Daily Market News: China to steady its currency?

forex market crypto news and updates

Mati Greenspan, Senior Market Analyst at FX broker eToro, has provided his daily commentary on traditional and crypto markets for August 8, 2019. The text below is an excerpt and does not contain the full analysis.

Today’s Highlights

  • Markets Bounce Back: Today’s price action slightly resembles the rally that we’ve experienced earlier this year, when markets were convinced that President Trump could force the Fed into an easing cycle.
  • China to Steady its Currency? Markets are temporarily comforted by China doing their part to stymie the yuan’s descent rather than encourage it, but further volatility could be on the horizon.
  • BTC Volumes on the Rise: Messari’s real 10 volume is above $2 billion a day for the first time in weeks while the bitcoin blockchain is once again seeing 4 transactions per second.
  • Altcoin that Refuses to Bleed: Bitcoin is dominating while altcoins struggle, however, Binance Coin managed double-digit growth over the past 24 hours.

Please note: All data, figures & graphs are valid as of August 8th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

After a broad selloff in the stock market which brought the Dow Jones down 8.5% from the mid-July all-time high, it seems markets are seeing a bit of a bounce today.

The nature of the price action today slightly resembles the sort of everything rally that we’ve experienced earlier this year. Markets are quite convinced that they, along with President Trump can force the Fed into an easing cycle and that if they want it bad enough, rates will go down.

Chinese Reference

Also helping markets this morning is the People’s Bank of China. As we mentioned in Tuesday’s update, the Chinese currency is now above 7 Yuan to the Dollar, a level that has a lot of people on edge as it highlights another facet of the current trade war.

Many investors were fearful that the PBoC would support the weaker Yuan, but it seems that when they set their reference rate today, it was actually stronger than many were expecting. Meaning, that China is doing their part to stymie the Yuan’s decent rather than encourage it, which is a comforting thought for the markets.

Seems a silly reason for a rally, but at this point investors are ready and willing to jump on a narrative that involves a Central Bank not trying to drive their own currency into the ground.

Stock traders, please stay on alert. With the VIX at its highest level since the start of the year, there’s still enough reason to suspect that we may not be out of the woods just yet.

Everything Bitcoin

Bitcoin volumes have been on the rise lately as the crypto market continues to bow to king BTC. Messari’s real 10 volume is above $2 billion a day for the first time in weeks and the bitcoin blockchain is once again seeing 4 transactions per second.

Bitcoin is rising slightly and as of this writing is testing $12,000. Altcoins, on the other hand, are bleeding badly as the crypto industry continues to consolidate.

The exception is Binance Coin though, which managed double-digit growth over the last 24 hours. A real rabbit out of a hat, especially considering allegations of a massive personal data breach.

Likely the technical analysis could have something to do with this as BNB has bounced off a rather conspicuous line of support.

Have an amazing day!

Mati Greenspan can be found on LinkedInTwitter, or etoro

This is a marketing communication and should not be taken as investment advice, personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been prepared without having regard to any particular investment objectives or financial situation, and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past performance of a financial instrument, index or a packaged investment product are not, and should not be taken as, a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared utilizing publicly-available information.

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