Round up of today’s market news

North American News

US Major Indices Edge Higher Despite Early Lows

US major indices closed the day with modest gains, recovering from initial losses experienced in the morning session.

Market Performance

• Opening Lows:
  • Dow: -188.18 points
  • S&P: -34.75 points
  • NASDAQ: -142.57 points

Closing Numbers:

• Dow Industrial Average: +39.55 points (+0.09%) at 42196.52
• S&P 500: +0.79 points (+0.01%) at 5709.54
• NASDAQ Composite: +14.76 points (+0.08%) at 17925.12
• Russell 2000: -2.02 points (-0.09%) at 2195.00

Top Performers:

• Tencent ADR (TCEHY): +5.71%
• Snap (SNAP): +4.46%
• Super Micro Computer (SMCI): +3.58%
• Salesforce Inc (CRM): +3.20%
• Palantir (PLTR): +2.88%
• Nio ADR (NIO): +2.56%
• Alibaba ADR (BABA): +2.22%
• Taiwan Semiconductor (TSM): +2.14%
• Lam Research (LRCX): +2.10%

Notable Decliners:

• Tesla (TSLA): -3.49%
• Delta Air Lines (DAL): -3.08%
• First Solar (FSLR): -2.58%
• Ford Motor (F): -2.51%
• Grayscale Bitcoin Trust (GBTC): -2.48%
• Celsius (CELH): -2.40%
• Merck & Co (MRK): -2.34%
• Bitcoin (BTC): -2.34%
• GameStop Corp (GME): -2.28%
• Rocket (RKT): -2.11%
• Trump Media & Technology Group (DJT): -2.17%
• Uber Technologies (UBER): -1.87%

Despite early losses, the indices managed to recover, reflecting a day of mixed sentiment in the market as investors reacted to ongoing geopolitical concerns and economic data.

United States MBA 30-Year Mortgage Rate – Actual: 6.14% Previous: 6.13%

• New high reached United States MBA 30-Year Mortgage Rate now at 6.14%

Latest U.S. Mortgage Data:

• 30-Year Mortgage Rate
  • Actual: 6.14% Previous: 6.13%
• Mortgage Applications (WoW)
  • Actual: -1.3% Previous: 11.0%
• Mortgage Market Index
  • Actual: 292.3 Previous: 296.1
• Purchase Index
  • Actual: 149.3 Previous: 148.2
• Mortgage Refinance Index
  • Actual: 1,099.5 Previous: 1,132.9

ADP September employment +143K vs +120K expected

• ADP September 2024 data

• Prior was +99K (revised to +103K)
• Annual pay growth for job-stayers 4.7% vs 4.8% prior
• Job-changers’ pay gains 6.6% vs 7.3% prior
• Services +101K vs +72K prior
• Goods +42K vs +27K prior
• There was strength in construction, education and leisure/hospitality

Comment:

“Stronger hiring didn’t require stronger pay growth last month,” said Nela Richardson, chief economist, ADP. “Typically, workers who change jobs see faster pay growth. But their premium over job-stayers shrank to 1.9 percent, matching a low we last saw in January.”

Details:

• Natural resources/mining 14,000
• Construction 26,000
• Manufacturing 2,000
• Trade/transportation/utilities 14,000
• Information -10,000
• Financial activities 2,000
• Professional/business services 20,000
• Education/health services 24,000
• Leisure/hospitality 34,000
• Other services 17,000

Softer US auto sales highlight the pain from higher rates

• Recap of US Q3 and September auto sales data

Wards outlined softer US auto sales in September and Q3.

Q3 2024 Highlights:

• Q3 sales: 3.88M units, down 1.9% from 3.96M in Q3 2023
• Q3 SAAR: 15.6M units, flat y/y and down from 15.7M in Q2
• Year-to-date sales through September: 11.69M units, up 1% y/y

Annualized sales have shown no growth in the past six months overall and the trend appears to be worsening in September data.

• September US light vehicle SAAR came in at 15.8M units, below expectations of 16.1M
• Raw volume for September was 1.17M units, down 12.8% y/y

Big 7 Sept Sales:

• Ford: 142,576 units (-0.3% vs expectations, -10.5% y/y)
• GM: 206,379 units (-0.8% vs expectations, -8.3% y/y)
• Honda: 105,527 units (-6.6% vs expectations, -8.6% y/y)
• Nissan: 65,827 units (-3.2% vs expectations, -11.6% y/y)
• Stellantis: 95,098 units (-3.0% vs expectations, -20.5% y/y)
• Toyota: 162,599 units (-6.0% vs expectations, -20.3% y/y)
• Hyundai/Kia: 127,941 units (+1.5% vs expectations, -10.4% y/y)

Shares of Tesla dip as Q3 deliveries were reported

• Whisper numbers were higher than the consensus

The analysts consensus for Q3 deliveries was 463,310 but the whisper number was 472K based on VIN numbers. Tesla reported deliveries of 443,956 and production of 410,831 for Q2.

The likely bigger market mover for Tesla will be the robotaxi event on October 10 and shares have risen 20% in the past month in anticipation. 

Fed’s Barkin: ‘Last mile’ of inflation may still take longer than expected

• Comments from Fed’s Barkin

• The Fed’s 50 basis point cut was warranted as rates were at of St. with declines inflation and unemployment rate near its sustainable level
• Fed cannot declare inflation battle is over
• Expect little further drop in core PCE until next year
• Watching closely how lower interest rates influence home and auto sales to see if the man risks out running supply
• 50 basis points to cut shown as the median Fed policy projection for the rest of 2024 would also take a little bit of the edge off rates
• While a low hiring, low firing labor market could persist, demand for workers could also move higher if demand grows
• Recent labor action and geopolitical conflict are also among inflation risks
• The pace and extent of rate reduction cycle requires Fed to be attentive to how economy and inflation evolve
• US debt level is a concern in the long term
• Worried price pressure could get ‘stuck’ next year
• Sees two further quarter-point cuts this year as a ‘reasonable path’ if economy evolves as expected
• Expects unemployment and inflation to stay roughly stable for the rest of this year
• Sees renewed tight labor and demand spurred by Fed rate cuts as possibly keeping inflation lodged above 2% next year
• Current rate cuts a proper recalibration of policy, but full normalization would require inflation to hit 2%

U.S. Port Strike Causes Chaos: Biden Pressures Employers for Resolution

• Biden administration urges U.S. port employers to end strike with dockworkers, disrupting half of the country’s ocean shipping. Analysts warn of billions in economic losses as container vessels pile up at ports.

President Joe Biden’s administration heaped pressure on U.S. port employers to raise their offer to secure a labor deal with dockworkers on strike for a second day on Wednesday, choking half the country’s ocean shipping. The strike by the International Longshoremen’s Association (ILA) union has blocked everything from food to automobile shipments across dozens of ports from Maine to Texas in a disruption analysts warn will cost the economy billions of dollars a day.

More than 38 container vessels were already backed up at U.S. ports by Tuesday, compared with just three on Sunday before the strike, according to Everstream Analytics.

Goldman Sachs flag hits to GDP, NFP from US east coast port strike

• GS say most transport strikes since 2000 have been resolved in less than 2 weeks

Goldman Sachs note on the US port strike, in summary:

• estimate that a 10-day full shutdown of East Coast and Gulf Coast ports would result in a 0.2pp hit to quarterly annualized GDP growth in Q4
• Most transportation-industry strikes since 2000 have lasted less than 2 weeks. In order to weigh on October payrolls, the strike would need to last the entire pay period including October 12th. If the strike lasts through the reference period, it would directly weigh on October payroll growth by 45k

ICYMI – J.P. Morgan Global Manufacturing PMI signals contraction for 3rd consecutive month

• At 48.8 in September the rate of decline was the fastest in almost a year

The J.P.Morgan / S&P Global Market Global Manufacturing PMI was published overnight Tuesday, coming in at 48.8 in September.

• Output, new orders, employment, and stocks of purchases all fell, contributing to the contraction.
• Suppliers’ delivery times were the only component making a positive contribution.

• Manufacturing production decreased for the first time in 2024 due to reduced new business.
• New orders and new export orders both experienced significant contractions.
• The intermediate and investment goods sectors saw a decline in production, while consumer goods had minimal growth.

• Regional Performance:
  • The eurozone, led by Germany, saw the sharpest production decline.
  • Output contracted further in the US, with marginal declines in Japan and stagnation in mainland China.
  • India, Brazil, Spain, and the UK showed relatively stronger growth among major economies.
• Employment and Purchasing Activity:
  • Employment levels declined for the second month in a row, marking the largest drop since December 2023.
  • Purchasing activity and input stocks were reduced as manufacturers attempted to minimize costs.
• Business Optimism and Price Inflation:
  • Business optimism fell to a 22-month low, with declines across all sub-industries.
  • Input costs and selling prices rose at slower rates, marking the mildest increases since March.
• Comment from J.P.Morgan:
  • Bennett Parrish, Global Economist at J.P.Morgan, noted that the global manufacturing output PMI showed a weakening trend, with a significant drop to a nine-month low of 49.4.

Commodities

Gold Holds Steady Amid Geopolitical Tensions and Economic Data

Gold prices remained relatively flat on Wednesday, experiencing a slight decline of 0.50% as traders monitored escalating tensions between Israel and Iran.

Market Overview

• Current Trading: Gold is trading at $2,648 after reaching a high of $2,663 earlier in the session. Despite recent bearish momentum, geopolitical factors continue to support bullion prices.
• US Economic Indicators: The ADP National Employment Change report revealed an increase of 143K jobs in September, exceeding expectations and indicating robust private hiring. This could set a positive tone ahead of the Nonfarm Payrolls (NFP) report expected on Friday, which forecasts an addition of 140K jobs.

Geopolitical Impact
The ongoing conflict in the Middle East remains a significant driver of gold prices, as traders anticipate Israel’s response to Iran’s recent missile attacks. Market sentiment reflects a cautious outlook, as US equities are trading in negative territory, contributing to gold’s safe-haven appeal.

Interest Rate Considerations

• Fed Comments: Richmond Fed President Thomas Barkin noted that while the Fed’s recent 50-basis-point rate cut addressed misalignments, the inflation battle is ongoing. This mixed sentiment influences expectations for future rate adjustments.
• Market Predictions: According to the CME FedWatch Tool, the likelihood of a 25 bps rate cut stands at 63.8%, with a 50 bps cut being less probable at 36.2%.

Currency Dynamics
The US Dollar Index (DXY) has risen by 0.39%, reaching 101.60, which poses a challenge for gold as a non-yielding asset. Despite the stronger dollar and higher Treasury yields, gold remains supported by geopolitical uncertainties.

Overall, as investors await further job data, the interplay between economic indicators and geopolitical events continues to shape the outlook for gold.

US crude oil settles at $70.10

• Up $0.27 or 0.39%

The price of crude oil futures are settling at $70.10. That is up $0.27 or 0.39%. The high price today reached $72.45. The low price was at $69.90.

Technically, looking at the hourly chart, the high price tested the high price going back to September 24 and rotated back to the downside. That is now key resistance.

Conversely on the downside, the low price stalled just ahead of the 200-hour moving average at $69.78. That is now key supports.

In between the support and resistance level is a swing area between $71.43 and $71.64. The 38.2% retracement of the move down from the August high comes in at $70.91.

OPEC calls out the Wall Street Journal

• Says the $50 oil article was completely fabricated

There is an interesting war of words unfolding between OPEC and the Wall Street Journal.

The WSJ today published an article saying that Saudi’s oil minister warned of $50 oil if cheaters within OPEC don’t stick to limits. They cited delegates who were on the call.

The Saudi message was “there is no point in adding more barrels if there isn’t room for them in the market,” said a delegate who attended. “Some better shut up and respect their commitments toward OPEC+.”

OPEC just hit back with a strong denial and the supposed call never even took place.

With reference to the Wall Street Journal (WSJ) article, dated 2 October 2024, titled “Saudi Oil Min Said Prices May Fall to $50/B if Others Cheat, Sources Say,” the OPEC Secretariat categorically refutes the claims made within the story as wholly inaccurate and misleading. The article falsely reported that a conference call took place in which the Saudi Arabian Energy Minister allegedly warned OPEC+ members of a potential price drop to $50 per barrel should they fail to comply with agreed production cuts. It also attributed an alleged quote to the Minister, stating: “Some better shut up and respect their commitments toward OPEC+.” These claims are entirely unfounded. OPEC secretariat stresses that no such conference call occurred last week, nor has any call or video conference taken place since the last OPEC+ meeting on September 5. The alleged statements, attributed to unnamed sources, lack any credibility and are completely fabricated. OPEC secretariat emphasizes that its meetings, whether in person or via teleconference, are consistently conducted in a civil and respectful manner. Therefore, it is deeply concerning that the WSJ would publish such a report, which not only lacks journalistic integrity and professionalism but also shows a blatant disregard for the respect owed to OPEC+ Ministers.

EIA weekly crude oil inventories +3889K vs -1250K expected

• Highlights of the weekly US oil report from the EIA

• Crude oil inventories +3889K vs -1250K exp
• Gasoline inventories +1119K vs +450K exp
• Distillates inventories -1284K vs -1400K exp
• Refinery utilization -3.3% versus expectations of -0.5%. Previously -1.2%

OPEC+ Panel Meeting: No Surprise, Gradual Output Increase Expected

• OPEC+ panel meeting likely to maintain current policy, gradual production increase planned from December onwards.

OPEC+ set to keep output policy unchanged at panel meeting. An OPEC+ ministerial panel scheduled to meet on Wednesday is unlikely to recommend any changes to policy, allowing the group to start gradually increasing production from December, two sources from told Reuters.

The two sources, who declined to be identified, said Wednesday’s meeting is unlikely to bring any surprises. One of them said it will reaffirm the need for member countries to comply with their production targets under the deal.

An OPEC+ source told Reuters last week that clarity on whether the compensation cuts were made in September would allow the December increase to go ahead.

North Carolina mining town crucial to the semiconductor industry. Helene just wrecked it.

• Mines in Spruce Pine, N.C. produce a unique kind of high-purity quartz used in semiconductor manufacturing.

In brief:

• The mines in Spruce Pine, N.C., about an hour outside of Asheville, produce a unique kind of high-purity quartz used in semiconductor manufacturing. The town is the only place in the world where the uniquely high-quality mineral can be found in such large quantities and produced for such a low price. The two companies that operate the mines in Spruce Pine said they’ve shut down local facilities as widespread flooding, power and communications outages plague Appalachia in the wake of the storm.
• Repairs at the facilities and in the town could lead to supply-chain bottlenecks and temporary price increases on chips and electronics, sources told MarketWatch, particularly since the material sourced in Spruce Pine is so difficult to find across the globe.

UBS forecast gold to $2900

• And Brent crude to $87

UBS gold forecasts from a note on rising conflict in the Middle East:

• end of 2024 forecast is to USD 2,750
• by Q4 2025 to USD 2,900

In brief from the note:

• anticipate that global markets will face occasional disruptions but do not foresee a full-scale conflict between Israel and Iran
• expect energy flows from the Middle East to continue largely uninterrupted
• equities should be bolstered by a soft economic landing in the US, accompanied by Federal Reserve rate cuts, strong corporate earnings, and optimism regarding the commercialization of artificial intelligence
• Gold remains appealing as a hedge against geopolitical risks and possible shifts in US policy related to the upcoming election. Gold is also likely to benefit from further Fed rate cuts, strong central bank demand, and increased investor interest through exchange-traded funds
• The outlook for the oil market remains positive, with support coming from Chinese stimulus and the Fed’s early easing measures, which should boost energy demand. Meanwhile, the rate of production increases in the US and Brazil has been slowing, and output from Libya is still low. Our base scenario is that Brent crude will trade at around $87 per barrel by year-end. Iran is incentivized to maintain unobstructed energy flows in the region due to its reliance on oil exports. However, any disruption to major oil supply routes, such as the Strait of Hormuz, or damage to critical oil infrastructure could push Brent crude prices above $100 per barrel for several weeks.

Brent crude oil is back near US$74.50

• Oil rallied on the Middle East conflict escalation

The significant escalation sent oil prices higher. Brent has traded up near $74.50 during Asia time.

EU News

European Indices close today with mixed results

• France’s CAC and UK’s FTSE 100 rise modestly

The major European indices are closing the day with mixed results.

Looking at the closing levels:

• German DAX, -0.33%
• France’s CAC +0.05%
• UK’s FTSE 100 +0.17%
• Spain’s Ibex -0.55%
• Italy’s FTSE MIB -0.28%

Eurozone unemployment rate 6.4% vs 6.4% expected

• Latest data from Eurostat – 2 October 2024
• Unemployment rate 6.4% vs 6.4% expected and 6.4% prior.

Citi predicts ECB to slash rates by 25 bps in October

• Citi expects ECB to cut policy rates by 25 bps in October, with further cuts planned through 2025 to reach 1.5% deposit rate

Citi has joined a growing number of banks in expecting the ECB to cut policy rates by 25 bps in October

Expects ECB to cut rates in October, December and through the start of 2025, to reach a deposit rate of 1.5% by September 2025

ECBs Vasle: The ECB cannot exclude or commit to rate cut in October

• ECBs Vasle weighs in on the October

• ECB cannot exclude or commit to a rate cut in October,
• There will be more cut, but will depend on the data
• Downward trend in inflation is sustainable and will continue

ECBs Schnabel: Return to 2% target in a timely manner is becoming more and more likely

• DECB’s Schnabel predicts timely 2% inflation target return for Euro zone, urging structural reforms for growth and innovation.

• Monetary policy cannot solve structural problems
• Return to 2% target in a timely manner is becoming more and more likely despite elevated services inflation and strong wage growth
• Growth in the euro area has become increasingly uneven in recent years.
• Monetary policy may contribute to rising heterogeneity, but it is not the main driver.
• Structural headwinds are holding back growth in some countries more than others.
• Signs of softening labor demand and progress in disinflation suggest inflation could sustainably fall back to the 2% target.
• Elevated services inflation and strong wage growth persist.
• Monetary policy alone cannot resolve structural issues.
• European governments must turn current challenges into opportunities.
• Europe has previously demonstrated its ability to adjust and rebound from adversity.
• Escaping stagnation requires action at both national and European levels.
• Focus on innovation, entrepreneurship, competition, and business dynamism is needed.
• Strengthening the Single Market, improving access to private equity, and reducing bureaucracy are critical.
• The green transition should be leveraged to advance innovation and regain price competitiveness.
• Policies must incentivize labor participation and preserve a skilled workforce through immigration and education.
• These efforts will strengthen the euro area.

ECB’s de Guindos: Risks to growth are still tilted to the downside

• Remarks by ECB vice president, Luis de Guindos

• Risks to growth are still tilted to the downside.
• Economic recovery is to strengthen over time.

Wall Street Journal: “Investors Gear Up for October ECB Rate Cut”

• Stumbling economy, falling inflation fueling rate cut talk

Lagarde spoke on Monday, expressing confidence on dropping inflation and that the Bank would not wait until the target is hit before cutting again.

The Wall Street Journal (gated) gather together a few analysts now locking in an October 17 rate cut:

• “Anything other than an October cut will now be difficult to justify,” said Jussi Hiljanen, chief strategist for euro and dollar rates at SEB Research.
• “The time for gradualism is over: today’s eurozone inflation release paves the way for another ECB rate cut this month,” Natasha May, global market analyst at J.P.Morgan Asset Management said in a note.

UK Financial System Faces Growing Concerns Amid Global Economic Downturn Fears

• Fears over risks to the UK financial system from a global economic downturn have surged to their highest level since 2019, with one-third of financial firms highlighting it as a major concern in a recent Bank of England survey.

Worries about risks to the UK financial system posed by a global economic downturn have risen sharply to their highest level since the second half of 2019, a Bank of England (BOE) survey showed on Wednesday. The Bank’s twice-yearly systemic risk survey polled 55 financial firms between July 23 and August 12 and asked each participant to list the five risks they believed would have the greatest impact on the UK financial system if they materialised.

One-third of participants flagged worries about the threat to the UK financial sector associated with an overseas/global economic downturn, an increase of 19 percentage points and the largest single increase compared with the results of the previous survey in March, the BoE said.

Bank of England warns of global asset price risks

• BoE cautions on stretched global asset prices, warns of vulnerability to big fall amid geopolitical risks

Global asset prices remain stretched and are vulnerable to a big fall as investors grow more concerned about geopolitical risks, the Bank of England said on Wednesday.

The BoE said overall risks to British financial stability were unchanged compared with its last assessment in June, but that it would be wrong to draw comfort from a rapid rebound in asset prices after a drop in August.

“Valuations across several asset classes, particularly equities, quickly returned to stretched levels following the episode. Markets remain susceptible to a sharp correction,” the BoE’s Financial Policy Committee said in a quarterly statement.

“Global vulnerabilities remain material, as does uncertainty around the geopolitical environment and global outlook,” the BoE said.

Asia-Pacific-World News

Mainland China is on holiday, leaves Hong Kong to ramp shares even higher

• Hong Kong’s Hang Seng index is roaring again today

ANZ say the path of least resistance for the RBNZ is a 50bp interest rate cut next week

• ANZ do say, though, that “its going to be a close-run thing.”

HSBC expect a 50bp interest rate cut from the Reserve Bank of New Zealand next week

• RBNZ meeting is October 9

HSBC, too, are calling for a half percent cash rate cut, citing:

• Q3 Quarterly Survey of Business Opinion (QSBO) highlighted that excess capacity is persisting and that weak demand is the key concern facing businesses … also showed easing price pressures, with businesses reporting that they are now unable to pass higher input costs on to higher prices
• the monthly ‘selected price indices’ – a partial, timelier read on CPI – point to further disinflation in Q3, with headline CPI inflation likely to be comfortably back in the RBNZ’s 1-3% target band

Japan’s PM Ishiba: Not in an environment for additional rate hike

• The new Japanese PM Shigeru Ishiba who was considered a hawk delivers dovish remarks

• Not in an environment for additional rate hike.
• I want to coordinate with the BoJ on the economy.
• I want to make the economy strong with an economic package.
• We will do all we can to overcome deflation.
• I expect the BoJ to conduct policy to exit from deflation based on 2013 accords.
• I expect the monetary easing trend to stay in place.

Japan Bond Market Faces Hangover from BoJ’s Buying Spree

• Japan’s bond market braces for disruption as shortage caused by BoJ’s buying spree interferes with derivatives settlement, impacting market liquidity.

Japan’s $9 trillion bond market is bracing for disruption as a shortage of paper caused by the central bank’s massive buying is expected to hit the settlement of derivatives used by investors and the dealers who underwrite the nation’s debt sales.

Decades of fighting deflation drove the Bank of Japan (BOJ) into asset purchases and made it the majority owner of the country’s national debt, with a balance sheet bigger than the $4 trillion economy and five times the size of the U.S. Federal Reserve’s, relative to gross domestic product.

Participants say the bond’s scarcity in the open market will interfere with buying the so-called ‘cheapest-to-deliver’ bonds to settle derivatives contracts at maturity, crucial for the market to trade smoothly and price with precision.

Japan’s Economy Minister says not necessarily correct that Ishiba positive about further rate hikes

• Newly appointed Economy Minister Akazawa

• complete exit from deflation is top priority
• says Bank of Japan should be careful about raising rates given it takes time to completely exit deflation
• Ishiba’s comments on need for monetary policy normalisation have various conditions attached

South Korean September consumer price index marks slowest rise y/y since February 2021

• Headline inflation came in well below expectations

Info comes via Reuters report.

South Korea September consumer price index +1.6% y/y (Reuters poll +1.9%)

• +0.1% m/m (Reuters poll +0.3%)
• Core CPI +2.0% y/y vs +2.1% in August
• September consumer price index marks slowest rise y/y since February 2021
• Core CPI marks slowest rise y/y since November 2021

South Korean finance minister remarkson the lower inflation data, and also on recent events:

• Will closely monitor economic, market impact from middle east tensions
• Inflation in downward stabilising trend

South Korea promises bold, immediate measures if market volatility excessive

• South Korean Vice Finance Minister on the newswires

Will take immediate, bold measures if market volatility heightens excessively

Cryptocurrency News

Ethereum Faces Pressure Amid Middle East Crisis, Eyes Key Support Level

Ethereum (ETH) is experiencing a significant downturn, currently trading around the $2,400 psychological level, down over 4% as the geopolitical situation in the Middle East escalates. The ongoing conflict involving Israel, Hamas, Hezbollah, and Iran is adversely impacting market sentiment, leading to substantial outflows from Ethereum ETFs.

Market Dynamics

• ETF Outflows: Ethereum ETFs saw $48.6 million in outflows, highlighting a stark shift in investor sentiment. The bulk of these outflows included $26.6 million from Grayscale’s ETHE and $25 million from Fidelity’s FETH, marking their highest day of outflows since inception.
• Mixed Sentiment: Despite the negative ETF flow, spot traders on crypto exchanges show signs of buying pressure, potentially indicating a buy-the-dip strategy among investors. In the last 24 hours, Ethereum has recorded a net outflow of nearly 40,000 ETH from exchanges, suggesting that investors are looking to capitalize on lower prices.

Key Support Level
Ethereum’s critical support level stands at $2,395. Analysts believe that if Ethereum can hold above this level, it may bounce back, especially as funding rates have remained largely positive despite market volatility.

As the situation in the Middle East continues to unfold, investors are closely monitoring both geopolitical developments and the cryptocurrency market’s response to these external pressures.

Worldcoin Faces Decline Amid FTX Auction Plans

Worldcoin (WLD) has seen a decline of over 6% on Wednesday as news breaks that the FTX estate plans to auction off its locked WLD tokens later this week to raise funds for creditors.

Market Implications

• Auction Details: FTX holds 22.3 million locked WLD tokens valued at approximately $37 million. The upcoming auction is expected to occur at a “75%’ish” discount, raising concerns about downward pressure on WLD prices.
• Previous Auctions: Earlier this year, FTX generated around $232 million by selling 1.8 million Solana (SOL) tokens, indicating the potential impact of such sales on market sentiment.

Supply Shock Concerns
Investors are also bracing for a potential supply shock as WLD is set to unlock tokens valued at over $336 million throughout October. Initially scheduled to complete in 2026, the unlock timeline has been extended to 2028, with 2 million WLD tokens being released daily until then. This could exacerbate the decline in WLD’s value as more tokens enter circulation.

Overall, the combination of the impending auction and the significant unlock schedule creates a challenging environment for Worldcoin, prompting traders to reassess their positions amidst the heightened uncertainty.

XRP Faces Decline Amid ETF Filing and Ongoing Regulatory Uncertainty

XRP (Ripple) has slid nearly 3% on Wednesday, currently trading at $0.5881. This decline comes despite the announcement from asset management firm Bitwise, which has filed an S-1 registration with the SEC to register the first US-based Spot XRP ETF.

Market Overview

• Support Levels: XRP is testing the $0.5946 support level, and analysts warn of a potential decline towards the 50-day EMA at $0.5531 if bearish momentum continues.
• ETF Filing: The S-1 registration is a crucial step in the process of securing approval for the Spot ETF. In a press release, Bitwise CEO Hunter Horsley expressed optimism about the potential for blockchain technologies to create new monetary assets and applications for the modern era.

Regulatory Landscape
While the filing is a significant move for XRP, traders remain cautious due to the lingering effects of the SEC’s lawsuit against Ripple, which concluded in August 2024 with a ruling viewed as a partial victory for both parties. The possibility of an appeal by the SEC adds another layer of uncertainty for XRP holders, as it could affect the legal clarity surrounding the asset.

As XRP traders digest this latest ETF news, market sentiment remains mixed, with concerns about both regulatory implications and the immediate price action influencing trading decisions.

Follow our recently launched pages. Join our community and never miss a beat in the dynamic world of trading.

https://www.facebook.com/BilalsTechLtd

https://www.linkedin.com/company/bilals-tech/

https://t.me/Market_Moving_News