Market Watch

December 6, 2019



Key takeaways: Bitcoin price action, historical transaction volume record, pricing models suggest BTC is undervalued and new physically backed bitcoin ETP on stock exchange

BTC/USD 4hr chart

dec-06-2019

On a 4-hour chart, bitcoin price action has formed a falling wedge pattern that broke out to the upside, almost reaching its appointed target. The price went up 8%, before crushing back within a few hours. Bulls tested the height of the range, but got almost immediately rejected by bears indicating a lack of strength to break above the previous high at $7,900.

During these choppy moves, EMA ribbon lost its significance, RSI is in the mid ranges and the volume is very low. These technical indicators losing velocity preludes that we are experiencing the calm before the storm, while major transactions are happening behind the scenes.



Bitcoin transaction volume record

On December 4th, the Bitcoin network transferred $8.9 billion of transaction volume in one hour, marking the highest volume in Bitcoin’s history. This volume was caused by an amount of more than 55,000 BTC being transferred to various wallets, subsequently forwarding a slightly smaller amount to another wallet, leaving the change on the previous wallet. By continuing this, the originator of the transfer was able to split up his BTC funds in multiple small chunks paying almost no fees. The on-chain volume spike was caused by 43,564 BTC being withdrawn from Bittrex, a popular crypto exchange. What is even more noteworthy is that $313 Million worth of BTC was transferred for only a transaction cost of roughly $1.



dec-06-2019



Two BTC price models suggest the price should be higher

dec-06-2019


There are two bitcoin price models that indicate Bitcoin is currently undervalued, Stock to flow and The Mayer Multiple.

According to the Stock to flow model, the smaller the flow compared to the stock, the better the asset is in terms of value appreciation. Bitcoin has a stock of 18,085,912 coins with no inflation, which makes it a scarce asset. So far, bitcoin price has followed Stock to flow ratio quite closely, but currently it is traded below the model. This price model suggests the current price of BTC should be at $10,676.

Mayer multiple model divides the current price by the 200 daily average. It is currently at the very low levels and it suggests that the price should be at least $8,175 per bitcoin.



New bitcoin ETP launched on Swiss stock exchange

WisdomTree, a New York-based exchange-traded fund Launched a new Exchange Traded Product that is physically backed by bitcoin on Swiss exchange SIX. Alexis Marinof, head of WisdomTree in Europe said: “We have been monitoring cryptocurrencies for some time and ... have seen enough to believe that digital assets, like Bitcoin, are not a passing trend and can play a role in portfolios." The increase of ETFs and ETPs that are backed by BTC makes it easier for institutions to have exposure to bitcoin.





December 3, 2019



Key takeaways: Bitcoin continuation pattern played out, upcoming long squeeze, end of the year reflection and the rate of holders on BTC market

BTC/USD daily chart

dec-03-2019

As anticipated in our previous issue, the reversal head and shoulders pattern resulted in a bullish continuation and briefly touched the $7,800 level. Yet, further climb was stopped short by the 20-day EMA, keeping price outside and below the EMA ribbon. Bitcoin price has since declined 9% and is now supported by the 61.80% Fibonaci Retreacement level. It is important for the bulls to stay above that level, or at least within the “golden pocket” range (area in between 0.65 and 0.61).



BTC/USD weekly chart

dec-03-2019

On a weekly timeframe, there is an important event worth noting: The 50-day moving average crossed above the 100-day moving average. The last time this occurred in May 2016 resulted in a 950% price increase. This could have been an immensely bullish sign, if not for bearish divergence on the weekly RSI, which suggests the opposite. Moreover, according to weekly EMA ribbon, we are still in a bear market and bulls would require a lot of strength to break the bearish formation.



BTCUSD Longs daily chart

dec-03-2019

Bitcoin Futures long positions surged impressively during the past week. There is still some room to the upside, however, the parabolic run makes bitcoin more susceptible to a long squeeze. A long squeeze occurs when a price decline pressures BTC long holders into selling their longs which would drive the price even further down in a cascade of sell-offs.



dec-03-2019

Looking at the bigger picture as the end of the year is upon us, bitcoin price went up 100% since December 3rd, 2018, exactly one year ago. Yet, this year’s price peak ($13,800) is only 30% lower from the 2017’s all-time high. Historically BTC is known to be quite volatile on the last month of the year, as it has been making over 30% moves each year since 2015. We will watch the market closely and report on the most significant events as the month unfolds.



Over 60% of BTC hasn’t move in a year

Twitter analyst Rhythm concluded that 64% of all BTC in circulation hasn't been moved for over a year. Despite volatility and dramatic price increase since 2018, the biggest chunk has not been traded, sold or moved to another wallet. This indicates that many bitcoin investors are not in for short-term gains or speculations, but are rather truly hodlers.





November 29, 2019



Key takeaways: Bitcoin bullish signals, Bakkt new all-time high, Upbit exchange hack and PlusToken Scam

BTC/USD 4hr chart

nov-29-2019

Bitcoin broke the $7400 neckline of an inverse head and shoulders pattern. This pattern usually suggests a bullish continuation with the target being the length of the head, which would put it at approximately $8150. However, there is a major resistance level at $7800 on a 4 hourly chart which served as support all through last month before breaking October 23rd. It is still too early to say if this is a clear trend reversal to the upside. For now, the $7400ish should hold. A breach could spell further drawback towards the $6000 range of 2018.



BTC/USD daily chart

nov-29-2019

On a daily time frame, the RSI indicator supports the bullish narrative with a divergence (meaning that the indicator develops bullish with the overall price action exhibiting bearish behaviour). On the way to the presumable target, we will encounter the EMA ribbon from below, lining up with October's resistance level. It will take considerable buying pressure to enter and break the band. In case BTC price breaks below $7300, we might see an even further fall.



Bakkt volumes at new all-time high

Bakkt futures trading volume reached a new all time high ($42.52 million), which significantly outperforms previous growth (+148%). The interest of institutions that trade these contracts started to pick up with the increase of bitcoin price volatility. Bakkt was faced with very insignificant demand for its product on the day of launch which had led to concerns about the viability of bitcoin futures trading, but it looks like the market is catching on and Bakkt is on the way to becoming a player in this highly competitive landscape so far populated by mostly unregulated entities.




Upbit hack

Yet another major crypto exchange has been hacked, this time the target was South Korea based Upbit that even prior to that had encountered quite a few bumps down the road. The hackers stole $51.7 million worth of ETH from the exchange. Upbit have now suspended all deposits and withdrawals for the time being, moved all funds to cold storage and promise users to refund their losses. This case yet again servers as a reminder of the risk of storing crypto on an exchange.



PlusToken Scam

PlusToken Ponzi scheme that allegedly accumulated 200,000 BTC by scamming people could be the reason behind the recent bitcoin price fall. According to Crypto Twitter analyst Ergo, who meticulously tracks the transactions of the coins in questions, the liquidation of their BTC funds could possibly have caused BTC price to go down. He expects PlusToken to continue dumping for the foreseeable future.





November 26, 2019



Key takeaways: BTC touching previous lows, Ether still in ascending triangle, low transaction fees and blockchain investment by the EIF

BTC/USD 1D chart

btc-daily-chart


At the time of writing, bitcoin price is just touching on October 24th lows. It remains to be seen whether we can push through this resistance and subsequently approach the $7,880 support. From there we could rest and trade sideways until we break the declining upper band of the triangle. Equally, if not more likely is it that the breakout is denied and we find ourselves tumbling towards $6,000. ETH/BTC cautiously positive

ETH/BTC cautiously positive

bt eth

Even with major “altcoins”, looking at the BTC trading pair makes sense sometimes since many of the major exchanges still do not provide fiat trading in most coins. ETH/BTC still trades inside an ascending wedge. We had anticipated a strong move to the upside not long ago, and we still won’t rule it out just yet. Of course, the “bigger narrative” can throw a monkey wrench into any TA but on this we remain cautiously optimistic. Ideally, the wedge would play out with a breakout mid-December after which there should be enough headroom to test both the minor resistance at 0.025 BTC (which was the failed 2019 support) and the extended falling wedge resistance. The timeframe in which such a scenario could spans from hours to weeks. Key interim targets would be (3) making higher high than (D) and (4) making a higher low than (D) with a subsequent (5) that’s higher than (B). If we breach the lower bounds of the wedge, further pullback is likely.



BTC transactions are too expensive - nope!

Over the last week, Twitter transaction monitoring bot Whale_Alert has reported some eye-catching transactions of 44,000 BTC equal to about 310 million USD. Large HODLers are either reorganizing their wallets or depositing to exchanges. What’s interesting to note is that transactions moving hundreds of millions of USD worth of bitcoin, fees of $0.33 were paid and the transactions were confirmed minutes later! Two days later, we are looking at around 25,000 unconfirmed transactions in the mempool after a peak of up to 44,000 on November 25th. Some transactions may thus take longer than usual if you’re trying to save on fees. If you’re relying on a transaction going through within the next block, a fee of 31-32 sat/byte is advised. Meanwhile, only 31% of all transactions make use of Segregated Witness, a bitcoin transaction method that saves on fees by reducing transaction size and subsequently, fee. Bitwala has introduced native SegWit support just last week and we hope you enjoy lower fees on all your future bitcoin transactions.



New EIF scheme to invest 100 million EUR

The European Investment Fund actively supports funding of early stage startups in the blockchain and AI space. By launching an investment scheme of 100 million EUR in 2020, the EIF anticipates a total of 300 million EUR to be enabled by joining private investors. Through this initiative, Western Europe is expected to remain the second-largest region in the world for blockchain spending following the US and surpassing China.





November 22, 2019



Key takeaways: short term bearish BTCUSD scenario, ETH staking



BTC/USD daily chart



nov-22-2019



In our last installment, we anticipated a massive move and pointed out the ambivalence of signals that we received from the overarching chart narrative. The last 24 trading hours have indeed brought the anticipated move, although the direction in which it went is not generally the desired one. Looking at the weekly chart on Bitstamp, we hesitantly deduct a short- and medium term bearish picture. The support line in the 7500ish range originates from October 2017 with very but distinct connections in August 2018 (resistance) and all through 2019 (support). From April to November 2018 the price all but oscillated around this mark (in logarithmic view). After overselling in December 2018 and subsequently bouncing to 14000 in mid-year 2019, we have once more returned.



Zooming out all the way to 2016 shows a long range trend channel that the 2017 parabolic run left behind only to break it to the downside in late 2018. We bounced off the upper band of the channel in June and now find ourselves hoping for a weekly close inside or upwards of a very broadly painted triangle pattern. To achieve this, the price would have to stay above the 7500 range and subsequently follow the lower boundary of the triangle up to and beyond 8050 before the end of the year. Less desirable but more probable seems a scenario in which we end up testing the 2018 support at around 6000. If played out straightforward, this setup could then solidify 6000 as a long term support line from which we could re-attack the channel, which, while not reaching McAfee-esque estimations, would put us near 50000 at the end of next year.



ETH USD in nowhere land

nov-22-2019



On the daily chart, ETH is trading in the middle of “nowhere”, only reacting to outside inputs from the general crypto market. ETH is steadily declining in volume as investors are standing on the sidelines in anticipation of ETH 2.0 and the switch from Proof-of-Work to Proof-of-Stake. Maybe this could be a good time starting to accumulate the 32 ETH required to participate in the staking process. This could yield between 4% and 10% annual returns in ETH. For long-term believers in the crypto space and tokenization in general, this could be an interesting investment. Since the launch of ETH 2.0 and PoS is still a while away, a dollar-cost-averaging approach would make sense for most cost-conscious investors.



nov-22-2019



The ETH/BTC chart looks slightly more appealing. If ETH continues to trade within the ascending triangle and display relative strength towards bitcoin, investors could hedge against probably BTC drawdown with the increased chance of leveraging their ETH by staking them later.



German Stock Exchange tokenizing assets



Deutsche Börse, proprietor of Xetra and most other Germany-based local stock exchanges, has joined forces with Swisscom and Sygnum to invest in Custodigit AG (crypto custody) and Daura AG (tokenization and issuance for Swiss SMEs). The cooperation aims to enable Small and Medium Enterprises which are not yet listed on exchanges to issue tokenized equity for easier access to capital. This event solidifies the trend towards digitalization of assets.



It’s happening - negative fees



Following the negative interest policy by the ECB, a German bank is charging its clients with a 0,5% negative interest rate on their savings. The Bavarian-based Volksbank Raiffeisenbank Fürstenfeldbruck is the first bank to apply charges for deposits below 100,000 EUR.



Well-known crypto-exchange Binance is relocating around a 100 employees including executives such as founder and CEO Changing Zhao and CMO Yi He. Whether the moving relates to the regulatory status of cryptocurrencies and blockchain technology in China or the recent raid of the office by local police is open at the moment.



About Bitwala

Bitwala is Germany’s cryptocurrency flagship with the mission of building a bank to bridge traditional and blockchain-based finance. Based in Berlin, Bitwala offers the world’s first all-in-one platform combining a regular bank account, a Bitcoin wallet, and seamless bitcoin trading options. Our customers can easily buy and sell bitcoin - whether online or mobile - with fast liquidity directly from their bank account, hosted by a German partner bank. Bitwala only charges a competitive 1 per cent fee for every bitcoin trade.



Customers in all 31 countries of the European Economic Area can access the benefits of a German bank account. Euro deposits up to €100,000 are protected by the German deposit guarantee scheme. Moreover, the account comes with a free debit Mastercard that can be used for contactless payments and free withdrawals at 40 million ATMs and POS’ worldwide. To protect the bitcoin in the Bitwala wallet, the private keys remain in the hands of the customer. The high legal and technical standards render Bitwala one the safest and quickest ways to trade and manage Bitcoin holdings.



Bitwala was founded in 2015 by Jan Goslicki, Benjamin Jones and Jörg von Minckwitz. Christoph Iwaniez and Philipp Beer joined the management team then since. The total team presently consists of more than 40 employees. Bitwala’s investors include Earlybird Venture Capital, Coparion, Global Brain and Sony Financial Ventures, High Tech Gründerfonds, ALSTIN, and Digital Currency Group.





November 19, 2019



Key takeaways: Bitcoin breaking the EMA ribbon, stock-to-flow under scrutiny, Bank of America account of Ex-Paypal CFO closed, and checking accounts by Google.



BTC/USD daily chart

nov-19-2019



Bitcoin has sold off most of its gains from early June. We currently reside just downside of the falling trend line. We’ve broken the EMA ribbon on the daily chart, even leaving behind the reliably supportive 200-day-average. As we discussed in our last article, there is a statistical change of a breakout towards the $9,500+ range, but with day this becomes less probable.



For now, we see weak support at $7,800 which has been bought back before, but there’s a good argument to secure fiat and buy back in once that support has established once more.



Stock-to-Flow under scrutiny

Let’s revisit one of the instant classics of Bitcoin TA: Popular crypto twitter user @100trillionUSD (aka “Plan B” on Medium) compared bitcoin’s stock-to-flow (“S2F”) ratio with that of Gold and other scarce materials. This ratio, in layman’s terms, calculates how many years of continuous production at present rate it would take to produce the same amount of material already in existence. The higher this number, in general, the higher the price of the respective commodity.



According to this model, Bitcoin, gold and silver adhere to the same pattern even though they are fundamentally different markets when considering applications, actual use, trading volume and market cap. So if some of your recent short-time trades were off, consider HODLing and averaging into a long-term position.



Ex-Paypal CFO “Fired” as Customer at Bank of America

Roelof Botha, former PayPal CFO released a tweet on Monday stating that he has been “fired as a customer”. The tweet also included a picture of the termination letter received from Bank of America.



roelof-botha-tweet



The notice states that after reviewing his banking relationship, it has decided to close the account.



It is well known that Bitcoin has more than one use case, but now more than ever it is becoming increasingly obvious that the primary one has to be the elimination of centralized banks. With negative interest rates, quantitative easing, and global debt exponentially increasing, it is only a matter of time before the world economy becomes distressed. Now, on top of all that, the banks dictating the world's monetary policy also have the power to terminate clients without any reasonable explanation. Bitcoin provides an alternative to centralized finance that is both decentralized and secure, and that is why more and more people are catching onto Bitcoin as a currency and store of value.



Google to provide checking accounts

Google is looking into banking partners to add checking accounts to their increasing financial offerings. Next to Google Pay, this will allow banks to onboard customers by forcing them to use these accounts to pay for online purchases. This seemingly “old-school” play with the code name “Cache” offers Google the same advantages as Facebook’s Libra without the dreaded anonymity, further enabling them to analyze customer behaviour and drive targeted ads sales. Checkings accounts in the US are traditionally burdened with fees (from required minimum balance to overdraft and even “maintenance” fees if not enough volume is generated) so that Google may have enough room to differentiate its services from existing offerings. On the other hand, Google is facing an antitrust investigation in regards to its advertising business, so adding another service that deepens Google’s insight into people’s day to day spending.





November 15, 2019



Key takeaways: Bitcoin falling wedge target, ETH breakout is imminent, DeFi protocol Compound raises $25M and Bakkt to offer cash-settled bitcoin futures



BTC/USD daily chart

nov-15-2019


Bitcoin price remains trapped within a tightening range of a falling wedge. Statistically, 68% of the time a falling wedge results in a breakout to the upside. On top of that, this week we can clearly observe a bullish divergence on the daily RSI. With an 8% price decrease so far this month, the overall sentiment on the market seems bearish. Yet, when the majority expect one outcome, the market tends to go the other way and technicals support that direction. The Fibonacci retracement suggests that the next target to the upside is at around $9,850 (38%), which is also where the falling wedge pattern originally started.



ETH/USD daily chart

nov-15-2019


While ether has struggled to break above the $190 resistance level against the US dollar, Bollinger Bands signal that a major price move is imminent. ETH is being squeezed within a very narrow corridor, resulting in price having fluctuated no more than 5% this month. If Ether fails to stay above the $180 support area, where the 50-day moving average currently lies, there is a high possibility of a rapid price drop. In a bullish scenario, ETH can go up to $202, according to the Fibonacci retracement level (23%). The rally could be fueled by the Ethereum Istanbul Hard Fork that is expected on December 4th.




DeFi protocol Compound raises $25M

The autonomous open-source protocol Compound Finance closes Series A with $25 million. The funding round was led by a crypto fund a16z (Andreessen Horowitz), which was one of the largest VC investments in a DeFi startup to date. Paradigm, Bain Capital Ventures, Polychain Capital and others also joined to back the project. There is a high demand in the crypto lending space and Compound offers users ethereum-based collateralized loans. The protocol supports multiple assets, which allows users to lock up assets without borrowing. Compound has already lent $1.6 billion worth of cryptocurrency.



Bakkt to offer cash-settled bitcoin futures

Bakkt’s COO Adam White shared that due to customer demand, the exchange plans to offer a cash-settled version of the product before the end of the fiscal year. CME Group is currently the only provider of cash-settled BTC futures contracts and it seems like Bakkt is ready to compete. Moreover, they have also scheduled to launch bitcoin options on futures by December 9th.





November 12, 2019



Key takeaways: Bitcoin short term trend, ETH/BTC pair bottoms out and ECB’s member to lead Banking Digital Currency Initiative



BTC/USD 1hr chart

nov-12-2019


After a 5% price drop, bitcoin is now in a consolidation phase, gaining strength for its next move. On the hourly chart we can see the formation of an ascending triangle, which is a continuation pattern.



BTC/USD 4hr chart

nov-12-2019


Despite the bearish signal of an ascending triangle, the 4 hour RSI displays a very clear bullish divergence. Keeping in mind that higher time frame patterns carry more significance,there is a possibility that price will rally in the short term.



ETH/BTC pair bottomed out?

nov-12-2019


Another notable topic of discussion is the ETH/BTC chart. It would appear that the pair has bottomed out after experiencing 10% growth in November. The price reached its lowest point of 0.016 on September 5th and since then recovered over 30%. However, the price will have to close above 0.024 sats, which has historically served as a significant support level for the pair. This level will now most likely turn into an important zone of resistance.



ECB’s member to lead Banking Digital Currency Initiative

Benoit Cœure, a European Central Bank board member is taking on the role of head of Innovation Hub, which is a strategic initiative implemented by the Bank for International Settlements (BIS). BIS has long been exploring fintech and digital currencies. Now BIS has established the Innovation Hub with the purpose of researching the latest and most advanced technological innovations in fintech that will “benefit central bank operations” and improve the overall functionality of the current global financial system.





November 8, 2019



Key takeaways: Bitcoin bullish pennant, Stellar burns $4.7 worth of tokens, 2017 bull run manipulated by one whale theory



BTC/USD daily chart

nov-8-2019


The 100 and 200-day moving averages are converging, providing support and resistance and narrowing the range. BTC is currently trapped in between $9,000 and $9,500 price levels. The chart pattern still remains in a bullish pennant and is getting closer to the inevitable massive move. Exponential moving average is turning back to the upside as well.



Stellar burns tokens

On November 4th, Stellar significantly reduced the number of tokens, burning $4.7 worth of XLM. The foundation explains over 50 billion tokens burned as a measure to become more efficient. After cutting tokens in circulation (mostly from giveaway programs) there are currently 20 billion XLM on the market. This resulted in a 30% rollacoaster price move, as traders are speculating on the news.



XLM/USD daily chart

nov-8-2019



One BTC whale allegedly caused 2017 surge

According to a study conducted by two American professors, John Griffin (University of Texas) and Amin Shams (Ohio State University), the 2017 bull run was manipulated by a single bitcoin whale. They claim that in order to trigger such a massive price surge Tether was used for the transaction. Tether obviously rejects this claim, because it also supports the controversy that USDT is created without dollars to back it and subsequently used to buy BTC and stimulate the price growth. “Simulations show that these patterns are highly unlikely to be due to chance. This one large player or entity either exhibited clairvoyant market timing or exerted an extremely large price impact on Bitcoin that is not observed in aggregate flows from other smaller traders.” wrote the professors. The crypto community is not convinced by this study and critics are tormenting it for being fundamentally flawed.



Bakkt volume is taking off

After having a disappointingly low volume for a while, the significant bitcoin price growth also increased the interest from institutional investors. Since then Bakkt is showing good volume, despite the fact that BTC is moving sideways.





November 5, 2019



Key takeaways: Bitcoin massive move coming soon, bullish and bearish signals, China’s blockchain race



BTC/USD 4hr chart

nov-5-2019


On the four hour time frame, BTC is in the process of forming a horizontal triangle in a range between $9,000-$10,000. We can also observe a significant decrease in volume, which signals that bitcoin is gearing up for its next major move. If this turns into a continuation move, then it is probable to see a 30-40% increase in price.



BTC CME Futures daily chart

nov-5-2019

Although bitcoin is currently showing a bullish bias, for now it still lacks the momentum for a massive breakout. BTC still heavily relies on the 200-day moving average for support. A more concerning chart is apparent on the CME Futures, where a gap between $8,900 and $9,000 has yet to be filled. In order to fill this gap, bitcoin’s price would need to go down roughly 6% from its current price. But it doesn’t stop there: there are talks about the Chinese issuing their very own digital currency using blockchain to streamline government services.



China’s blockchain race

After last month’s announcement from Chinese President Xi Jinping, as well as Chinese Congress passing of a new law on crypto technology, it seems like the country entered a race for blockchain technology superiority. They are planning further modifications and adjustments of regulations, in order to encourage technological innovations. This will require significant time, monetary investment, and infrastructure change in order to be successful. A key takeaway that is evidently clear is that other world powers must catch up in developing and implementing blockchain if they wish to compete in the new technological landscape.





November 1, 2019



Key takeaways: Bitcoin forms a bullish pattern, Coinbase causes a price flash crash and XRP technical analysis



BTC/USD daily chart

nov-1-2019


Breaking above the 200-day moving average has saved bitcoin price from entering a bear market. Price is now re-testing the support level at $9,000. The massive break to the upside that was followed by a 12% correction resulted in a bullish flag pattern on the daily chart. If this pattern plays out, then the next target would be at around $11,900.



Bitcoin price flash crash

Coinbase Pro shutdown yesterday causing a flash crash across multiple exchanges, mostly affecting Deribit, where the price went all the way down to $7,700 for roughly three minutes until returning to previous levels in the $9,000 range. Another serious case was recorded on BTSE exchange, where the price spiked to $15, 000 and then dumped to $6,500 in just minutes. The reason for such abnormal price behavior is largely due to algorithmic trading bots, which add directional liquidity to price action and drive prices to extreme levels in the blink of an eye. Furthermore, the calculation of exchange index prices is derived from the underlying prices being reporting by other major exchanges. This is why the outage of Coinbase created such a rollercoaster in price movement. As for the consequences, Deribit has reimbursed over $1.3 million in total to those users who were affected by these events.





XRP/USD daily chart

nov-1-2019


Following the large move in bitcoin price, XRP also experienced a steep rise that was followed by an 8% correction. As a result, the coin is currently trading around the $0.30 price level.
Except for a rapid 14% dip on October 23rd, the price has risen gradually over an extended ascending channel. The 50-day moving average is very close to crossing the 100-day moving average, which would be a bullish signal.





October 29, 2019



Key takeaways: BTC price correction before the next move, CME futures “filling the gap” and China’s stand on crypto



BTC/USD daily chart

oct-29-2019


Last week’s bullish divergence on the daily RSI resulted in almost a 40% spike. Bitcoin breaking above the 200 day moving average with significant volume then closing above the 200 day is a very bullish sign. Bitcoin has already retraced 10%, which was not unexpected after its parabolic rise over the weekend. It would be reasonable to assume that BTC might retest the 200-day MA level at around $9000.



BTC/USD CME Futures daily chart

oct-29-2019


During its rapid move to the upside, bitcoin created a gap on the daily CME futures chart. This gap is now expected to get filled and points to a target of $8900.



China’s stand on crypto

The massive pump experienced is mainly tied to the Chinese Government jumping on the crypto bandwagon. On the 24th of October, Chinese President Xi Jinping encouraged to take advantage of blockchain technology as it can benefit the country's development. He also called for increasing investments and financing businesses in the field. Two days after this announcement, Chinese Congress passed a new law on crypto technology that supports its research and development. China is now openly pushing forward to become a leader in the blockchain space.


Market Cap BTC Dominance

oct-29-2019


Although almost all crypto projects saw a rise in evaluations, bitcoin dominance rose significantly higher than most other currencies. Bitcoin dominance is currently at 70% as altcoins are struggling to get the same buzz.


Bakkt’s growth in volume

oct-29-2019


The bitcoin price increase also contributed to increased activity on Bakkt contracts, resulting in the platform’s highest daily volume so far - 524 BTC.





October 25, 2019



Key takeaways: Bitcoin enters bear market, Wall Street price manipulation, BTC reaches 18 million milestone and shopping on Amazon with crypto is now possible



BTC/USD weekly chart

oct-25-2019


Bitcoin now enters a bear market, as we see a candle dipping below the EMA ribbon on a weekly chart. Historically this hasn’t happened before and if the weekly candle closes below the EMA the bearish scenario becomes more likely to play out. The ribbon is usually able to provide a strong support when price breaks above it for about 1.5-2 years. This time it didn’t hold 5 months and now there are several bearish indicators:


BTC/USD daily chart

oct-25-2019

There is a Death Cross of 50 and 200-day moving averages on a daily chart. Also, we can see a completed Head and Shoulders formation which is a bearish pattern with a $6900 target.


BTC/USD weekly chart

oct-25-2019


However, the falling wedge theory for now remains valid if the price stays within the wedge pattern. If the support line is able to hold, the price might bounce back and reverse into a bullish pattern. To further support any bulls’ spirit, there is a bullish divergence on daily RSI (see chart: BTC/USD daily chart).


BTC price manipulation

The rapid 5% price drop happened within 5 minutes as about 400BTC were sold on Bitstamp. Another 3 major sells with a total worth of around 265 BTC followed minutes after that. The crypto community is now under a strong impression that the price was manipulated by Wall Street and the introduction of futures products made it possible. “The launch of bitcoin futures would have the impact of popping the bitcoin bubble. And it worked.” said the former CFTC, Christopher Giancarlo.



18 million BTC mined

Bitcoin reaches a big milestone, there are now over 18 million BTC mined and in circulation. Miners’ reward halvings happen about every 4 years (or 210,000 blocks) and the remaining 3 million will take progressively longer to mine. The hard-coded supply cap of 21 million bitcoin is expected to be fully mined in over 100 years.



Shop on Amazon with crypto

No, not directly. But there is now a browser extension available called Moon that allows to shop on Amazon with cryptocurrency. The solution offers to pay via Lightning Network or with a Coinbase account. For now it is only available on Amazon, but they do plan to expand to eBay, AliExpress, Target etc for those who want to spend their bitcoin on online shopping.





October 22, 2019



Key takeaways: Bitcoin $11700 target, XRP 20% growth, despite negative quarterly report and ETH falling wedge short and long-term predictions



BTC/USD daily chart

oct-22-2019


BTC/USD daily chart shows us two almost identical falling wedges. The one we are in right now is a smaller version of what we saw in 2018. Following this pattern, there is a high possibility that the price will keep moving sideways until mid-November, before breaking out to the upside to reach $11700 target. This also aligns with the Golden Pocket on a Fibonacci Retracement level between 61.8 and 65%.



BTC/USD CME Futures daily chart

oct-22-2019


Moreover, there is an infilled gap on a CME daily chart in between $11700 and $11800 price levels. Historically, those gaps are almost always filled eventually.



XRP/USD daily chart

oct-22-2019


In the meantime, XRP is one of the best performing coins this month. The coin shows a gradual 20% growth since October 1st, unlike the rest of the top 10 cryptocurrencies. However, if we consider a recently published market report for Q3, fundamentally Ripple is not doing so well. The report mentions a significant decrease in sales, as well as overall market cap.



ETH/USD daily chart

oct-22-2019


As for Ether, the coin clearly draws a falling wedge pattern on a daily chart. It tested both support and resistance lines four times already for the past 4 months. It now struggles to break above daily EMA ribbon and most likely will test the support level again at around $140 price point. However, if the pattern plays out well, then the long-term target might be up at 320$.





October 18, 2019



Key takeaways: Bitcoin bear flag target, first government in the world to accept crypto for tax payments and blockchain-based digital dollar proposal



BTC/USD weekly chart

oct-18-2019



After experiencing a 344% bull run since the lows of December 2018, bitcoin has now seen a 43% correction since its peak on June 24. It is currently trapped between the 20 and 100-day moving average on a weekly chart. The 100-day moving average is standing strong as support is preventing the price from falling further over the past four weeks. If BTC breaks below this critical level, we could see a massive dump all the way to the $6,700 support level. This is a price point where we would see significant volume kick in.



BTC/USD daily chart

oct-18-2019



On a short timeframe (4hr) bitcoin has bounced upwards in a trending channel, which could conversely be seen as a bear flag. If the price breaks below $7,800, it would validate the bear flag formation and align targets with the weekly VPVR level and 100-day MA.



First government to accept crypto for tax payments

Bermuda, a British island territory in the North Atlantic Ocean with the 6th highest GDP per capita in 2019 recently got major attention from the crypto community. The government of Bermuda is now the first in the world to accept cryptocurrency payments for tax duties. They are accepting payments via USD Coin (USDC) a stablecoin backed by U.S.dollar.



Blockchain-based digital dollar from the government?

According to the Wall Street Journal, two former CFTC (Commodity Futures Trading Commission) heads proposed an initiative for a government sanctioned blockchain based digital dollar. The goal is to adapt the current monetary system to the new digital era and use US dollar backed stable coin(s) to make domestic and international transactions.



G7 concerns about stablecoins and Libra

The G7 taskforce that includes the USA, Germany, Canada, Japan, France, United Kingdom and Italy released a report that addresses concerns and risks related to stablecoins, and Libra specifically. They warn to hold on with any developments of a global stablecoin until all the potential threats and risks associated with its implementation to the global financial system are evaluated properly.





October 15, 2019



Key takeaways: Bitcoin below 200-day moving average, BTC/USD longs dominance, Amara’s law and the impact of blockchain technology



BTC/USD daily chart

oct-15-2019



Over the past two weeks bitcoin did not make a decisive movement to the upside or downside and has consistently traded within a 5% range. It is also still unable to break above the 200-day moving average. While the BTC chart in isolation does not give us anything exciting to talk about, let's have a look at the BTC/USD long chart.



BTC/USD longs daily chart

oct-15-2019



Despite the recent sell off, BTC/USD longs have consistently made higher lows since May and buyers still dominate on a longer time frame. Yet for now, there is still clear indecisiveness on the market and it has resulted in stagnation.

oct-15-2019

After the latest correction, there has been an unusual spike in the number of bitcoin addresses that hold over 1000BTC. One view, a more optimistic one for bitcoin, is that it indicates that institutional investors and whales are taking advantage of Bitcoin trading at a discount price. The second takeaway is that it could mean that large-scale crypto holders are capitulating and selling altcoins into BTC in anticipation of another leg down in price.



Amara’s Law and the Impact of Technology

oct-15-2019

Amara’s Law and the Impact of Technology diagram visualises how humans estimate the future when it comes to technological progress and its impact. We tend to overestimate the short term utility of these technologies, simply due to exorbitant enthusiasm. Yet, in the long run people tend to underestimate the pragmatic impact of these disruptive technologies on their lives. A great historical example of this is the Internet, and this draws many parallels to the public perception of blockchain technology. When one argues that they are unable to purchase things with bitcoin and that none of the stores they shop at accept BTC as a currency, this is clearly the wrong way to go about innovation. In the short term there is no place for mass adoption and it is overestimated how fast blockchain will be integrated in our lives. This was also the psychology that drove altcoin hype and ICO bubble in late 2017. It is well known that these projects did not bring about any significant real life solutions. However, real, practical technology like Bitcoin offers tremendous value to society and its long term impact is currently being underestimated by the general public. While it is difficult to estimate how much cryptocurrency will change the future of financial technology, bitcoin still appears to be the closest thing to “perfect money” that we have today.





October 8, 2019



Key takeaways: Bitcoin momentum shift, the best-performing asset in 2019, and SEC acknowledgement that BTC is not a security



BTC/USD daily chart

oct-8-2019



Bitcoin price is trapped in the sideways channel and still remains under 200-day MA, which makes the situation bearish for now. BTC has a significant volume within this price range and VPVR indicates that the next move would be either a drastic 25% to the upside or 35% to the downside.



Looking at MACD indicator on a daily timeframe, the downside pressure was quite strong recently and is now almost completely gone. It signals that bitcoin is potentially very close to a momentum shift, to the upside.



Also, Bloomberg’s global bitcoin strength indicator shows a buy signal, for the first time since November 2018.



oct-8-2019



Source



Bitcoin outperformed gold and stocks in 2019

Bitcoin is the best-performing asset so far this year, despite the recent price downturn. It doubled in value against the US dollar, while the Gold price increased by 17% and S&P 500 index by 21%. Even comparing to U.S. tech stocks that reached 31% return, BTC was still a better asset to invest in 2019.



Bakkt’s first block trade

Despite the slow start, crypto investment fund Galaxy digital and OTC cryptofinance company XBTO just made the first block trade bitcoin futures contract with Bakkt. (Block trade is large transaction negotiated off the open market. It takes place over the counter to avoid affecting the price too much). The exchange didn’t reveal the actual amount of the trade. Despite the fact that Bakkt had a very low trading volume it didn’t scare off big players to come in.



SEC acknowledged that BTC is not a security

According to the SEC's Division of Investment Management letter, addressed to Cipher Technologies Bitcoin Fund the commission staff disagree with the conclusion that bitcoin is a security. The letter started: “Among other things, we do not believe that current purchasers of bitcoin are relying on the essential managerial and entrepreneurial efforts of others to produce a profit.” This was the first public confirmation that SEC doesn’t consider Bitcoin as a security.





October 4, 2019



Key takeaways: Bitcoin history repeats itself, Falling Wedge theory, BTC’s stock-to-flow ratio by Bayern LB, and Binance’s new AML partnership



BTC/USD daily and weekly chart

oct-4-2019



There are undeniable similarities between current and historical bitcoin price action. A massive bull run, followed by a consolidation phase, where the price bounces between support and resistance and forms a descending triangle. When the price reaches the tip of the triangle it breaks down and moves sideways for some time, before going on the next run up again. This seems like a possible scenario right now, as there is almost no volatility for the past 10 days, BTC is gaining strength for the next potential bull run.



BTC/USD daily and weekly chart

oct-4-2019



There is also another theory to consider, that in fact it is a falling wedge forming right now, the one that was overlooked in the previous bear market. According to this pattern, the price should get back to where the falling wedge begins. After a final shakedown, we may see bitcoin heading back to its $14000 target in the long term.



Bayern LB introducing bitcoin as hard money

The German bank Bayern LB published a paper titled “Is Bitcoin outshining gold?” concluding that according to the stock-to-flow approach, bitcoin is a hard asset. According to the Bayern LB, there is an “unusually strong correlation” between the market value of bitcoin and the ratio of BTC (“stock”) and new supply (“flow”) especially in the context of next year’s halving.



oct-4-2019



Binance integrates new AML platform

Throwback to early August, the G20 Summit in Japan committed to implement the guidelines by the Financial Action Task Force (FATF). These guidelines seem to have first impacts on the biggest exchange in the crypto space. Following the FATF requirements, crypto exchanges need to establish a system to identify the identity of both crypto sender and recipient. Binance’s latest AML partnership with Coinfirm is in line with these regulations. This announcement follows the latest news from another blockchain investigation firm Chainalysis increasing their services by multiple new coins





October 1, 2019



Key takeaways: Bitcoin price bounces off important support level, ETH outperforms BTC in September and XRP recovers after massive dump

BTC/USD daily and weekly chart

BTC/USD daily chart



With bitcoin price at $8400, the question arises - is it a bounce or a breather before breaking a major support level?

On a daily chart, the VPVR indicates that there is a significant volume within the price range between the 200-day Moving Average and weekly EMA ribbon. BTC tested the ribbon twice in the past week and once again proved to be significant support, as it was able to hold the price above.



As mentioned in our previous issue, bitcoin has never broken above the weekly EMA ribbon without a massive and continuous bull run and this pattern remains valid today. However, it does not mean that bitcoin price is safe from falling further. If it breaks below $7700, BTC is expected to show a significant drop, at least to the next support at $7200.



In a bullish turn of events, if bitcoin can break and close above the 200-day MA at $8400, we can assume the price to rapidly recover after it’s recent fall.



Ether outperforms bitcoin in September

September turned out to be tough for bitcoin, with the price moving sideways for the majority of the month, before falling more than 20%. Other coins like Bitcoin Cash and BNB also took a hit. ETH was one of the few standing strong and after a roller-coaster ride is still up 2% by the end of the month.

Coins performance



Source

Ripple recovery

Ripple (XRP) gains 25% back from a local low and is now facing EMA ribbon on a daily to push through. At the moment of writing, XRP hovers around the $0.255 level against the US Dollar. Bulls would need to gain further strength to break above the $0.2620 resistance area and in such case, the price will test the main resistance at $0.2650.

XRP/USD daily chart

XRP/USD daily chart