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Promises Surprising Promises

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US President Donald J Trump certainly has his fair share of critics. Even I myself am sometimes one of them. There is one thing though that he has not misled us about and that is economic growth.

The new President has promised us a steady growth rate of 3% and the numbers out on Friday have demonstrated that despite hell and high water, floods and fires, and a multitude of other obstacles, the economy has fulfilled that promise on his behalf.

The significance of this report along with the jaw dropping revenue announcements from the US’s biggest tech firms has sent the stock markets to the moon.

@MatiGreenspan
eToro, Senior Market Analyst

Please note that there will be no daily market update tomorrow. Myself and about 250 other eToro employees will be taking a short field trip for some much needed R&R. We will resume on Wednesday, November 1st.

 

Please note: All data, figures & graphs are valid as of October 30th. All trading carries risk. Only risk capital you’re prepared to lose.

Market Overview

The world’s largest financial institution may soon be changing ownership.

Even though central banks are supposedly separate from the government and unconnected to politics, the very nature of their business binds them to each other.

One example is the way in which Fed Bosses are chosen. When Janet Yellen’s term ends as the Governor of the US Federal Reserve, there will not be any national election to find a replacement. Rather, the President of the United States will be the one to nominate her successor. The nominated candidate will need to be vetted by Congress before being sworn in, but at that point his or her appointment is almost certain.

Trump’s administration has been mulling the decision over for several months now and according to reports are very likely to announce shortly that Jerome Powell will take over.

Powell has been on the Fed’s Governing Board since 2012 and is expected to be the best person to continue Yellen’s work on “normalizing” monetary policy and more importantly he is expected to be the best person for the roaring stock markets.

As earnings season slows down to a trickle, market participants are more likely to be focusing again on the Fed and their international counterparts and look to them for direction.

Japan

If the Fed in the US is expected to continue their path to normal monetary policy, their friends in Japan are doing just the opposite.

After PM Shinzo Abe’s sweeping victory in the national elections the Bank of Japan now has a full mandate to continue on their path to printing money and forcibly devaluing the Japanese Yen.

Until now they’ve been focused on creating money in order to buy Japanese ETFs but they may be running out of assets to buy.

As of February, the BoJ owned about two thirds of the ETFs in Japan…

According to some sources, in the past few months, their holdings have grown to 75% of the entire market.

Of course, this is unsustainable. You can’t have a free and fair market in which the central bank is holding most of the assets.

Also, the Bank of Japan is still experimenting with negative interest rates. Currently, anyone holding funds at the BoJ needs to pay 0.1% a year in negative interest. Even though many other central banks around the world are trying to raise these rates, Japan is not expected to do so for quite some time.

The market is currently giving the possibility of a BoJ rate hike in one year from tomorrow at just 33%.

The good news is that this white line is rising and that at least the markets are starting to belive that it eventually will happen.

Tomorrow morning, BoJ Governor Haruhiko Kuroda will give the interest rate decision, followed by a press conference.

In my view, this meeting has a very large chance of delivering a surprise to the markets. They do need to switch their strategy quite soon before they’ve bought up all the assets in the country and now that Abe has the power to do as he pleases, the timing is right to double down or back off their plan to send the Yen to the floor.

Japanese Traders

In Japan, day trading is a way of life. Candlestick charts were invented there as was the Ichimoku Cloud and several other technical analysis indicators.

Lately, they’ve moved on to a new asset that’s a bit more volatile than the Yen. Now they’re trading Bitcoins.

The Bank of Japan, possibly in an effort to weaken the Yen, has legalized Bitcoin completely in April and since then many major stores, websites, and supermarkets have started accepting payments in the digital currency.

In September, the country’s BTC monthly volume reached a record of 6.5 Million coins, which is roughly 70% of the entire market.

Over the weekend, the price of Bitcoin reached a new all-time high of $6,281 per coin so the number one chart today that most traders will be looking at is this one.

It will be interesting to see if the BoJ does indeed end up with a surprise tomorrow how fast traders will switch their screens to the USDJPY.

Of course, the nature of a surprise is that nobody is expecting it. So most likely they’ll simply continue on their path to buying out the market, cutting their nose off to spite their own currency. But it always pays to be prepared.

Wishing you an amazing week 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.

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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Altcoins

Minor Bounce Lifts Crypto Market Cap Above $211 Billion; Tether Circulation Plummets

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Crypto prices traded modestly higher on Sunday, as bitcoin regained its footing above $6,500 and major altcoins avoided further losses.

Market Update

The cryptocurrency market capitalization on Sunday peaked at $212 billion, the highest in five days. At the time of writing, the market was valued at $211.5 billion.

Most assets ranked in the top-20 had reported minor gains over the last 24 hours, a period marked by lower trade volumes. The bitcoin price has returned above $6,500 on trade volumes of just $3.2 billion. The leading digital currency continues to trade at a premium on Bitfinex.

Meanwhile, Ethereum rose half a percent to $206. XRP also climbed 0.5% to $0.459. Bitcoin cash was last seen trading above $449 for a gain of 1.6%.

Stellar XLM was the only top-ten coin not to report gains at the time of writing. However, the no. 6 coin by market cap has returned more than 13% over the past week, far outpacing the broader market.

Trade volumes have declined steadily over the past week, as markets re-balanced following a sudden spike on Oct. 15. Digital exchange volumes have fallen to $9.7 billion on Sunday, according to CoinMarketCap.

Tether Market Cap Plunges

Since the start of October, Tether has pulled more than $600 million worth of USDT out of circulation, leading to a sharp drop in the stablecoin’s market cap. Cryptocurrency exchange Bitfinex, which is run by the same executive in charge of Tether Limited, appears to be leading in the offload of USDT tokens. As CCN recently reported, Bitfinex has initiated six transfers of USDT funds to the Tether Treasury this month. The latest transfer was initiated on Wednesday when Bitfinex sent 50 million USDT to the Treasury.

Most of the outflows from Bitfinex occurred long before USDT lost its peg to the dollar in a single-day crash on Oct. 15. USDT briefly fell below $0.90 that day before quickly recovering around $0.94. Currently, one USDT is equivalent to $0.984 U.S., according to CoinMarketCap. Some exchanges are quoting USDT as low as $0.96 on Sunday.

The sudden decline in Tether’s circulation comes at a time when the company is facing heightened scrutiny over its dollar-backed reserves. An influx of alternative stablecoins offering greater transparency and regulatory oversight may also be undercutting demand for USDT.

Case in point: the Gemini Exchange’s GUSD stablecoin reached a high of $1.19 on Tuesday before settling around parity against the dollar. Unlike USDT, the Gemini Dollar has obtained regulatory approval from the New York Department of Financial Services. On the opposite side of the spectrum, Tether has been subpoenaed by federal regulators over its connection with Bitfinex and failure to prove its dollar reserves.

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 649 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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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 82 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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