors that drive stocks, bonds, currencies and so on. This lack of correlation has been promoted as a safe haven for investors looking to diversify away from traditional market risks, but that doesn’t mean they’ve taken up the offer.

This also doesn’t mean that cryptos like bitcoin aren’t influenced by investor sentiment or fundamental drivers – they most certainly are. However, bitcoin’s fundamental drivers have proven to be different from those that drive equities. For example, BTC does not react to economic data or central bank decisions, whereas stocks and currencies certainly do.

Understanding the difference between non-correlation and inverse correlation becomes more important as stock markets enter a more volatile stage in their development. While U.S. stocks have managed to bounce back after multiple selloffs this year, China remains a major source of risk. The benchmark Shanghai Composite Index is down 12% this month and 23% since Jan. 1.

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 648 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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