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The Wesfarmers Ltd (ASX: WES) share price has tumbled over the last month of trade, extending losses to more than 28% this year to date.

After a series of downward moves, the Wesfarmers share price fell to its 52-week closing low of $41.16 on 17 June, as illustrated on the chart below.

However, it’s since bounced from that level, currently trading at $42.32 at the time of writing.

Is Wesfarmers reversing course?

The share is still bottom-heavy and has some way to go before clawing back to its May 2022 levels.

Despite this, it still has five buy calls and five hold calls from brokers, according to Bloomberg data.

Balancing the picture is that six brokers also say to sell Wesfarmers shares.

In a note today, analyst Mohsen Crofts, from Bloomberg Intelligence, wrote that Bunnings and Kmart are Wesfarmers’ key assets in its long-term growth.

Crofts wrote:

Wesfarmers-owned hardware chain Bunnings’ brand and operational strength could increase its revenue and market share from 2023 once Australian housing stabilises with interest rates.

Earnings performance at Kmart, Wesfarmers’ discount department store brand, should improve this year as Covid-19 related costs and restrictions ease.

Meanwhile, analysts at JP Morgan echoed the sentiment in a May note. The broker said, “Wesfarmers is a beneficiary of the retail and housing cycle, with three industry leading retailers.”

“Following the downsizing of Target, acquisitions of Catch and Kidman, as well as a de-rating post capital return, the share price outlook is favourable.”

Wesfarmers share price snapshot

In the last 12 months, the Wesfarmers share price has slipped more than 28% into the red, dropping almost 10% in the last month alone.

The conglomerate has a market capitalisation of around $48 billion based on the current share price.

The post Down 28% this year, is the Wesfarmers share price at a turning point? appeared first on The Motley Fool Australia.

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More reading

• Here are 2 ASX dividend shares that analysts rate as buys this week
• Why is the Wesfarmers share price having such a stellar start to the week?
• Morgans tips 40% upside for the Wesfarmers share price
• Why I think these 2 ASX 200 dividend shares offer great buying right now
• 2 ASX companies busted for sneaky facial recognition on customers

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Inflation is an economic challenge that many S&P/ASX 200 Index (ASX: XJO) shares — and households — are facing.

We’ve seen rises in commodity prices, transportation costs, supply chain challenges, faster-growing wages, and so on. Some businesses aren’t able to pass on the higher costs, resulting in profit margins being hurt.

Investment group Blackstone has indicated that it’s going to avoid businesses that aren’t able to pass on rising costs in the form of higher prices.

According to reporting by The Australian, Blackstone’s senior managing director Michael Blickstead said that inflation is the group’s main concern. Within its own investment portfolio, and potential investments, Blackstone is looking at what it can do to mitigate the issues.

Some ASX 200 shares may not be able to pass on the higher costs and they will simply have to deal with lower profitability. That’s tough luck for them, which may explain some of the declines we’ve seen in the last few months, along with interest rate rises.

But, there are a few names that are able to pass on increases to their customers or clients, such as the three below, which can be called ‘price makers’. That’s where the companies get to decide their prices.

National Australia Bank Ltd (ASX: NAB)

NAB is one of the big four ASX banks along with Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), and Australia and New Zealand Banking Group Ltd (ASX: ANZ).

It’s no secret the Reserve Bank of Australia (RBA) is increasing interest rates with more rises expected to follow. The RBA’s latest move was a 50 basis point increase.

If NAB (and the ASX 200 big bank shares) didn’t increase the interest rates charged on loans then it would hurt the bank’s net interest margin (NIM). The NIM is an important measure of bank profitability.

But, NAB did pass on the 50 basis point increase to borrowers. In fact, it passed on the whole rate rise very soon after the RBA’s announcement.

Brokers like Morgans and Morgan Stanley think the bank NIMs will rise as interest rates increase. However, there’s also a question of how much the rate increases hurt loan books and increase arrears.

Xero Limited (ASX: XRO)

Xero is one of the largest ASX tech shares, but it’s now a fair bit smaller this year after a plunge of the Xero share price of around 50%.

While Xero doesn’t focus on commodities or supply chains, it still has a cost base.

The ASX 200 share has recently announced that it’s going to increase its subscription prices in some of its important markets including the UK, Australia, and New Zealand, with some subscriber levels seeing high single-digit price increases.

APA Group (ASX: APA)

APA is one of the largest infrastructure businesses in Australia. It owns a national network of gas pipelines that transport half of Australia’s natural gas usage.

It also owns investments in renewable energy generation, gas storage, and gas power generation.

The ASX 200 share says that it’s “favourably exposed to rising inflation with almost 100% of contracted revenues linked to inflation indices”.

The post ‘Price makers’: 3 ASX 200 shares that can pass on rising costs in an inflationary environment appeared first on The Motley Fool Australia.

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More reading

• Has 2022 proven Woolworths is a defensive ASX share?
• ASX 200 midday update: St Barbara and Zip drop to multi-year lows
• 3 reasons why I think the Soul Pattinson share price is an excellent buy right now
• Why is the Fisher & Paykel share price heading south today?
• Worried about a US recession? Here’s what the ASX 200 banks are forecasting

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended APA Group and Xero. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Medibank Private Ltd (ASX: MPL) share price is edging slightly higher today following the company’s latest cash give back.

At the time of writing, the private health insurance giant’s shares are fetching at $3.18, up 0.32%.

Medibank returns COVID-19 savings

Investors are sending the Medibank shares into positive territory despite the S&P/ASX 200 Index (ASX: XJO) reversing its gains today.

For context, the ASX 200 Index is 0.07% lower to 6,519.2 points.

In its release, Medibank advised it is returning an additional $205 million in COVID-19 permanent net claims savings to customers. This brings the total amount of support provided by the business since the start of the pandemic to $682 million.

The cash back funds will be deposited into the customer’s bank accounts at a confirmed date in September this year.

The financial package includes up to $145 for extras only policies and up to $620 for hospital and extras policies.

In addition, Medibank and Ahm will also defer the 2022 premium increase for a further month to 1 November 2022.

The premium increase deferral and cash give back are being funded from additional COVID-19 permanent net claims savings.

Medibank CEO, David Koczkar commented:

We said right from the start that we would not profit from COVID-19. We’ve stuck by that promise with our broader package now reaching a record $682 million.

The cash give back will be welcomed by our customers as they grapple with pressures on household budgets due to rising inflation, interest rates, fuel prices and home energy costs.

We’ve also put premium increases on hold for another month, taking the premium increase deferral to 7 months until 1 November 2022.

Our focus remains on delivering value for our customers and supporting them through the ongoing impacts of COVID-19.

Medibank share price summary

Over the last 12 months, the Medibank share price has travelled around 1% higher despite the recent market volatility.

In comparison, the benchmark ASX 200 index has fallen by 11% over the same time frame.

Based on today’s price, Medibank presides a market capitalisation of roughly $8.54 billion.

The post Medibank share price climbs amid ‘cash give back’ appeared first on The Motley Fool Australia.

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More reading

• The Medibank share price has struggled in 2022. Could the company be a takeover target?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has given back its morning gains and dropped into the red. At the time of writing, the benchmark index is down 0.3% to 6,506 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are pushing higher:

Ampol Ltd (ASX: ALD)

The Ampol share price is up 5% to $34.77. This appears to have been driven by a broker note out of Morgan Stanley. According to the note, the broker has retained its overweight rating and lifted its price target to $39.00. It is bullish due to improving refining margins and increasing fuel volumes.

Downer EDI Limited (ASX: DOW)

The Downer share price is up 2% to $5.07. Investors have been buying this engineering company’s shares after it announced two major contract wins. Downer has been awarded two road maintenance contracts by Auckland Transport, valued at approximately $800 million over a maximum term of 10 years. Management notes that these contracts expand Downer’s strong working relationship with Auckland Transport.

Fletcher Building Limited (ASX: FBU)

The Fletcher Building share price is up 5% to $4.68. The catalyst for this was the release of the building products company’s investor day update. That update reveals that management has reiterated its earnings before interest and tax guidance for FY 2022. It expects EBIT before significant items to come in at ~NZ$750 million.

REA Group Limited (ASX: REA)

The REA share price is up 2% to $101.15. This morning analysts at Citi reiterated their buy rating and $153.50 price target on this property company’s shares. This implies potential upside of ~50% for investors over the next 12 months. Citi sees NSW stamp duty changes as a positive for REA.

The post Why Ampol, Downer, Fletcher Building, and REA shares are pushing higher appeared first on The Motley Fool Australia.

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More reading

• ASX 200 midday update: St Barbara and Zip drop to multi-year lows
• 2 powerhouse ASX shares going for dirt cheap right now: expert
• Why has the REA share price crashed by 40% in 2022?
• Ampol share price slips amid $150 million sustainable financing initiative
• 2 blue chip ASX 200 shares that Goldman Sachs rates as buys

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

In calm markets, the volatility index generally sits somewhere around 10. In the recent market upheaval, it has touched the 30s. The volatility index measures how quickly the market expects stock prices to change.  The higher the index, the wilder the anticipated swings in price. 

That spike in the volatility index raises a key question: Should you buy stocks now, or wait? As simple as that question is to ask, the answer depends as heavily on you as an investor as it does on stocks themselves.

You need to be able to have a long-term focus

High volatility means stocks are expected to move aggressively — sometimes up, sometimes down. When that volatility is combined with the bear market we’re in, there’s very real risk that there will be more aggressive moves downward. As a result, it’s critically important that you have a long-term focus with any money you’re willing and able to invest in the market.

After all, if you buy and the stocks you purchase later go down, you will have less in total net worth than you would have if you had just held cash. It can be a very frustrating feeling, as if you’re throwing good money after bad.

With a long-term focus, however, you can better recognize that when you buy shares and they go down, you still have the same number of shares — and thus ownership stake — as you did before. In addition, it gets easier to see how investing the same number of dollars after the stock crashes buys more shares than it did before the crash, helping new money go that much further.

A reasonable valuation estimate helps, too

Speaking of converting dollars to shares, investing when volatility spikes gets much easier if you have a good valuation tool, such as the discounted cash flow model, at your side. With the discounted cash flow model, you estimate the amount of cash the company will generate in the future. Then, you dial back (or discount) that cash flow based on how far in the future you expect the company to earn it. Add up those discounted cash flows and the total is your estimate of what the company is worth.

You’ll never get it perfect — you are predicting the future, after all — but if you do your homework and seek to really understand the business, you can often get reasonably close. The power of getting reasonably close, though, is that sometimes, severe market volatility in a bear market drives a company’s stock well below your estimate of its fair value. When that happens, you can swoop in and buy shares for less than you think they’re worth.

Turning a volatility-driven market crash into a bargain hunting expedition is an opportunity to take advantage of a very choppy market, and it’s one you usually only get when the volatility index is high.

Diversification reduces the impact when you get it wrong

Of course, there’s usually a good reason for a crashing market and spiking volatility index. In this case, it’s the combination of stagflation risks and rising interest rates. That combination can make it very difficult for weaker companies to survive. It can also radically throw off your otherwise reasonable valuation estimates, as rapidly rising costs can seriously mess with a business’s ability to generate cash.

As a result, it is incredibly important to spread your investments out across multiple companies in different industries. That way when (not if) one of your investments fails, the loss of that investment will have far less of an impact on your overall portfolio than it would have had if that company had been the only one you owned.

Put it all together and you have a path to buy even when volatility spikes

It’s scary to invest when the market is down and volatility is high. With a combination of a long-term focus, a decent valuation estimate, and diversification on your side, you’ve at least got a chance to turn it to your advantage. It’s not easy to invest in times like these, but history suggests that if you’re able to, you’re likely to come out successful on the other side. So make today the day you get these tools in your arsenal and are well prepared to invest despite spiking volatility. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Volatility index spikes: Should you buy stocks now or wait? appeared first on The Motley Fool Australia.

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More reading

• What’s dragging on the Qantas share price today?
• Down 33% in a month, is the Megaport share price in ‘value’ territory?
• Has 2022 proven Woolworths is a defensive ASX share?
• Is this why ASX lithium shares are being crushed today?
• What to expect from the Bitcoin price following last week’s thrashing

Chuck Saletta has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Qantas Airways Limited (ASX: QAN) share price is in the red on Wednesday.

Its slump comes amid findings that passengers of the airline and its subsidiary Jetstar suffered more delays and cancellations in May than those of competing airlines.

At the time of writing, the Qantas share price is $4.525, 0.55% lower than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is also recording a 0.21% fall.

Let’s take a closer look at what’s going on with Australia’s national airline on Wednesday.

Qantas share price slips amid unfavourable findings

The Qantas share price is sinking amid the release of data from the Bureau of Infrastructure and Transport Research Economics.

The data found Qantas cancelled more flights last month than both Virgin Australia and Regional Express Holdings Ltd (ASX: REX). Qantas’ subsidiary Jetstar also saw more late take-offs and delayed landings than its competitors did.

Here are some of the key figures:

• 38.5% of Qantas’ May flights departed late,
• 39.3% landed late, and
• 7.1% were cancelled

Meanwhile, its subsidiary Jetstar saw 42.3% of flights leave late, 39.4% land late, and 5.7% cancelled.

Rex performed best in terms of delays and cancellations last month. Just 1.4% of its flights were cancelled while 21.5% departed late, and 24.5% landed late.

Meanwhile, 5% of Virgin flights were cancelled, 35.6% took off late, and 34.3% landed late.

However, the news is unlikely to have dinted the ASX 200 airline’s stock today. It’s slipping alongside its home sector – the S&P/ASX 200 Industrials Index (ASX: XNJ). The sector is currently down 0.57%.

The company’s fellow ASX 200 travel stocks are also struggling. The Flight Centre Travel Group Ltd (ASX: FLT) share price is down 3.1% right now, the Webjet Limited (ASX: WEB) share price has slipped 2.65%, and the Corporate Travel Management Ltd (ASX: CTD) share price has fallen 4.64%.

Finally, the share price of Qantas’ ASX-listed competitor Rex is currently up 2.45%.

The post What’s dragging on the Qantas share price today? appeared first on The Motley Fool Australia.

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More reading

• ASX 200 travel shares take off again on Tuesday. Here’s why
• What’s boosting the Qantas share price on Tuesday?
• Why are ASX 200 travel shares lifting off on Monday?
• Qantas share price lifts amid new sustainability partnership
• What happened to the Qantas share price today?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Corporate Travel Management Limited, Flight Centre Travel Group Limited, and Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Megaport Ltd (ASX: MP1) share price has sunk another 2.17% on Wednesday. At the time of writing, it’s sitting at $4.96 on no news.

This brings Megaport’s losses to 33% for the month, or 74% this year to date.

In wider market moves, the S&P/ASX All Technology Index (ASX: XTX) has crept 50 basis points lower today. It too is down, 39% this year to date.

Is the Megaport share price in value territory?

Megaport shares are being punished in 2022. Now, with the market sell-off, losses have extended and the share is deep in the red.

Despite the pressure, analysts at Goldman Sachs remain constructive on its outlook and price Megaport at $13.10 per share.

At the current market price of $4.96, some might suggest it is trading at a deep discount to Goldman’s price objective.

Structural tailwinds in the cloud-usage and networking-as-a-service (NaaS) space are key drivers of Megaport’s growth, Goldman says.

The total market could reach $129 billion for these areas, the broker reckons. Certainly optimistic projections that could bode well for Megaport.

Further, whilst the market has been unkind to Megaport, if it is considered a value share, this could play in well to the case.

That’s because value stocks are likely to outperform growth after a slumped period, according to Cliff Asness, CIO at AQR Capital.

Speaking to Goldman Sachs’ June macroeconomic research paper Top of Mind, Asness said:

Looking ahead, I’m confident that Value can continue to outperform over a medium-term, say, three year, horizon precisely because the valuation spread between Value and Growth remains incredibly stretched, which would represent a stark break from the post-GFC cycle where Value delivered somewhere between subpar and dismal returns.

Irrespective, the Megaport share price has a long way to run to reach its former closing high of $21.88 reached on 17 November 2021.

The post Down 33% in a month, is the Megaport share price in ‘value’ territory? appeared first on The Motley Fool Australia.

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More reading

• Megaport share price slides 11% on dire day for ASX tech
• 3 ASX tech shares that could pop when the mood turns
• 3 ASX All Ordinaries shares that defied Thursday’s slump to leap higher
• 3 fantastic ASX shares that analysts reckon have huge upside potential
• Megaport share price hits multi-year low: Is this a buying opportunity?

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It’s no secret that 2022 thus far has proven to be an exceptionally difficult year for ASX shares. Over the year to date, the S&P/ASX 200 Index (ASX: XJO) is still down by a notable 13.7% or so, even with today’s gains. But let’s check out how the Woolworths Group Ltd (ASX: WOW) share price has fared.

Woolworths shares are often held up as ‘defensive’. That’s probably because Woolworths is a large, mature blue-chip, dividend-paying ASX share that operates in the consumer staples sector of the market. Because the company sells food, drinks, and household goods, it has a reputation as being recession-resistant, inflation resistant, and stable.

This is true to an extent. We all need to eat, drink, and keep our households running, no matter the economic conditions.

But does this truly make Woolworths shares a defensive investment? Let’s see how this company has fared over 2022. After all, this year has been dominated by concerns over inflation, interest rates, and a possible looming recession. So it will be interesting to see how Woolies shares have fared amid these concerns, given its defensive reputation.

So Woolworths shares started the year at a share price of $38.01. Today, the company is going for $34.24 a share at the time of writing. That’s a year-to-date loss of 9.9%.

That loss is a few percentage points less than what the ASX 200 has delivered over the year so far. Therefore, we can say that Woolworths shares have outperformed the market over 2022 as it currently stands. And, by extension, we can indeed conclude that, at least over this year, Woolworths has been an effective defensive share.

Is the Woolworths share price a 2022 buy?

It could get even better for Woolies investors too. As my Fool colleague James recently discussed, broker Goldman Sachs reckons the Woolworths share price could decisively recover over the next 12 months. This ASX broker currently rates Woolworths shares as a buy, with a 12-month share price target of $41.70. If that came to pass, it would mean an upside of more than 22% from the current share price.

Goldman justified this optimism by noting it is “encouraged by the resilience and superior operations” of Woolworths. The broker expects continuing price growth from the company, which should protect its margins as “COVID costs roll-off and cost efficiencies continue”.

No doubt that will come as good news for investors today.

At the current Woolworths share price, this ASX 200 blue chip has a market capitalisation of $41.49 billion, with a dividend yield of 2.75%.

The post Has 2022 proven Woolworths is a defensive ASX share? appeared first on The Motley Fool Australia.

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More reading

• ASX 200 midday update: St Barbara and Zip drop to multi-year lows
• 3 reasons why I think the Soul Pattinson share price is an excellent buy right now
• Why is the Fisher & Paykel share price heading south today?
• 5 things to watch on the ASX 200 on Wednesday
• How does the Macquarie dividend stack up against the ASX big four banks?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It has been another difficult day for ASX lithium shares on Wednesday.

In afternoon trade, a number of lithium shares are underperforming the market and sinking deep into the red.

Which lithium shares are sinking?

Here’s a summary of some of the notable moves in the industry:

• The Argosy Minerals Limited (ASX: AGY) share price is down 7%
• The Core Lithium Ltd (ASX: CXO) share price has sunk 9.5%
• The Lake Resources N.L. (ASX: LKE) share price has dropped 12%
• The Liontown Resources Limited (ASX: LTR) share price is down 5%
• The Sayona Mining Ltd (ASX: SYA) share price has fallen 7%

What’s happening?

Concerns over increasing supply and the potential impact this could have on lithium prices in the coming years have been weighing on lithium shares in recent weeks.

However, today’s decline appears to relate to the demand side of the equation.

This follows reports in Europe that Germany is planning to defy the European Union by backtracking on future plans to outlaw internal combustion engine (ICE) cars.

According to the Financial Times, Germany’s finance minister, Christian Lindner, has rejected plans for the ban on the sale of new petrol and diesel cars by 2035. This raises the prospect that the region’s green agenda will be watered down.

Germany is understood to be against the plan as there are concerns that it could lead to the loss of hundreds of thousands of jobs in the sector.

If Germany does go against the ban and ICE cars continue to be manufactured, this could have a major impact on the number of electric vehicles on European roads in 2035.

This could ultimately mean that lithium demand falls well short of forecasts, meaning we won’t need as much supply as previously thought. This may not bode well for prices of the white metal in the future.

The post Is this why ASX lithium shares are being crushed today? appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Bitcoin (CRYPTO: BTC) price isn’t exactly rocketing back to new highs after the horror week just past.

But the world’s biggest token by market cap has stabilised, at least.

At the time of writing, the Bitcoin price stands at US$20,401 (AU$29,408). That’s just about where it was trading at this time yesterday, after hitting an overnight high of US$21,620, according to data from CoinMarketCap.

Like we said. Not shooting the lights out. But still some 17% above the US$17,709 lows the token hit on Sunday, its lowest price since 2020.

Why did the Bitcoin price tumble last week?

Bitcoin has been under pressure amid rising interest rates that have driven other cryptos, like the TerraUSD stable coin and its supporting token Luna, over the edge.

The end of historic low rates has seen most risk assets — think high-growth tech shares — sell off sharply.

Last week, the tech-heavy Nasdaq dropped 5%, despite Friday’s rally.

The Bitcoin price fared even worse, with Glassnode reporting that crypto investors’ realised losses on their Bitcoin holdings hit a record US$7.3 billion over the week.

Now what?

Looking ahead, the wider crypto market is unlikely to shake off its notorious volatility any time soon.

Feroze Medora, director of APAC trading at Cameron on the Gemini crypto platform, said (courtesy of Bloomberg), “A toxic mix of bad news cycles and higher interest rates has hurt the crypto market and we can anticipate more volatility in the upcoming weeks.”

Glassnode noted in a report that fewer forced sellers in the months ahead could offer some support to the Bitcoin price. “With forced sellers appearing to drive much of the recent sell-side, the market might begin to eye whether signals of seller exhaustion are emerging over the coming weeks and months.”

But any sustained relief rally looks to be some way off yet.

Discussing the recent Bitcoin price moves, Katie Stockton, founder of Fairlead Strategies, said (quoted by Bloomberg):

It’s a very natural place to see some stabilisation, a kind of relief rally. We do think that relief rally would be muted, however, just given the downside momentum really across the board.

The post What to expect from the Bitcoin price following last week’s thrashing appeared first on The Motley Fool Australia.

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• Is Solana the next Bitcoin?
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• Why US$19,500 is a line in the sand for the Bitcoin price
• Why tech billionaire Bill Gates is ‘not involved’ in crypto or NFTs

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin. The Motley Fool Australia has positions in and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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