Tesla in Space, The Global Market Bounce in Stocks and Cryptos

Looks like we’re one step closer to life on Mars.

For those who haven’t seen, Elon Musk’s Space exploration company has just successfully completed the monumental task of launching the most powerful rocket of our generation, the Falcon Heavy.

The first payload of the groundbreaking rocket was one of Musk’s own Tesla Roadsters. Here we can see a dummy driving the hip car as he prepares to leave the vicinity of our planet.

You can’t buy publicity like this. Or, maybe you can…

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

• Is the Worst Behind Us?
• XIV the Anti Volatility
• Cryptodads are Hodling

Please note: All data, figures & graphs are valid as of February 7th. All trading carries risk. Only risk capital you can afford to lose.

The Global Bounce

After the Dow Jones saw its worst single-day sell-off in history on Monday, it had its best single-day performance in 15 months.

Traders on Wall Street were only too excited to BTFD that they didn’t even wait to see if the drop is over. This is extreme volatility and for short-term traders, it doesn’t get any better than this.

The bond market made a sharp recovery as well but failed to hold on to most of her gains by the end of the day.

We also have a bounce in cryptocurrencies, which syncs almost exactly to a tee with the bounce in the other markets. Here we can see the bottoms of both Bitcoin and the Dow almost at the exact same time.

We probably won’t know if the sell off is over at least until the end of the week. Most likely we can see some consolidation and heavy volatility as the market processes what just happened.

Of course, if things do start to look one-sided during the US session today, feel free to jump right in.

What I would like to see from both crypto and traditional markets is a bit of divergence. I mean, there’s no real reason Ethereum should be hugging Bitcoin like this…

Or that Oil and the USDJPY are swinging together…

Later today we’ll also get the crude oil inventories numbers from the USA, which should shake things up a bit.

Unfortunate Side Effect

One ETF had a particularly bad time over the course of this sell-off.

The XIV was designed to be a way for investors to bet that volatility will remain low. So when it spiked through the roof, the price got hammered…

Trading on this asset has been halted for now and Jim Cramer has a good rant on how this should never have happened.

Very glad that eTorian exposure was particularly low on this asset. Kudos to whoever went short.

Crypto News

There has been a flood of news in the cryptocurrency space over the last few weeks. Sometimes it’s difficult just to keep up. Many thanks to those of you who continue to send me articles and ask my opinion.

The thing is, it’s not always clear from a headline if a bit of news is going to have a positive, negative, or no effect on the price.

Take this headline for example….

It’s full of FUD and light on facts.

The story is that the Indian Finance Minister said that the “government does not consider cryptocurrencies as legal tender.”

Well, that’s true everywhere in the world except Japan. So this isn’t really news. If we dig deeper to get the full picture we should find that India is working hard to set up a real regulatory framework to deal with these assets, which ultimately is a good thing for everyone.

Flipping over to the United States, many were expecting the SEC to bring down the ban hammer on ICOs and cryptos in general but in fact they went the opposite way.

I could not possibly explain it better than this two minute video from the chairman of the CFTC Christopher Giancarlo, my new favorite cryptodad.

Watch the video here: https://www.reddit.com/r/Bitcoin/comments/7vq66y/cryptodads_are_here_to_save_bitcoin/

Wishing you a spectacular 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.

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