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Hi Everyone,

The drive for crypto regulation continues across the globe with successes and setbacks for crypto-enthusiasts ongoing in different key markets.

In the USA, President Trump has appointed a new chairman to the SEC who is reportedly much more crypto friendly than his predecessor. Elad Roisman could very well tip the scale in favor of a bitcoin backed ETF and other crypto financial products.

In California, where I grew up and have just returned from, the law has been amended to include new definitions for crypto assets.

In the European Union, the EcoFin meetings have also proven fruitful

One setback that we’ve seen though, came from the International Monetary Fund, which has come out against the Marshall Islands’ plans to create their own cryptocurrency, known as the Sovereign.

However, the biggest debate continues. India’s hearing on the RBI’s infamous crypto ban has rolled over into today and we hope to get some good news there.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Asian Stocks Down
  • EM Currencies Rebound
  • Ethereum Sell-off

Please note: All data, figures & graphs are valid as of September 12th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

The mood among investors in Asian stocks is arguably grimmer than the crypto market at this point, as Asian stocks are currently in the longest sell-off of the last 16 years.

This rather clever headline compares the market cap of the Chinese stock market to that of the world’s largest corporation.

Here we can see the China 50 index, which is down 28% from its peak at the start of the year.

EM Currency Rebound

The Dollar seems to have levelled off recently. Over the next few days, we’ll get key updates from several central banks but the US Fed’s next big meeting is still two weeks away.

Still, today we’ll hear remarks from two Fed reps, Brainard and Bullard, as well as receiving insight from the Fed’s beige book, a bond auction, and even some PPI data for gauging inflation. However, all of the above events could easily be overshadowed by Apple’s big conference in Cupertino California tonight.

The company has become so big that its stocks are being seen by some as the go-to store of value investment, and as we’ve noted above a global benchmark. So these type of product launches may end up influencing other markets.

Related or not, we can also notice a bit of a bounce in the emerging markets currencies this morning.

Crude oil is also gaining against the Dollar today on news of two massive storms that are about to hit land, one in the United States and one in East Asia.

Ethereum Based Sell-off

Much to the chagrin of many crypto-enthusiasts, the bear market has continued over the last few days, with Ethereum seemingly leading the charge.

The general direction of the market is pretty clear, but it remains a mystery is why Ethereum is losing ground faster than most other major crypto assets.

Perhaps it could have something to do with statements from Vitalik Buterin…

The fact that Vitalik is less bullish could be causing some to sell and it stands to reason that most of his most devout followers will be holding Ether.

Either way, Vitalik’s statement that “there’s a ceiling in sight” doesn’t necessarily imply where that ceiling might be. At this point, even if we simply return to all time highs, it would represent a massive growth in price from where we currently are. My question isn’t about the ceiling, it’s about the floor.

Here we can see Ethereum’s massive 88% decline since the high on January 13th.

The fact remains that Ethereum is the most widely used blockchain with the most projects built on top of it and consistently sees the highest number of transactions per day. So despite the lower price, we have reason to believe that the Ethereum network and token are here to stay.

Let’s have an awesome 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.

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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Analysis

Pre-Market: China Bear Market Deepens as Shares Hit 4-Year Lows

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Global stocks and other risk assets started the week with slight losses so far, and the recently weak segments continue to struggle, while US markets are still acting relatively strong, suggesting the continuation of the recent trends. European markets are among the weaker ones again, even after last week’s bounce, with the major benchmarks all being around 10% off their highs, in stark contrast with their US peers.

Shanghai Composite, 4-Hour Chart Analysis

With all eyes on the second round of US tariffs directed to China, it’s no surprise that the pressure on the Shanghai Composite didn’t ease yet, and the benchmark slid to yet another almost 4-year low this morning. The Chinese Yuan is holding on well in the meantime, with the August low being in no danger, as of now.

USD/TRY (Turkish Lira), 4-Hour Chart Analysis

That said, emerging market currencies are back in the crosshairs, with Argentinean Peso, the Brazilian Real, and the Turkish Lira all drifting in early trading.  The Lira, which got a boost from the emergency 6% rate hike by the local central bank last week, is headed towards pre-rate hike levels, and that doesn’t bode well for the coming weeks with regards to Turkish and other emerging market assets.

Dow Futures, 4-Hour Chart Analysis

Economic releases will be few and far between this week compared to last week’s busy calendar, and today, only the Empire State Manufacturing Index made some waves, missing the consensus estimate, and suggesting a slowdown in the recently well-performing US segment. The final CPI in the Eurozone didn’t cause any surprises, coming in at the originally reported 2.0% annualized rate. The Dow, the Nasdaq, and the S&P 500 all opened slight below Friday’s levels after the releases, but the more interesting moves are in Forex markets.

Dollar Declines Against Majors as Commodities Mixed

DXY, 4-Hour Chart Analysis

After Friday’s bounce, the Dollar couldn’t maintain its momentum and today, the reserve currency is lower against most of its global peers, with the Dollar index sliding towards its July lows. With the Fed’s next rate hike just around the corner, the current move is more the product of Mario Draghi’s inflation warning, which is pushing the Euro higher since Thursday’s ECB meeting.

From a longer-term perspective, the Dollar’s strength could be undermined by the Trump administration’s pro-cyclical fiscal expansion, at least against the majors, but until the US economy keeps on booming, we expect bulls to be in control of the Greenback’s market.

Gold, 4-Hour Chart Analysis

Commodities are trading without a clear direction today, with copper following Chinese stocks lower, maintaining the strong correlation, while gold and crude oil are slightly higher. The WTI crude contract is edging towards the $70 per barrel price level again, still trading within a narrowing range, while the main precious metal is also stuck near the $1200 level following a four-month-long decline.

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 348 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 News

Coinbase Explores Adding Dozens of Altcoins for Custody, XRP Included

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Leading U.S. cryptocurrency exchange Coinbase is mulling the expansion of its custody platform to include approximately three dozen altcoins, a sign that it is anticipating more institutional investor capital. Among the coins being added to custody is XRP, which investors have anxiously been awaiting access to on the exchange’s trading platform. But Coinbase made clear that “this announcement has no bearing on trading-based products,” leaving traders back where they started in their push for greater access.

Coinbase walks a slippery slope with the addition of new assets, as it was blamed for alleged insider trading in the rollout of Bitcoin Cash. In the custody announcement, the exchange carefully worded its actions, maintaining that it “has not yet considered these assets for trading.” A list of the digital currencies that Coinbase wants to add can be found here in an announcement by Coinbase Custody Product Lead Sam McIngvale.

Coinbase can’t be too careful, as even today The Wall Street Journal reported about scams that affecting trading on major cryptocurrency exchanges, including the likes of Binance, the Journal story reveals. According to their analysis, which involved scouring “trading data and online communications among traders,” nearly 200 pump-and-dump schemes involving $825 million in trades unfolded across more than 100 coins in 2018 through July 31.

It’s a type of scam that the U.S. SEC has warned investors about, and the Journal documents an apparent quick and sharp increase in the price of coins followed by a similarly sharp and quick decline. Trading groups like Big Pump Signal are reportedly using popular crypto platforms like Telegram to pump a little-known coin, after which time the curious trading begins.

Coinbase Lack of Effect

Clearly, Coinbase’s announcement did little to bolster the mood of the broader cryptocurrency market, which has been trading in the doldrums all weekend. One of the standout altcoins has been Ethereum Classic (ETC), which is only up fractionally in the last 24-hour period but yesterday was up by a double-digit percentage. Coinbase is in the midst of testing the integration of ETC onto its trading platform, which is something traders want more of and are willing to celebrate.

Meanwhile, reports earlier this year revealed that Ripple was trying to buy its way onto U.S. cryptocurrency exchanges Coinbase and Gemini to no avail. While regulators cleared bitcoin and Ethereum from being designated as securities, they stopped short of including the third largest cryptocurrency in their decision, which suggests that they may be leaning toward a security classification for the coin in which Ripple is the majority investor.

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 60 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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Market News

EOS Is Targeting ‘50,000 Tx per Second’: Mike Novogratz

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EOS in recent days unveiled the latest version of EOSIO, which is V1.1.0. The release comes on the heels of a botched mainnet launch in June that left many believers doubting the project’s ability to deliver what it promises – scalability and speed for decentralized applications. But if you ask billionaire trader Mike Novogratz, who is at the helm of merchant bank Galaxy Digital, the EOS blockchain protocol, which is designed for enterprise applications, has only scratched the surface of its potential.

“It’s already doing 5,000 transactions a second. It should be doing 50,000 transactions per second in a few months,” Novogratz told TheStreet.com.

Novogratz, who previously ran nearly $9 billion in assets under management at Fortress, pointed to EOS’ unique delegated proof of stake, which was created by BlockOne CTO Dan Larimer (who is also behind Steem Blockchain and Bitshares). EOS has fewer than two dozen block producers, which combined with their “big computing power behind them” is what sets EOS apart from competing blockchains, Novogratz says.

EOS is the maiden project of Block.one, the latter of which Novogratz partnered with earlier this year for a $325 million EOS.IO Ecosystem Fund to be directed toward projects on the EOS platform. So he has a vested interest in seeing it fulfill 50,000 transactions per second. Scalability is a front-and-center issue for blockchains currently, with the Ethereum network targeting sharding and Bitcoin pursuing SegWit and the Lightning Network.

It’s been weeks since the EOS mainnet launch, and since that time the EOS coin hasn’t really impressed investors. While the EOS team boasts scalability and speedy transactions, the mainnet launch took longer than many investors were anticipating, which triggered a selloff in the EOS coin to its current price of approximately $8. But if EOS could bolster the number of transactions per second, that is the type of development that could send the EOS price back to its range of $13-$14 leading up to the mainnet launch.

Source: CoinMarketCap

EOS is the No. 5 cryptocurrency based on market cap. Stellar (XLM), however, which recently muscled Litecoin out of the way for the No. 6 spot, has momentum on its side. Stellar is the platform of choice for IBM to launch its USD-backed stablecoin. As a result, XLM, today’s modest declines notwithstanding, has seen its Relative Strength Index (RSI) soar to record levels this year. Still, XLM is hovering at a market cap of $5.4 billion compared to EOS at $7.2 billion. If EOS could recapture the confidence of investors, say with achieving 50,000 transactions per second, it won’t have to keep looking over its shoulder at XLM.

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 60 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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