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Market Overview

The Fomo is Back

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Hope you’re having a fantastic day so far. All the markets went up yesterday for a special Valentines Day miracle.

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The FOMO is back with a vengeance and though we’re nowhere near the peak FOMO levels seen in November we can clearly see that the FUD is fading fast and markets are getting excited once again.

Bitcoin is looking ready and willing to bust through 10k, possibly today. If it does indeed manage to do that, we may never look back.

That said, the usual disclaimers apply. These are super high-risk assets so any cryptocurrency should not take up more than a small part of your overall portfolio.

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Today’s Highlights

  • Inflation is Coming
  • Chikun Leading the Way
  • XRP on Western Union

Please note: All data, figures & graphs are valid as of February 15th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

There are two types of FOMO in this world. Healthy and unhealthy.

I must say that the FOMO in the stock markets yesterday was more than a bit concerning. The inflation numbers that every analyst and their brother were so hyper-focused on came out way above expectations showing that inflation is coming to the United States at a rapid pace.

The initial reaction in the stock markets was down as expected, but what happened next was a total surprise. Once the lows were in, things started rising as Wall Street moved in to buy the dip.

Even more confusing is the reaction from the US Dollar. The conventional thinking is that higher inflation would cause the Fed to hike rates faster, which in turn would strengthen the Buck.

Just like the stocks, the initial response was as expected and the Dollar rose sharply on the announcement. However, just a few short minutes later the Dollar started falling and continued to fall all the way until this morning.

Here’s the USDJPY. The announcement is circled in yellow.

The only reaction that really made sense was in the bond market. Here we can see the yield on the US 10 Year surging at the market open and rising until the close.

So now the question becomes… If the markets are skyrocketing after this huge inflation data came out, then what the heck really caused the sell-off over the last two weeks?

Chikun Leading the Cryptos

All the cryptos are firmly in the green today but none quite as much as Litecoin. The world’s first and most established bitcoin spinoff is up almost 60% over the last 7 days, half of which happened in the last 24 hours.

Here we can see a nice clean breakout in both the long term (blue) and short term (yellow) trendlines…

Though some are still speculating over the reasons for this massive rally, we can point to three main factors.

  1. A scam hard fork called Litecoin Cash seems to have duped some. The founder of Litecoin himself has denounced this fork on Twitter but that may not have stopped some from trying to get in anyhow.

  1. A new service called Litepay is planning to launch a product that will make it easier for business to accept the altcoin. Though this announcement is a bit old, it may still be spurring speculation.
  2. The FOMO is friggen back in the market!

Crypto investors have been sitting on their hands for weeks waiting for a rally, so as soon as they saw one starting they jumped on and and are currently riding it for all it’s worth.

XRP Strikes Back

One more neat announcement that’s adding to crypto-enthusiasm today is a new pilot by the global fund transfer powerhouse Western Union.

Whilst many new pilots announced by Ripple Labs lately do not use the XRP tokens, this one will.

That means both Moneygram and Western Union are now testing out XRP to do their cash settlements and currency transfers.

Imagine the possibilities. I’ll let you guys draw the lines on this chart but I’d like to see a moon in there somewhere.

More Fun

Yesterday, my counterpart in the UK and I had a fun hangout live on YouTube. You can catch the recording here: https://youtu.be/d2N08RCB788

If you’d like to see more of this type of stuff or if you’d like to participate in one, let me know!!

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.

eToro (EU) Ltd, authorized and regulated by the Cyprus Securities Exchange Commission (CySEC)

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.

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4.6 stars on average, based on 69 rated postsSenior Market Analyst at Etoro.com.




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1 Comment

1 Comment

  1. tommudd

    February 15, 2018 at 11:31 pm

    I really enjoy this information. I would like to know if anyone knows if Bittrex will support bitcoin private after the ZCL hard fork on the 28 of Feb?

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Analysis

Pre Market: Dollar Pulls Back from 7-Week High as Stocks Rebound

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Global equities are attempting to rally after drifting lower for three sessions, with Asia leading the bounce thanks to rumors regarding possible monetary easing steps in China. The rumors surfaced on the heels of the Yen’s plunge which followed Bank of Japan governor Kuroda’s dovish words. Mr. Kuroda is worried about the stubbornly low inflation rate, and hinted on a delay of the ”normalization” process of the central bank’s monetary policies.

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USD/JPY, 4-Hour Chart Analysis

As a reminder, the BOJ now owns the majority of the stock ETFs in Japan, but we might reach a point where it will own the whole float (why not?), while also technically controlling the whole Japanese government bond “market”. Meanwhile, the Euro also got under pressure lately thanks to the string of negative economic surprises and Mario Draghi’s cautious words regarding growth, and with Thursday’s ECB meeting looming, forex traders could be in for a very active week of trading.

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EUR/USD, 4-Hour Chart Analysis

The Dollar reached a 7-week high against the Euro yesterday, while the Dollar index closed at the highest level since January, and although the Greenback is correcting the recent rally today, it seems that the growing number of Dollar bears might be in for more pain after a likely short-term correction, as Treasury yields continue to rise relentlessly.

US 2-Year Treasury Yield, 4-Hour Chart Analysis

Stocks are having a relatively quiet week so far, but the bearish trend of the recent sessions remains dominant despite today’s bounce, even as volatility is still low, and trade war fears and geopolitical tensions have been easing somewhat lately. We switched to a bearish bias last week, and we maintain that the stocks look vulnerable here, although the short-term overbought readings have been cleared.

S&P 500, 4-Hour Chart Analysis

Bulls still have the hope that the major US indices can resume the recovery and launch a rally towards the all-time highs, but unless we see a quick move above last week’s highs, bears remain in control, and another test of the correction lows is likely.

On a slightly positive note, European equities enjoyed some relative strength in the last couple of days, as they were boosted by the weakness in the Euro, but looking at the broader picture, the Old Continent continues to be among the weakest regions globally since the start of the correction.

Commodities Mixed but Commodity Currencies Still Weak

AUD/USD, 4-Hour Chart Analysis

Interestingly, the Aussie and the Canadian Dollar are still under selling pressure today, despite the risk rally, and that fact strengthens our short-term bearish view on stocks, as they have been reliably leading equities since February.

In the meantime, commodities have been trading in a choppy fashion amid the Dollar rally, as gold has been pushed back below $1330 again, continuing its lengthy consolidation phase, while crude oil slightly retreated from its multi-year high near the $70 per barrel level concerning the WTI contract.

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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4.5 stars on average, based on 231 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 Overview

Takes a lot of GUTS – Making Blockchain Mainstream

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Take a guess… What do all of these people have in common?

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They all have Ethereum wallets and don’t even know it.

The new GET protocol is designed to use blockchain as an engine and run seamlessly in the background without the end user ever knowing what powers the application.

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The GUTS ticketing app is the first mainstream application to use GET and the people in the above photo are the first 1000 users. It’s estimated that more than 1 million people in the Netherlands will use it to securely purchase tickets without the fear of scalpers.

Welcome to the future!

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Global Selloff Pauses for Earnings
  • EOS is now available in eToro!
  • Cryptocurrency Future in India

Please note: All data, figures & graphs are valid as of April 24th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

The global stock rout that we’ve been seeing since early February is seemingly on hold for the time being.

Earnings season is going great, and why wouldn’t it? Donald Trump’s recent tax cuts and economic stimulus seem to be spurring the economy and adding to corporate profitability as designed.

Some economists, like Alice Rivlin of the Brookings Institute, argue that all this stimulus is coming at the wrong point in the economic cycle. Usually, countries try to stimulate the economy when it is doing poorly but when it is doing well they want to tighten things up and save the surplus for a rainy day.

As long as earnings are good, stocks should rise. The question then is what happens when earnings season is over?

The Nasdaq100 has managed to defend its position at the 200 day moving average (blue) and has since rallied a bit but it doesn’t seem like we’re quite out of the woods just yet.

Introducing EOS

eToro is very proud to announce that we have added EOS as the tenth cryptocurrency available on the platform. Of the 2000+ assets that you can trade on the platform this one is one of the most interesting.

If Bitcoin is digital gold and Ethereum is digital oil, EOS has been likened to digital real estate.

The ICO is ongoing and set to last an entire year ending on June 1st, 2018. In the end there will be a total of 1 Billion EOS in the world.

By owning EOS one token you are entitled to one billionth of the computing power of the total network. Unlike other utility tokens, EOS are not burned in the transactions. So owners will be like landlords of their space on the network.

Proponents say that this is the next level for blockchain after Ethereum and is designed to be an operating system for decentralized applications. With it, developers will be able to create apps that utilize blockchain without the end user ever knowing the intricacies of the supporting technology.

The price is up 17% since the asset has been added on the platform and up more than 100% over the last month knocking out Litecoin for the number 5 slot of all cryptocurrencies by market cap.

As with all cryptos, EOS is still in the experimental phase and as such carries a significant degree of risk.

Always diversify your portfolio with many different types of assets and not just cryptocurrencies, please.

Cryptos in India

Lastly, I’d like to thank those users yesterday, especially in India, who quickly replied to clarify a tweet I sent out regarding the RBI’s decision to ban cryptocurrencies.

To be clear, the high court has given the RBI 48 hours to respond to the claim that their new policy is unconstitutional. This happened on Sunday so their response is actually due today.

Unfortunately, this isn’t over just yet and from what it seems the court could take further time to sort this out. We hope for a quick and positive resolution in this high stakes case.

A reminder to ever rely on a single source of information. Always do your own research. 😉

Have an excellent 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

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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Market Overview

Market Update: Stocks Pare Losses as U.S. Dollar Hits Three-Month High

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U.S. stocks declined for a third consecutive session Monday, while the dollar jumped to three-month highs as 10-year yields approached 3% for the first time since 2014.

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Stocks Mostly Lower

Equity markets traded mixed-to-lower at the start of the week, with the S&P 500 Index paring losses in the final moments of trade. The index closed at 2,670.29, where it was little changed for the day.

Five of 11 S&P 500 sectors finished in negative territory, with information technology falling 0.4%. On the opposite side of the spectrum, telecommunications services rose 1.1% and energy added 0.6%.

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Declining tech shares weighed on the Nasdaq Composite Index, which settled down 0.3% at 7,128.60.

Meanwhile, the Dow Jones Industrial Average slipped 14.25 points, or 0.1%, to close at 24,448.69. The blue-chip index was down as much as 134 points earlier in the day.

The decline in stocks appears to have been triggered by a steep rise in bond yields. The 10-year Treasury note peaked at 2.99%, threatening to hit 3% for the first time since January 2014. Yields have been rising as investors offload Treasurys on expectations of rising inflation. A yield at or above 3% may signal a downturn in the stock market.

Dollar Hits Three-Month High

Rising yields drove the U.S. dollar to its highest level since January.

The dollar index (DXY), which measures the greenback’s performance against a basket of six peers, rose 0.7% to 90.93. Monday’s performance allowed the dollar to trim its year-to-date decline to -1.3%. At its lowest point, the dollar was down nearly 4% for 2018.

Against the Japanese yen, the dollar surged 1% to overtake the 108.00 level for the first time since February.

The euro, pound and Canadian dollar all fell versus the greenback.

Currency speculators are calling for the Federal Reserve to raise interest rates three times this year. Analysts at Goldman Sachs believe a fourth interest rate hike is also on the table.

Busy Week for Earnings

Investors are also bracing for the busiest week of the Q1 earnings season, with 170 companies scheduled to report results. Some of the most prominent names include Verizon (VZ), Travelers Cos (TRV) and Visa (V), which are all Dow blue chips.

Google-parent Alphabet (GOOGL) report quarterly earnings Monday, beating analysts’ expectations on both the top and bottom line. The company earned $9.93 per share on revenue of $31.15 billion. Analysts had called for EPS of $9.28 on revenues of $30.29 billion.

Corporate earnings have come in largely ahead of expectations over the past two weeks. According to FactSet, 80% of S&P 500 companies that have reported so far have posted positive earnings surprises. Combined, their blended earnings growth rate foe Q1 2018 is 18.3%.

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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4.5 stars on average, based on 348 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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