Mati Greenspan, Senior Market Analyst at FX broker eToro, has provided his daily commentary on traditional and crypto markets for April 12, 2019. The text below is an excerpt and does not contain the full analysis.
Highlights include:
- Crypto Steps Back: The crypto market has dropped over the past 24 hours. This indicates that a new trading range will likely be created.
- Fed Makes a Mistake? Noted expert on central banks Mohamed El-Erian says that the Fed may have just made a huge mistake by shifting gears too quickly.
- IMF Head Addresses Crypto: IMF MD and Chairwoman Christine Lagarde stated that bank-backed cryptos (such as JP Morgan’s crypto project) are shaking the system.
- WikiLeaks Founder Arrested: Julian Assange was arrested after nearly seven years in the Ecuadorian Embassy.
The most famous hacker on the planet was arrested in London yesterday. Love him or hate him WikiLeaks founder Julian Assange has been creating controversial headlines for most of his adult life.
After nearly seven years in the Ecuadorian Embassy, it seems his hosts finally had enough and kicked him out. Some are saying that the expulsion of this clearly unwanted house guest is a violation of international treaty, and some are saying that his arrest by London police yesterday is an attack on journalism. See what I mean about the controversy?
The way it seems to me, Julian seems to do the right thing, in the wrong way. Take bitcoin for example. When the international payments companies imposed a blockade on WikiLeaks nearly 10 years ago, Assange announced that he would begin accepting donations in bitcoin.
The founder of Bitcoin, had this to say about Assange’s actions.
Keep in mind, this is the way that millions of people had heard about bitcoin for the first time.
Also, for those saying that Assange’s arrest had any effect on the market, that’s just preposterous. There’s nothing about this story that would cause anybody to buy or sell any asset. As far as investors are concerned, this is pure puff.
Traditional Markets
One of the biggest concerns among investors over the last year or so has been the possibility that the world’s central banks would make a “policy mistake.”
It seems that now, one of the world’s most renowned market commentators and the man who literally wrote the book on central banks, Mohammed El-Arian, says that the Fed may have just made a huge mistake by shifting gears too quickly.
This is a recurring theme that we’ve been writing about in these updates for some time. How exactly, or more importantly, when exactly, this will affect the markets remains to be seen.
A dovish Fed usually has the effect of sending stocks higher. What we don’t know is how the global economy will react from them changing from tapping the breaks to pushing the gas pedal to the floor so darn quickly.
Interesting Meetings
The biannual meetings of the World Bank and the International Monetary Fund started out with a bang today.
Here’s the head of the IMF on camera with some interesting statements about cryptoassets.
Notice, that she draws the lines here by saying that it’s the banker cryptos that are doing the shaking as she tries to exclude bitcoin from the party.
Somehow, I just don’t think that JP Morgan coin was what more than half of some 37,000 respondents had in mind when they answered this IMF twitter poll.
Earlier this week, Lagarde hosted a hot debate that pitted JP Morgan against Circle. I haven’t seen it yet but definitely looks popcorn-worthy.
The meetings will continue throughout the weekend, but honestly, I can’t imagine how the above interview can possibly be topped.
Epilogue
After the false breakout earlier this week, cryptos took a step down over the last 24 hours. The fact that we failed to go further up speaks volumes about the current appetite, but it doesn’t necessarily mean it will go lower, as many bears have indicated.
In fact, in my view, the most likely scenario is that we now create a new range, or even, hopefully, a sustained stabilization. Even as I write this though, I see that Messari’s real 10 volume number is still elevated above $600 million. So the market is clearly still excited.
Happy to report that the bitcoin lightning torch is on the final hop of its journey to Venezuela.
Also, more importantly in the Greenspan family, both mom and baby are healthy and happy. Many thanks to all of the jubilant responses on social media, we’re certainly feeling the love.
Some have pointed out that technically speaking, the torch was in my possession when the baby was born, so we’ll certainly need to think up a suitable name for the child of the torch.
Speaking of happy endings, I think we’re all looking forward to something spectacular this Sunday. My personal hope is that the mother of dragons and the bastard king manage to beat back their enemies, but this show has a tendency to be just about as predictable as the financial markets.
Wishing you all a very pleasant weekend.
Mati Greenspan can be found on LinkedIn, Twitter, 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.