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The Whitehaven Coal Ltd (ASX: WHC) share price is tumbling today amid new findings Australia is ditching coal 2 to 3 times faster than previously anticipated.

The Australian Energy Market Operator (AEMO) – the manager of Australia’s National Electricity Market – made the claim within its ‘step change’ scenario.

At the time of writing, the Whitehaven share price is trading at $2.41, 3.6% lower than its previous close.

Let’s take a closer look at the scenario AEMO claims is the most likely to eventuate.

Whitehaven share price falls amid AEMO findings

The Whitehaven share price is struggling as the AEMO finds 39% of Australia’s coal-fired power capacity could be dropped by 2030.

On top of that, the body predicts the utility scale of renewable energy will be increased 9-fold by 2050.

According to AEMO’s ‘step change’ modelling, 14 gigawatts of Australia’s 23-gigawatt coal capacity will be withdrawn by 2030. That’s more than 8 gigawatts more than thermal plant owners had assumed.

Additionally, all brown coal generation and more than 66% of black coal generation could be scrapped by 2032.

That’s 16 years earlier than AGL Energy Ltd (ASX: AGL) plans to retire its brown coal-fired Loy Yang Power Station.

However, while the Whitehaven share price is plunging, that of AGL isn’t suffering at all. It’s recording a 0.94% gain at the time of writing.

Last year, coal-fired power represented 54% of Australia’s electricity, down 2% on 2019 levels.

Under the ‘step change’ scenario, Australia will meet its net-zero policy commitments while accounting for technological advances and considering government ambitions and consumer preferences.

The model also flagged the likelihood that all coal-generated electricity will be scrapped by 2043.

AEMO CEO, Daniel Westerman commented on the scenario, saying:

This transformation will efficiently deliver secure, reliable and affordable electricity while substantially contributing to national emissions objectives.

In fact, all scenarios modelled found coal-fired power used in Australia would be significantly reduced by 2030. On top of that, all found coal-fired power was set to be removed from the electricity market completely by 2050.

The post Why is the Whitehaven (ASX:WHC) share price hitting the dirt today? appeared first on The Motley Fool Australia.

More reading

• Morgan Stanley: don’t miss this with the Whitehaven (ASX:WHC) share price
• Why Webjet, Whispir, Whitehaven Coal, and Woodside shares are pushing higher
• ASX 200 coal shares unfazed by Johnson’s ‘death knell’ amid record prices
• Why BrainChip, HT&E, Platinum, and Whitehaven Coal are dropping
• Here’s why ASX 200 coal shares are in the spotlight 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 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 Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) looks like it wants to end the trading week on a low point this Friday. At the time of writing, the ASX 200 is down by 0.59% at 7,341 points.

But rather than dwelling on that, let’s instead check out the ASX 200 shares currently topping the market’s volume charts, according to investing.com.

3 most active ASX 200 shares by volume this Friday

Nine Entertainment Co Holdings Ltd (ASX: NEC)

Media giant Nine is our first ASX 200 share experiencing high volumes this Friday. In Nine’s case, a hefty 9.45 million shares have traded thus far today. It’s not quite clear why this is the case. There have been no major developments out of the company today. And the Nine share price hasn’t made any dramatic moves. It’s currently sitting at $2.90, up 0.35% so far today.

However, we have seen some significant volatility here. Nine shares have been as low as $2.83 and as high as $2.192 after opening at $2.90 this morning. Perhaps this volatility is behind the elevated trading volume we see.

South32 Ltd (ASX: S32)

Diversified ASX 200 mining company South32 is next up. This resources giant has had a sizeable 10.72 million of its shares find new owners thus far today. Again, there’s not much going on in the South32 news department this Friday. However, South32 shares are still up a healthy 1.45% so far today at $3.36 each. We covered a positive broker report on South32 yesterday as well, so perhaps that is in play too.

Sydney Airport (ASX: SYD)

Sydney Airport is our last and most traded ASX 200 share thus far this Friday. A chunky 14.53 million SYD shares have been bought and sold so far today. Not much is happening with the Sydney Airport share price today. It’s currently at $8.60, up 0.12%.

However, this company has been flying around the ASX boards this week, ever since we found out that the Australian Competition and Consumer Commission (ACCC) announced it would give the green light to Sydney Airport’s proposed takeover offer from Sydney Aviation Alliance. That might be what’s going on today.

The post These 3 ASX 200 shares are topping the volume charts on Friday appeared first on The Motley Fool Australia.

More reading

• Brokers name 3 ASX shares to buy today
• ASX 200 (ASX:XJO) midday update: Fortescue CEO steps down, Westpac buyback update
• 2 highly rated ASX 200 shares to buy
• If this is poker, we’re now ALL-IN on ASX shares: expert
• 5 things to watch on the ASX 200 on Friday

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 Bruce Jackson.

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The Douugh Ltd (ASX: DOU) share price is nosediving during Friday afternoon. This comes after the financial wellness app provider released its share purchase plan (SPP) offer booklet to investors.

At the time of writing, the Douugh share price is 7.1 cents, down 8.97%. It has fallen by 15% in the past week.

Share purchase plan details

ASX investors are selling Douugh shares after the company invited retail shareholders to participate in its SPP.

Following the successful $8 million placement, Douugh has extended its offer to eligible shareholders. Under the SPP, investors can apply to buy a parcel of shares at a price of 7.2 cents.

The same terms offered in the placement represent a discount of 13.2% on the closing price on 1 December (to be eligible for the SPP). This is also an 18% discount to the volume-weighted average Douugh share price over the 5 days before the company announced the SPP.

Investors can apply for a minimum application amount of $2,000 up to a maximum application amount of $30,000.

The company is seeking to raise $2.5 million through the SPP. However, Douugh may scale this back or increase it depending on the total value of the applications.

Together with the placement, Douugh aims to capitalise on the strong momentum experienced since August 2021. Douugh will use the funds to accelerate user and revenue growth by investing in research and development as well as marketing initiatives.

The closing date for the SPP is 23 December. The new Douugh shares will be issued on 4 January 2022. They will be tradeable from the following day.

Douugh share price snapshot

Over the past 12 months, the Douugh share price has plummeted in value by about 70%. Year-to-date has been just as disappointing, down by almost 60% after investor sentiment waned.

Based on today’s price, Douugh commands a market capitalisation of $32.21 million with approximately 453.71 million shares on issue.

The post The Douugh (ASX:DOU) share price is sinking 9% on Friday. Here’s why appeared first on The Motley Fool Australia.

More reading

• Why the Douugh (ASX:DOU) share price is sinking 10% today?

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 Bruce Jackson.

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It has been another busy week for Australia’s top brokers. This has led to the release of a large number of broker notes.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Allkem Ltd (ASX: AKE)

According to a note out of Citi, its analysts have retained their buy rating and lifted their price target on this lithium producer’s shares to $12.00. Citi likes Allkem, previously known as Orocobre, due to its exposure to sky high lithium prices through its operations in Western Australia and Argentina. The Allkem share price is trading at $8.71 on Friday afternoon.

Life360 Inc (ASX: 360)

A note out of Bell Potter reveals that its analysts have retained their buy rating and lifted their price target on this app maker’s shares to $16.25. This follows news that Life360 is acquiring items tracking company Tile. Together with its recent acquisition of Jiobit, Bell Potter believes Life360 is well positioned for growth. For example, the broker is forecasting revenue of US$247 million in FY 2022 and then US$334 million in FY 2023. The Life360 share price is fetching $11.65 today.

South32 Ltd (ASX: S32)

Analysts at Morgans have upgraded this mining giant’s shares to an add rating with an improved price target of $4.10. According to the note, Morgans has adjusted its forecasts to reflect the acquisition of a stake in the Sierra Gorda copper mine in Chile. Outside this, the broker likes South32 due to the diversity of its operations and its generous dividend yield. The latter is expected to be +7% in FY 2022 at current levels. The South32 share price is trading at $3.84 today.

The post Brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

More reading

• Why Morgans upgraded South32 (ASX:S32) shares to a buy rating
• Why is the Allkem (ASX:AKE) share price in the spotlight this week?
• Here’s why the Life360 (ASX:360) share price is leaping 12% today
• Why Life360, Oil Search, Telix, and Zip shares are storming higher
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor James Mickleboro owns Life360, Inc. and Allkem Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Life360, Inc. 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 Bruce Jackson.

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Shares in Aussie fund manager Pengana Capital Group Ltd (ASX: PCG) are higher in afternoon trade, up 2.37% at $2.17. But, Pengana has had a topsy-turvy day on the share market, after opening slightly in the red before fluctuating up and down to its current share price. It has traded as high as $2.17 and as low as $2.09.

Meanwhile, S&P/ASX 200 Index (ASX: XJO) has beejn having a dissapointing day in the red today, currently down 0.55%

It seems that investors have had mixed feelings after the company released its monthly funds under management (FUM) growth. Whilst it was a short and sharp update, let’s still take a quick look.

What does the FUM release say?

In the 1 page FUM report, the company showed it has grown FUM by approximately 1.5% from October to November 2021.

In total, the firm now has $4.15 billion in managed funds, up from $4.0885 billion at the same time last month. Looking at the same comparison rolling into October this year, this is a greater step up in capital from $4.08 in FUM during September.

The announcement also follows a white paper compiled by the group last month that challenges assumptions on the effect of impact investing in secondary markets.

Pengana pushes back at the notion that secondary markets such as the share market are an appropriate domain for impact investing, as shares frequently change hands amongst owners and the companies involved don’t directly profit from the sale or purchase of its shares.

It also questions the role of ESG investing and submits that it is more a function of managing risk versus “trying to get companies to be better corporate citizens”.

Specifically, Pengana reckons that “ESG investing processes may indeed help to avoid risk…but this is not the same as reducing impact in the real world”.

It says that “divesting a portfolio of carbon stocks is a good way to decarbonise a portfolio, but this divestment does little to decarbonise the economy”.

Pengana also argues that divestment can have important socio-political ramifications but recognise that divestment itself will have little immediate effect on carbon emissions.

Whilst the report is in no way price-sensitive, it does give insight into the investment philosophies of the firm in this regard, plus some unique perspective on ESG investing.

Pengana Capital share price snapshot

Pengana shareholders have enjoyed an outsized return over the past 12 months to date. In that time, the share price has gained 34%, well ahead of the benchmark ASX 200’s gain of around 10%.

This year to date, shares have rallied another 33%, once again leading the broad index, whilst also gaining another 8% in the last month.

The post Why is the Pengana Capital (ASX:PCG) share price struggling today? appeared first on The Motley Fool Australia.

More reading

• The Douugh (ASX:DOU) share price is sinking 9% on Friday. Here’s why
• Brokers name 3 ASX shares to buy today
• Why the Ironbark Zinc (ASX:IBG) share price is rocketing 23% today
• Top broker: The Bubs (ASX:BUB) share price has more than 20% upside
• Why Afterpay, AVZ, Irongate, and Santos shares are dropping

The author has no positions 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 Bruce Jackson.

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The Ironbark Zinc Limited (ASX: IBG) share price has reached a multi-year high after the stock exited its trading halt. This comes after the ASX minerals explorer announced an update on its recent capital raise this morning.

At the time of writing, Ironbark Zinc shares are up a sizeable 23.4% to 5.8 cents apiece. This means that in the past week alone, the shares have risen by 45% in value.

Ironbark completes share placement

ASX investors are buying up Ironbark Zinc shares as the company seeks to progress the development of its Citronen Zinc-Lead Project in Greenland.

In its release, Ironbark Zinc announced it has received firm commitments for its placement to raise $4 million (before costs). The company highlighted that it has very strong support from both existing and new institutional investors.

The offer will see approximately 90.91 million new ordinary Ironbark Zinc shares issued at a price of 4.4 cents each. This represents a 2% discount to the 5-day volume-weighted average price (VWAP) up until 6 December.

Ironbark Zinc will use the proceeds to support its post-Preliminary Project Letter (PPL) phase 2 due diligence with US financier EXIM bank.

The company is aiming to advance the Citronen Project strategic equity process to bring the asset online. The ASX minerals explorer describes the high-grade project as one of the world’s largest untapped zinc-lead resources.

The project is currently in the early stages of development. Ironbark estimates that the project contains more than 13 billion pounds of zinc and lead. Ironbark says the open-pit mine life should be 14 years.

The new Ironbark Zinc shares are scheduled for settlement on 16 December after quotation on the following day.

What did management say?

Ironbark Zinc managing director, Michael Jardine, commented:

Ironbark is now closing 2021 in an excellent position with an EXIM PPL in hand and funding in place to further advance our key value drivers early in 2022.

There was huge demand bid into the book yesterday, in a strong validation of the Company’s now advanced financing strategy to get Citronen into production.

I am pleased to see certain…larger existing shareholders add to their position, including IBG’s largest shareholder in UK based Bennelong Resource Capital, as well as welcoming several new institutional shareholders to the register.

About the Ironbark share price

The Ironbark Zinc share price has pushed 93% higher in the past 12 months. When looking at year-to-date figures, Ironbark Zinc’s share price gains are hovering at about 190%.

Based on valuation grounds, Ironbark Zinc presides a market capitalisation of $70.1 million, with roughly 1.21 billion shares outstanding.

The post Why the Ironbark Zinc (ASX:IBG) share price is rocketing 23% today appeared first on The Motley Fool Australia.

More reading

• Top broker: The Bubs (ASX:BUB) share price has more than 20% upside
• Why Afterpay, AVZ, Irongate, and Santos shares are dropping
• Johns Lyng (ASX:JLG) share price in focus amid capital raise and major US acquisition
• Bitcoin (CRYPTO:BTC) sinks again. Who’s going to catch that falling knife?
• Why is the Laybuy (ASX:LBY) share price rocketing 42% today?

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 Bruce Jackson.

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The Bubs Australia Ltd (ASX: BUB) share price has more than 20% upside from where it is today.

Bubs is one of the leading Australian infant nutrition businesses with a number of products including goat infant formula, organic grass-fed cow infant formula, organic infant snacks, and vitamins.

Broker’s bullish rating for the Bubs share price

Whilst Bubs shares have declined by 27% over the past year, a top broker thinks it can make a good recovery.

Citi has a price target on the business of $0.58, which is currently 23% higher than where it is right now. The broker thinks that the outlook is improving for Bubs and that the business can expand geographically and launch new products.

Bubs’ recovery

In the first quarter of FY22, total gross revenue nearly doubled to $18.5 million. This was growth of 96% year on year and 45% quarter on quarter.

Management said that the revenue growth was achieved across its key business segments, overcoming COVID-19 disruptions and a challenging macro environment.

The higher margin Bubs infant formula gross revenue increased 124% year on year and went up 64% quarter on quarter.

Bubs was particularly pleased with the level of growth with its China-facing businesses, total revenue here went up 156% year on year and 98% quarter on quarter. Infant formula daigou sales rose 648% year on year and 265% quarter on quarter. Cross-border e-commerce sales rose 49% year on year and 19% quarter on quarter.

Its global expansion strategy is advancing with established entities in New Zealand, China and the USA.

International revenue, outside of China, experienced growth of 489% year on year and made up 24% of quarterly sales. Export sales of Bubs infant formula to markets outside of China went up 154%.

Bubs is also ramping up its business to business services with Deloraine Dairy Solutions, with the aim of being a specialist dairy solution for co-manufacturing and end to end product development for global customers. It contributed 17% of FY22 first quarter revenue (a 16-fold increase year on year).

Outlook

Investors often take into account the outlook for a business, so the Bubs outlook could influence the Bubs share price.

The company wants to grow in numerous countries and regions outside of Australia and China, including Vietnam, Malaysia, Singapore, USA, Europe, the Middle East and Africa.

The Bubs executive chair Dennis Lin said:

We continue to explore opportunities to stretch the Bubs brand to cater to new market segments, adjacent categories and consumer groups.

In light of that, we are confident that our vision to take Bubs to a global stage is becoming a reality…having recovered the ground lost due to COVID-19 disruption, we expect to be able to sustain continued growth momentum, to the extent our forward approach does not depend on a material improvement in the pandemic setting.

The post Top broker: The Bubs (ASX:BUB) share price has more than 20% upside appeared first on The Motley Fool Australia.

More reading

• 2 promising and rapidly growing ASX growth shares
• What turned the Bubs share price sour on Wednesday?

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended BUBS AUST FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is on course to end the week in the red. In afternoon trade, the benchmark index is down 0.6% to 7,337.7 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Afterpay Ltd (ASX: APT)

The Afterpay share price is down 4% to $96.07. This follows another poor night of trade for the Square share price. As Square is hoping to acquire Afterpay in an all-scrip deal, the value of the takeover falls when its shares decline. Unfortunately, the Square share price has fallen so much recently that its offer now represents a premium of less than a 1% to the Afterpay share price prior to the offer.

AVZ Minerals Ltd (ASX: AVZ)

The AVZ share price is down over 8% to 59 cents. This morning the lithium developer announced the completion of its institutional placement. AVZ has received firm commitments to raise $75 million (before costs) at a 22% discount of 50 cents per new share. These funds will be used to progress towards a Final Investment Decision (FID) for the commencement of project development at the Manono Lithium Project in the Democratic Republic of the Congo.

Irongate Group (ASX: IAP)

The Irongate share price is down 5% to $1.57. This decline has also been driven by a capital raising. This morning the real estate investment trust announced the completion of a $50 million institutional placement. These funds were raised at a 6.3% discount of $1.55 per new share. Management will use the proceeds to partly fund the acquisition of an office building located at 510 Church Street, Cremorne VIC.

Santos Ltd (ASX: STO)

The Santos share price is down 3% to $6.43. This is despite the energy producer announcing that its merger with Oil Search Ltd (ASX: OSH) has become effective today. Oil Search shareholders will receive 0.6275 new Santos shares for each Oil Search share held on the record date of 14 December 2021.

The post Why Afterpay, AVZ, Irongate, and Santos shares are dropping appeared first on The Motley Fool Australia.

More reading

• Done deal: Santos (ASX:STO) and Oil Search (ASX:OSH) merger becomes effective
• The Afterpay-Square takeover deal is worth $9bn less now
• Could this ASX share really be the next Afterpay (ASX:APT)?
• ASX 200 (ASX:XJO) midday update: Fortescue CEO steps down, Westpac buyback update
• Why is the AVZ (ASX:AVZ) share price crashing 15% today?

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. owns and has recommended AFTERPAY T FPO. The Motley Fool Australia owns and has recommended AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Johns Lyng Group Ltd (ASX: JLG) share price is still in the freezer as the company undergoes a $230 million equity raising ahead of what could end up being a US$202 million acquisition.  

The company will be acquiring Reconstruction Holdings Inc, a United States (US) insurance provider focused on repairs to occupied properties.

At the time of writing, the Johns Lyng share price is halted at $7.14. It’s not expected to trade until the market opens on Monday.

Let’s take a look at the latest news from the building services group.

Johns Lyng’s latest acquisition

The Johns Lyng share price entered a trading halt on Tuesday ahead of the company buying into what’s estimated to be a US$100 billion market.

The acquisition is set to cost US$144 million, plus a potential earn-out of up to US$58 million.

According to the company, the purchase provides an established, profitable, and growing platform to leverage its insurance services in the US.

The acquisition is also expected to leverage and enhance Johns Lyng’s US footprint with its Steamatic business.

Reconstruction Holdings ‘ subsidiary, Reconstruction Experts has a developed model in 4 US states, with authorisations to work in 13 others. Its primary customer base is homeowner associations.

It brought in around US$127.4 million of revenue and US$18.5 million of earnings before interest, tax, depreciation, and amortisation (EBITDA) in the financial year 2021.

Around 80% of its revenue came from defect and damage insurance-related work, with the rest coming from repairs and maintenance work.

What did management say?

The purchase of Reconstruction Holdings follows an 18-month long search for a platform to expand Johns Lyng’s reach in the US. The company’s CEO, Scott Didier commented:

We were attracted to Reconstruction Experts as a platform for our US growth strategy, given the strong culture of its key management team members with whom we have built close relationships over the last few months while reviewing this transaction.

The management team has built an impressive business which has reached an inflection point in its scale and growth.

Johns Lyng share price frozen amid $230 million capital raise

To fund the acquisition, its costs, and to ensure financial flexibility following it, Johns Lyng is undergoing a capital raise.

It involves a $187.5 million institutional placement and a $42.5 million entitlement offer.

The entitlement offer will see new shares going for $6.80 apiece. The placement will be undertaken at a variable bookbuild price, with the floor price being $6.80.

That represents a 4.8% discount on the company’s current share price and a 7.2% discount on its 5-day volume weighted average price.

The entitlement offer will see existing shareholders able to buy 1 new share for every 35.91 shares they hold.

Trading update and management changes

The market also might be eying the Johns Lyng share price following a trading update from the company.

Within the update, Johns Lyng upgraded its guidance for the financial year 2022.

The company expects its acquisition will contribute $96.9 million of revenue and $13 million of EBITDA over the 6 months ending 30 June 2022.

Thus, the company expects to achieve revenue of $732.3 million and EBITDA of $73.1 million in financial year 2022.

The new guidance includes existing known run-off work from recent CAT events. Though, is not a forecast for future potential CAT events.

Additionally, the company has decided to implement a management restructure.

From 1 January, Didier will take up the role of global CEO. He will co-reside between Melbourne and Reconstruction Expert’s headquarters in Denver.

The current chief operating officer (COO), Lindsay Barber, will also pick up a new hat, assuming the role of global COO.

Finally, current executive general manager Nick Carnell will step up to be the company’s Australian CEO.

Right now, the Johns Lyng share price is 121% higher than it was at the start of 2021.

The post Johns Lyng (ASX:JLG) share price in limbo amid capital raise and major US acquisition appeared first on The Motley Fool Australia.

More reading

• What’s going on with the Johns Lyng (ASX:JLG) 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 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 Bruce Jackson.

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Bitcoin (CRYPTO: BTC) is down 4% over the past 24 hours, currently trading for US$48,426 (AU$68,201).

The world’s biggest crypto by market cap is down 14% over the past week and down 26% since this time last month.

And since we’re throwing stats at you, Bitcoin has now tumbled 30% since 10 November’s fresh record high of US$68,789, according to data from CoinMarketCap.

Even with those kinds of price moves, the token is still up 65% year-to-date. Which has many crypto investors pondering…

Who’s going to catch the Bitcoin falling knife?

You’ve probably heard the old investor adage, ‘Don’t try to catch a falling knife.’

It’s a great saying as it brings a very vivid, potentially painful image to mind. It cautions about trying to buy a company who’s share price has been, and still is, falling fast. While the company may be poised for a rebound, it could still fall much further. According to the adage, wait for some sign that the bottom is in before investing.

Cate Faddis, president of Grace Capital, used the adage to warn of dangers she sees in the broader crypto market. (Ethereum (CRYPTO: ETH) is also down 6% over the past 24 hours.)

According to Faddis (quoted by Bloomberg), “The problem with crypto is, who’s going to catch that falling knife?” “I am very concerned about crypto – honestly, it reminds me of ’08 with the real estate and it could spread to the entire market.”

Chuck Cumello, CEO of Essex Financial Services, also sounded a note of caution, pointing out Bitcoin’s wild volatility. “People have to understand truly, in my opinion, what it is. It’s a speculative investment. A more mainstream investment doesn’t drop 20% on a weekend. That just doesn’t happen.”

The bullish case

Plenty of crypto bulls remain optimistic about the price outlook for Bitcoin.

Bloomberg Intelligence’s Mike McGlone agrees Bitcoin is still a risk asset but says it is gradually evolving in a digital reserve asset “in a world going that way”.

“The key question nearing the end of 2021 is whether Bitcoin is too hot. Our chart shows the crypto fairly priced at about its upward-sloping 50-week moving average,” McGlone said.

With crypto adoption still rising, McGlone forecasts Bitcoin could hit US$100,000 in 2022.

The post Bitcoin (CRYPTO:BTC) sinks again. Who’s going to catch that falling knife? appeared first on The Motley Fool Australia.

More reading

• Is the RBA about to join the digital currency revolution?
• Why the Bitcoin price declined over the last 24 hours
• Survey reveals surprising crypto swing as Aussie housing bubble fears grow
• Why Cryptocurrency Mining Stocks Were Up Big Today
• Can Bitcoin and other cryptos be used as an inflation hedge?

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Ethereum 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 Bruce Jackson.

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