Financial News

Cryptocurrency markets have been sold off quite drastically during the course of the week, as there are multiple concerns when it comes to the market space. The unrest in Kazakhstan has certain traders concerned due to the fact that Kazakhstan is the second biggest Bitcoin miner in the world. This could disrupt hash rate, which of course could put downward pressure on price, at least in the short term.

Further working against the value of cryptocurrencies is the fact that the Federal Reserve policy looks to be one of tightening, meaning that interest rates will continue to climb in America, which has a bit of a “knock on effect” on risk assets, with cryptocurrency being a major risk asset. Nonetheless, it is worth noting that most cryptocurrency is oversold, and that value hunters are more likely than not to reenter the space, as cryptocurrency has a remarkable resiliency built into the fact that a lot of the major holders of crypto have their coins off-exchange.

All of that being said, crypto does tend to overshoot in both up and down moves, so at this point in time jittery nerves will more than likely continue to be a mainstay when it comes to Bitcoin and Ethereum, as well as other smaller coins.

On Friday, the jobs report came out the United States with the US adding 199,000 nonfarm payrolls during the month of December, much lower than the anticipated 450,000 median forecast by economist across the country. As result, the 10 year treasury note yield rose to 1.751%, the highest that it has been for several months. US stocks of course extended their losses on Friday after the jobs report came in at half of what was expected. The month of December ended up being the worst month of job creation in the last 12 months, although some will be quick to point out that it includes the beginning of the omicron variant picking up, so whether or not Wall Street is willing to look past it is a completely different question.

One will more than likely say that the bigger fight for Wall Street right now is getting their head around the Federal Reserve raising interest rates three times next year, so as a result the reaction to the jobs report may be somewhat muted.

Saudi Arabia has cut oil prices for buyers in Asia, signaling that oversupply from OPEC and its partners could loosen the market while the rapid spread of coronavirus in Asia continues to put downward pressure on demand. State-controlled company Saudi Aramco reduced its February prices for all types of crude that will be shipped to Asia, its main market. It dropped the price of Arab Light by $1.10 from January 2 $2.20 a barrel above the regional benchmark. Aramco also has dropped prices for buyers in northwest Europe for the next month, while leaving levels for the Mediterranean largely in change. Prices for US consumers remain unchanged as well.

OPEC+ decided on Tuesday to increase production in February by 400,000 barrels a day, even though it suggests that the market would switch to be an oversupplied from this month. The biggest problem currently seems to be that there are production issues in Nigeria, and Libya specifically. Because of this, markets may or may not get the full 400,000 barrel increase.