17 July 2020

BTCUSD longs daily chart

Bitcoin volatility at multi year low, Twitter hack raises security questions - who is safe?

Twitter Hack

17 july twitter hack

The largest Twitter hack in history allowed hackers to collect over 115,000 USD in Bitcoin (BTC) late Wednesday evening. A wide range of high-profile Twitter accounts including Barack Obama, Joe Biden, Jeff Bezos, Uber, Apple, Elon Musk, and Bill Gates posted tweets soliciting BTC payments to a specified address claiming to send back double any amount sent to the address within 30 minutes. Mainstream celebrity accounts were not the only ones to get compromised as hackers targeted well known Bitcoin and cryptocurrency related accounts including Binance, TRON foundation, Kucoin, and Gemini. The attackers were able to gain access to an internal tool used by Twitter employees that effectively resets the associated email addresses of affected accounts. This made it difficult for the rightful owners to regain control. Twitter immediately halted tweets coming from “blue check” accounts to mitigate further damages. At the moment, the hackers are at large with the world watching the stolen funds on the blockchain.

Bitcoin Volatility at Historical Lows, Large Move is Eminent

As touched upon in the most recent Bitwala Market Watch, Bitcoin’s volatility is currently at historical lows. In fact, the daily Bitcoin chart indicates that the Bollinger Bands have not seen such a squeeze since November 2018. Since the beginning of May, Bitcoin has been consolidating between $8,600 and $10,200, drawing many parallels to the price action observed in late 2018. As we well know, a prolonged period of low volatility inevitably results in a violent move in either direction.

BTC/USD 2018 chart

17 july btc2018

The pattern observed in 2018 (image above) demonstrates a consolidation of price while experiencing lower highs. During this period, Bitcoin was range bound between $6,000- $6,800 for nearly 3 months. This ultimately led to the Bollinger Band Width bottoming at 0.04, shortly before Bitcoin experienced a massive breakdown in price.

BTC/USD 2020 chart

bc 17 july btcusd daily

Currently Bitcoin is locked in a similar range in terms of absolute daily percent movement, but this time the range is in the low to mid $9,000 area. One of the key differences this time around is that previously in 2018 Bitcoin was in a macro downtrend, making lower highs into the consolidation zone. Since March of 2020, price has seen extensive upside from the bottom made at ~$3,800, conversely making higher lows into the current consolidation zone (image above). The direction of the next move is unknown, but given the technicals of Bitcoin at the moment it is safe to say that there will be fireworks in the very near future.

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