Bitcoin Price Analysis: Bulls Too Confident, Too Soon

Bitcoin price analysis

After the sharp decline for Bitcoin price yesterday retesting the low $3,500s we take a closer look at whats going on with the market.


Bitcoin Price: 4-Hour Bitcoin Chart

Bitcoin price 00 has failed to regain the critical $3750 point of control so far this week and is still consolidating under it after being rejected by the $4k handle and scuppering the short term hopes of an inverse head and shoulders bottom.

Last night saw the price fall from highs of $3680 and a subsequent bounce back today, before once again being rejected and settle around $3600, but seemingly continues to be drawn towards the mid $3000s rather than pressing on to new highs.

Sentiment Analysis

Looking more closely at the market we can see that the sentiment in the market is bullish, with longs out weighing shorts by 30k to 22k at Bitfinex.

While this may suggest that the market believes that there is hope that the bottom is in and upside can be expected, the issue is that generally speaking, the longs at 30k is reaching the maximum levels the market tends to see, with these positions being built all the way down to $6k.

During this time, short positions have also closed from 40k down to 22k.

This means that despite the buying pressure of both combined, the market remains stuck around the mid $3ks, which is the 61% retracement of the bounce from $3.1k.

Looking at the total leverage exposure, this is also beginging to reach out towards the 50k lows that we have previously seen.  As highlighted on the chart, it becomes clear that where we have seen these conditions in the past, we have seen a sharp selloff to retest the lows.

Bitcoin is therefore starting to reveal some underlying weakness in its market posture and indicates that another retest of the low $3ks could be on the horizon in the near future.

With CBOE XBT futures expiring today, there may be some hope of a short term relief rally as we have seen previously but generally speaking it seems likely that Bitcoin price needs to prove its metal at the $3.1ks before we move higher.

[Disclaimer:  The views expressed in this article are the personal opinion of the author and do not reflect the views of Bitcoinist. The information in the article should not be taken as financial advice.]

To get receive updates for the writer you can follow on Twitter (@filbfilb) and TradingView.

Does Bitcoin price action suggest we will head lower? Where is the bottom? Let us know your thoughts in the comments below.


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Source: Blockchain

XRP Overtakes Ethereum Despite Looming ‘Constantinople’ Upgrade

Ethereum constantinople

XRP has reclaimed the position of the second largest cryptocurrency by market cap from ETH just days before Ethereum’s ‘Constantinople’ hard-fork upgrade. 


Pre-Fork Drop

On January 16th, Ethereum is scheduled to undergo a network-wide system update called ‘Constantinople’. Among other things, the implementation of the upgrade will reduce the block reward from 3 ETH/block to 2 ETH/block.

Days before the event, however, Ethereum’s (ETH) 00 price experienced a notable decline.

In a matter of minutes, ETH price dropped by about 8 percent.

The movement caused ETH to fall behind Ripple (XRP), which reclaimed its spot as the second largest cryptocurrency by means of market capitalization, less than two weeks after Ethereum regained the number two spot from XRP.

In fact, the two have been neck and neck over the past few months in cryptocurrency market cap rankings.

XRP 00 also experienced a decrease around the same time, but the cryptocurrency experienced a relatively smaller loss of 2.5 percent against the USD.

Ethereum’s ‘Constantinople’

Constantinople is a system upgrade scheduled for implementation at block 7,080,000. Given the current average block time, the event should take place on January 16th, 2019.

One of the most discussed changes that the upgrade will cause is the reduction of block reward from the current 3 ETH/block to 2 ETH/block. This is also referred to as the “thirdening.” It’s the second time Ethereum’s block rewards have been reduced.

The first one was called “Byzantium” and it took place on October 16th, 2017. Back then, ETH surged by about 6 percent during the day, followed by the cryptocurrency’s late 2017 rally to an all-time high of about $1,400.

In total, the upgrade will integrate 5 Ethereum Improvement Proposals (EIPs), which are geared toward tackling cost, speed, functionality, and mining issues.

Support For ‘Constantinople’

Several cryptocurrency exchanges have announced their support for the upcoming network upgrade.

Binance, HitBTC, Huobi, Bittrex, OKEx, CEX.IO, Cryptopia, and Poloniex, have all announced that they will support the Constantinople hard-fork.

Most of them advise users to give sufficient time for their deposits to be processed prior to the upgrade.

At the time of writing this, Gemini, Coinbase, and Bitfinex, haven’t yet declared their support for the upgrade.

What do you think about Constantinople and its impact on Ethereum? Don’t hesitate to let us know in the comments below!


Images courtesy of Shutterstock; TradingView

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Source: Blockchain

Russia Plans to Ditch US Dollar for Bitcoin, Says University Professor

Russia Putin

A Russian university lecturer with ties to the government says the Kremlin will soon begin investing massively in Bitcoin as a way of avoiding new U.S. sanctions, a move that could happen “in a matter of weeks.”


Russia to Buy Some ‘Digital Gold’?

Speaking exclusively to Micky, Vladislav Ginko of the Russian Presidential Academy of National Economy and Public Administration believes new U.S. sanctions will push the Kremlin into diversifying its cash reserves into Bitcoin.

Ginko who has ties with the government going back more than 20 years says the move will happen in a matter of weeks. Ginko has in recent times appeared on various Russian media platforms clamoring for the adoption of Bitcoin as a haven asset.

Commenting on the issue, Ginko said:

US sanctions may be mitigated only through Bitcoin use. Because of US sanctions, Russia’s elite is forced to dump US assets and US dollars and invest hugely into Bitcoins. The central bank of Russia sits on $466 billion of reserves and has to diversify in case there are limited opportunities to do it (in the future).

Cutting Dollar Dependence Amid New U.S. Sanctions

Along with China, Iran, and Venezuela, Russia is exploring ways to reduce its US Dollar dependence. Back in November 2018, Russian President; Vladimir Putin, declared that in the wake of new sanctions, the country had no choice but to cut down on its use of the Dollar in international trade.

At the time, President Putin said:

We have no goal of moving away from the Dollar. It’s the dollar that’s moving away from us. Those making such decisions are not shooting themselves in the foot, but somewhere more delicate, further up the body.

According to Ginko, the Kremlin will, beginning in February 2018, look for ways to diversify its reserves. Ginko has in recent times appeared on various Russian media platforms clamoring for the adoption of Bitcoin as a haven asset.

Russian Efforts

If the Russian government and the elite class invest massively in Bitcoin, the price of the asset could experience a sudden upward surge. Such a situation occurred in 2018 when wealthy Chinese citizens reportedly moved money into BTC in the wake of an accelerated currency devaluation by Beijing.

Meanwhile, the Kremlin has been stocking up on non-digital gold as a shield against economic sanctions. Reports indicate the government is selling U.S. government debt in exchange for the precious metal. By August 2018, Russia had already tripled its gold reserve as it gears up for renewed economic tussles with the U.S.

Such is the extent of Russia’s gold-gobbling that global gold purchasing figures reached a three-year high in November 2018. The Kremlin is also pursuing closer economic ties with China to create a new payment system independent of the Dollar.

Will massive Bitcoin investment by the Kremlin lead to any surge in the price of Bitcoin? Let us know your thoughts in the comments below.


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Source: Blockchain

Fred Wilson: 2019 Will Find the Bottom and ‘Slowly’ Enter a Bull-Run

Fred Wilson Union Square Vetures

Fred Wilson, the co-founder of Union Square Ventures, holds that 2019 will see the cryptocurrency market bottom out and ‘slowly’ enter a new bull run. However, he’s also concerned by actions of ‘misguided’ regulators. 


2019: Finding the Bottom

Venture capitalist and co-founder of investment firm Union Square Ventures, has laid down his predictions on the overall state of the cryptocurrency market in 2019.

The investor believes that we are currently in the process of bottoming out. However, he thinks that this would take much of 2019 but it will be followed by “some bullish runs.”

I expect we will see some bullish runs, followed by selling pressures taking us back to retest the lows. I think this bottoming out process will end sometime in 2019 and we will slowly enter a new bullish phase in crypto.

Unlike others who’ve based their positive predictions on catalysts such as further market adoption, institutional money entering the market, infrastructure, and so forth, Wilson sees the premise of a new bullish run in the face of the results of promises made back in 2017.

I think the catalyst for the next bullish phase will come as the result of some of the many promises made in 2017 coming to fruition in 2019 […] I think we will see a number of “next gen” smart contract platforms ship and challenge Ethereum for leadership in this super important area of the crypto sector.

Another area where Wilson thinks 2019 will bring ‘meaningful progress’ and further adoption is stablecoins. He’s not alone on the matter.

Bitcoinist reported earlier in November that CoinJar’s co-founder Asher Tan also believes in the potential of stablecoins to solve the problem of volatility in the cryptocurrency space.

Regulatory Concerns

The venture capitalist also shares that there will be pressure on the cryptocurrency industry, in general. According to him, it will stem from ‘misguided regulators’.

The area I am most concerned about are actions brought by misguided regulators who will take aim at high quality projects and harm them.

Back in October, industry proponent Jeremy Allaire, CEO of investment application Circle, called for globally coordinated cryptocurrency regulations. At the same time, the Chairman of the US Commodity Futures Trading Commission (CFTC) J. Christopher Giancarlo urged regulators to apply a “do no harm” approach to cryptocurrency legislation.

Last but not least, Wilson thinks that scams, hacks, and overall failures are going to remain a “drag on the sector.” However, he also holds that this is normal and ‘always the case’ with emerging tech.

What do you think of Fred Wilson’s prediction of the cryptocurrency industry’s condition in 2019? Don’t hesitate to let us know in the comments below!


Images courtesy of Shutterstock, Wikipedia.org

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Source: Blockchain

Cryptocurrencies Get ‘Santa Rally’ To the Envy of the Stock Market

santa rally bitcoin price cryptocurrency

As the final week before Christmas comes to a close, the cryptocurrency market closes out a well needed ‘Santa Rally’ to the envy of the traditional markets, we take a closer look at what happened with the top cryptos and if an end is in sight to the twelve-month bear market.


Christmas Santa Rally for Crypto

The total cryptocurrency market cap managed to find support around the $100bn valuation level last week and rallied hard to close up around 30% at $130bn with a large bullish engulfing candle and a noticeable uptick in volume. A move of such positive magnitude has not been seen since the first week of April 2018 and it certainly feels a like long time in the cryptocurrency world.

Moving into the early hours of Monday morning, the market did not let up steam and pushed ahead with another 10% towards $143bn.  While this goes some way towards signaling that buyers are returning to the market and that demand at these prices may outweigh supply, there is a significant amount of work to be done before we can say with conviction that this market – which has suffered staggering losses of $650bn (87%) – has bottomed.

Christmas Eve gains across the board

Each of the top cryptocurrencies saw significant gains, with XRP 00 being the biggest mover over 20%. Notable gains were seen across the board, with six of the top ten coins making double-digit gains and tether falling as people ditched the USD equivalent for the soaring cryptocurrencies.

Bitcoin Daily Chart

After finding its legs just north of $3k, the market leader, Bitcoin, has found some resistance around the 23.6% retracement level at $4k. But it convincingly broke out of this overnight and is now eyeing $4.4k, which is where significant resistance was previously found after a bounce following the initial test of the mid $3ks.

This has a high probability of proving to be a significant level of resistance with a backtest of $4k, which must now turn from previous resistance to support.

For this market to show real signs of interim bullishness, however, Bitcoin price really needs to see a convincing attempt to break $4.5k on the first try.  Should BTC be able to consolidate around this level, the bulls will be eyeing just north of $5.2k at the 61.8% retracement of the fall from $6.5k where there will be significant profit taking and short interest.

While Bitcoin and many of the other cryptos have has managed to provide some relief for investors and savvy dip buyers, this market has a lot of work to do to become bullish.

The high probability is that Bitcoin will struggle to retake the $6k and will need to spend some time holding and building a base above $3k. There is also still a week to go for some investors to crystallize losses and recognize them on their tax returns, which may still have a downward effect on the market.

So while the much needed ‘Santa rally’ has brought some Christmas cheer to the crypto markets, traders will be looking for signs of strength, with all of the coins needing to find higher highs and proving resistance at each of the key Fibonacci levels can turn to support with at the first time of asking.

Does Bitcoin price suggest it is now a buyers market? Where is the bottom? Let us know your thoughts in the comments below.

[Disclaimer:  The views expressed in this article are the personal opinion of the author and do not reflect the views of Bitcoinist. The information in the article should not be taken as financial advice.]

To get receive updates for the writer you can follow on Twitter (@filbfilb) and TradingView.


Images courtesy of Shutterstock, Tradingview.com

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Source: Blockchain

Study: Asia Has More Impact on Bitcoin Price Than America and Europe

asia shanghai bitcoin price

With events like SEC approval for Bitcoin ETFs and the introduction of cryptocurrency derivatives, it is easy to imagine the market being driven by news out of the United States. However, new research suggests that Asia, and not the West, is the dominant driver of Bitcoin price and cryptocurrency markets.


Western Focus Might be Misleading

Jay Clayton, the Chairman of the United States Securities and Exchange Commission (SEC) commented back in June 2018 as part of his comments about the Commission’s stance on whether cryptocurrencies where securities or not, saying:

We’ve (the SEC) been doing this for a long time, and we’ve built a $19 trillion economy, a securities market that is the envy of the world, following these rules.

While it is true that the Western hemisphere exerts a lot of dominance over the mainstream asset market, the same doesn’t necessarily apply to Bitcoin and the altcoin market. However, it isn’t unusual to see US-based “trading experts” to argue that things like the CME and CBOE BTC futures are driving Bitcoin price 00.

According to Mosaic, a cryptocurrency data and research firm, developments in Asia exert a significantly greater effect on the virtual currency market than the ones from the Western part of the globe.

The research firm says there have been 11 major news developments from Asia concerning cryptocurrencies. These headlines impacted the market by an average of 18.61 percent.

The most significant of these developments came at the beginning of the year when CoinMarketCap removed data from South Korean exchanges. According to Mosaic, this singular event crashed the market by more than 57 percent.

Back in mid-2018 when BTC price rallied from $6,200 to $8,000, many commentators pointed to news coming out of Asia. At the time, wealthy Chinese citizens turned to Bitcoin as a haven as the government accelerated the devaluation of its currency.

Asia Dominates Mining and Cryptocurrency Exchange

To start with, Asia dominates both the mining and exchange landscape. Even with the crackdown by China, other places like Singapore, Hong Kong, Japan, and South Korea are hotspots for numerous cryptocurrency exchange platforms and related businesses.

Why is this information relevant? Well, apart from the apparent trading volume conclusion, there is also the language component. These Asian exchanges make sure their services are offered in their local languages, bringing trading closer to the local population. With relatively cheaper electricity, the region (especially China), is still a dominant player in the bitcoin mining industry.

Hong Kong cryptocurrency

Earlier this year, Arthur Hayes, CEO of Hong Kong-based BitMex platform, said that crypto trading in Asia is more developed than in the West.

“Asia dominates cryptos because they’re very used to digital trading assets. South Korea has been trading digital goods related to gaming for two decades. When you move to a purely money based digital currency, they understand that culturally, so they get on board quickly,” he said. Therefore, it stands to reason that news out of that region would have a much greater sway on the market than in the US and Europe.

The researchers conclude that due to the “pivotal role” Asia plays in cryptocurrency, “investors seeking a better idea of what drives crypto prices would do well to look East.”

Will an influx of US-based institutional investors shift the tide of dominance towards the Western hemisphere? Please share your thoughts with us in the comments below.


Image courtesy of Mosaic.io., Shutterstock

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Source: Blockchain

FAANG Stocks Lose Over $1 Trillion – More Than All Cryptocurrencies Combined

FAANG stocks crash

Facebook, Amazon, Apple, Netflix, and Google stocks have together shed over $1 trillion in market capitalization from their all-time highs, marking an even bigger loss in dollar value than all cryptocurrencies combined in 2018.


FAANGs Lose Bite

Bitcoin and cryptocurrencies, in particular, are not the only bubble in town.

Stocks of tech stalwarts like Google, Amazon, and Facebook, collectively knowns as FAANG, have lost over $1 trillion USD in market capitalization from their all-time highs.

Comparatively, despite a nightmare year for cryptocurrencies, the total cryptocurrency market cap is down roughly $700 billion from its $830 billion historic high in January 2017.

total market cap

Among the FAANGS, Netflix (NFLX) was the worst performer, down -34.8% for the year (as of December 13th), followed closely by Facebook at -33.7%, according to data from Investopedia.

Apple Inc. (AAPL) didn’t fare much better amid disappointing iPhone sales, down -26.8% stock from its record price – and almost -14% in the past month alone.

Amazon.com Inc. (AMZN) is also dropped by a considerable -19.1% with Google-parent company Alphabet Inc. (GOOGL), right behind with a -16.9% drop.
 
The runup to record high valuations for FAANG shares was an impressive bull period, which appears to now have peaked in July 2018. Interestingly, this month was also the last time Bitcoin (BTC) saw prices above $8,000.

But while the ‘Bitcoin is dead’ narrative appears to be greatly exaggerated, according to a recent study from the University of Cambridge, the cryptocurrency ‘bubble’ is admittedly still relatively more severe than FAANGs’ with an 85% drop.

Everything’s Bubbling

The S&P 500 and the Nasdaq 100, for example, have fallen by a lower -9.9% and -12.1%, respectively, from their own highs compared to the FAANGs. In fact, the recent stock rout has been led by the once-red-hot FAANG as tech-oriented ETFs saw “massive outflows” in November, reports Bloomberg.

“The conditions that have allowed these kinds of high-growth stocks to outperform have changed, if not reversed,” says David Lafferty, chief market strategist at Natixis Advisors. “I just don’t see much upside.”

Similar conditions may have also allowed for this exuberance to spillover to the nascent cryptocurrency industry earlier this year. Both Wall Street and retail investors began buying into the high-risk, high-reward casino world of crypto and novel ICOs pushing the price to record highs by the end of 2017.

At the time, newly launched Bitcoin futures marked Bitcoin’s entry into mainstream finance, boosting Bitcoin price to new heights. Today, BTC price 00 is down roughly 85% from its all-time high of almost $20,000.

Bitcoin Adoption ‘Driven By Bank Failures’

Unfortunately for both stocks and cryptocurrency, Lafferty doesn’t see much hope for the near term as the central bank policy has shaken many investors.
“The Fed’s tightening is getting to where it’s starting to hurt,” he says. “GDP should decelerate in 2019, which will lead to a natural decline in earnings growth. What that means for multiples and investor sentiment is up in the air.”
paris protests buy bitcoin

Elsewhere, protests across France and slower economic growth globally as a whole could be a sign of a looming financial crisis, which in 2008 birthed Bitcoin as a decentralized and apolitical alternative to the existing financial system.

In other words, don’t be surprised to see a divergence between Bitcoin and stock market performance in the future.

Former Wall Street investor and market analyst, Max Keiser, recently told Bitcoinist that Bitcoin was, in fact, designed to thrive in times of economic turmoil. He explained:

Bitcoin adoption has always been driven by bank failures, bailouts, bail-ins, and political unrest. The problem Bitcoin has had recently is its competitor, the US Dollar, has been rising.

Ten years after its birth, it will be interesting to see if Bitcoin – which isn’t a stock or a company share but a digital protocol for transferring value – can eventually decouple from traditional markets and provide a haven during the next bust cycle.

Fundstrat Global Advisors Head of Research, Tom Lee, meanwhile recently called BTC undervalued, given its fundamentals are strong as ever.

“Bitcoin’s fair value, given the number of active wallet addresses, usage per account and factors influencing supply, is between $13,800 and $14,800,” said Lee.

In the macroeconomic climate, Lee holds that treasury sales of initial coin offerings (ICOs) are the reasons for the lower price.

Therefore, the market correction could actually prove to be healthy for Bitcoin, the most secure blockchain in the world, as unprofitable businesses and low-quality projects go belly up, leaving only the cream of the crop for the next bull-run.

Can Bitcoin thrive in the next financial crisis? Will it outperform FAANG stocks in the near future? Share your thoughts below!


Images courtesy of Shutterstock, coinmarketcap.com, thetechnicals.com 

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Source: Blockchain

Ethereum Price Analysis: Ether Burns to a Crisp

ethereum price eth price fire

Ethereum has turned into an unattended dumpster fire. Let’s take a look at the Ethereum price analysis and see what it will take to turn the price around.


Ethereum Price: Market Overview

2018 has been a rough year for Ethereum price 00 and at the moment it doesn’t look like the situation will improve. Of the top 5 cryptocurrencies, ETH price disintegration has been nothing short of harrowing and with the ICO market being declared dead by a growing number of analysts.

Meanwhile, the SEC in constant pursuit of what it deems to be unregistered securities sales and illegal marketing has put a ton of pressure keeping it from rebounding from its current lows.

ETH-USD Shorts

Additional pressure is also coming from a record high number of shorts (400,000) betting against an Ether recovery and this seems to be pinning ETH price below $95. A break above $95 – $100 could cause some shorts to cover and the price could extend to $115 to $125.

However, it seems a strong Bitcoin led recovery is the only catalyst that would set this sort of action into motion.

ETH-USD Longs

Here is the ETH/USD longs chart.

4 HR Chart

ETH had been trading in a tightening range of $83 to $103 but a decline in volume and pattern of lower highs hinted that ETH price would break down over the short-term.

ETH under $85 is a problem and below $83 – $80 could be catastrophic. The pattern of lower highs remains and ETH’s oversold bounces on the Stoch and RSI are diminishing in the amount of lost ground reclaimed.

Longs have 300,000 contracts open and a drop below $80 could accelerate ETH losses and the considerable support gap below $80 could lead to ETH price dropping to $60, if not to $41.

1HR Chart

Ethereum price dropped supports at $89, $87.60, $85.90. Now $83 – $80 appears to be the last support before a steep fall. Ambitious traders should either wait patiently for a bullish pattern to present itself or attempt to catch and oversold bounce if ETH drops below $83.

But setting a tight stop loss would be wise in order to protect against the possibility of a steep decline below $80.

[Disclaimer: The views expressed in this article are not intended as investment advice. Market data is provided by Bitfinex. The charts for analysis are provided by TradingView.]

Where do you think Ethereum price will go over the short-term? Share your thoughts in the comments below!


Images courtesy of Shutterstock, Trading View. Market data sourced from Coinbase and Bitfinex.

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Source: Blockchain