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Please note: All data, figures & graphs are valid as of August 6th.
Following the Fed’s cut and the renewal of Trump’s trade war, markets have seen a sizable sell-off. Here we can see the Dow’s slide of 8%. On Friday we mentioned a fair chance of testing the 200 DMA (blue line), a level that we’ve been toying with today.
As you can see, we’re getting a bit of a bounce this morning and the question now becomes will the price turn around from here or will we head towards the lows from December?
More than Seven
The US-China trade war reached a milestone too as the USDCNH surpassed 7 Yuan to the Dollar for the first time since the financial crisis.
Some people have gone so far as to say that the rally we had in bitcoin is a direct result of the falling Yuan. Of course, this is one possible explanation, but so is Brexit for that matter.
The possibility of a no-deal Brexit could very well have people hedging themselves against the potential of another large leg down for the Pound Sterling.
Due to the anonymous nature of bitcoin, it’s extremely difficult to tell exactly where the demand is coming from. The supply factors of course, have not changed by much.
The supply side has however changed for Litecoin over the weekend, who has seen a very successful block reward halving event. There was a minor pop in the price of LTC around the event but it’s now back to where it’s been holding steady for the last few weeks.
All in all, Litecoin is up 333% since the mid-December lows, making the run up to the halving fairly significant. As we’ve been saying, these type of things have a tendency to get priced into the markets well before they occur and in this case we can see the production of new coins dropped in half and the price per coin has tripled.
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Mati Greenspan, Senior Market Analyst, eToro