Bitcoin and the Majors Take a Dive as the Bears Fight Back

Cryptomania

Bitcoin tumbled by 5.99% on Wednesday. Following on from a 1.33% fall on Tuesday, Bitcoin ended the day at $10,147.

A particularly bearish morning saw Bitcoin slide from a start of a day intraday high $10,825 to a mid-day intraday low $9,824.

Falling shy of the first major resistance level at $10,995.4, Bitcoin slid through the major support levels on the day.

In spite of the sell-off, however, Bitcoin steered clear of the 38.2% FIB of $9,734, supporting a partial recovery.

Bitcoin managed to move back through the third major support level at $9,971.7 to $10,000 levels late on.

Closing out the day at $10,000 levels was the only positive as the broader market went into meltdown mode.

Wednesday’s loss took a large bite out of Bitcoin’s August gains. For the current month, Bitcoin was up by just 0.58% and was the only major in positive territory in August.

Bitcoin’s hold above the 38.2% FIB of $9,734 reaffirmed the bullish trend formed at mid-December’s swing lo $3,215.2

Elsewhere

Across the top 10 cryptos, it was red across the crypto-board.

Monero’s XRM and EOS were the worst performers on the day, with losses of 6.11% and 4.71% respectively.

Bitcoin Cash SV (-4.44%), Ethereum (-4.68%), BNB (-4.2%), and Bitcoin Cash ABC (-3.64%) also saw particularly heavy losses.

On the day, Litecoin (-2.56%), Stellar’s Lumen (-2.78%) and Ripple’s XRP (-3.14%) suffered the lightest of losses in the meltdown.

Bitcoin’s strong heavy loss on the day led to a fall in dominance back to sub-69% levels.

The broad-based crypto meltdown led the total market cap from $279bn levels to a day low $258.49bn before support kicked in. At the time of writing, the total crypto market cap stood at $263.63bn.

24-hr volumes climbed from $48bn levels at the start of the day to $62bn levels as investors responded to the sell-off.

This Morning

At the time of writing, Bitcoin was down by 0.8% to $10,066.  Within the first hour, Bitcoin rose to an early high $10,163 before pulling back to an early morning low $10,056.

Bitcoin left the major support and resistance levels untested in the 1st hour.

Elsewhere, it was a mixed bag for the top 10. Tron’s TRX led the was, rising by 1.19%. EOS. (+0.62%). Binance Coin (+0.36%), and Ripple’s XRP (+0.21%) were also in the green early on.

It was red for the rest of the majors, however, with Stellar’s Lumen and Bitcoin Cash ABC seeing the heaviest losses. At the time of writing, the two were down by 2.8% and by 1.11% respectively.

BTC/USD 22/08/19 Daily Chart

For the Bitcoin day ahead

Bitcoin would need to avoid a fall back through to sub-$10,000 levels to support a move back into the green. A return to $10,265 levels would bring the first major resistance level at $10,706.67 into play.

Bitcoin would need the support of the broader market, however, to break out from $10,100 levels.

Barring a broad-based crypto rebound, however, Bitcoin will likely come up short of $10,500 levels on the day.

Failure to hold onto $10,000 levels could see Bitcoin test support at the 38.2% FIB of $9,734 before any recovery.

Barring another crypto meltdown, the first major support level at $9,705.67 should limit any downside on the day.

Bitcoin Dominates on a Mixed Day for the Majors on Wednesday

Bitcoin, Ethereum, Litecoin Digital cryptocurrencys on a notebook

Bitcoin rallied by 4.6% on Wednesday. Reversing a 3.01% slide from Tuesday, Bitcoin ended the day at $11,999.

A particularly bullish morning saw Bitcoin rally from a start of a day intraday low $11,385 to an early afternoon intraday high $12,153.

Steering clear of the first major support level at $11,039, Bitcoin broke through the first major resistance level at $12,115.

A broad-based late afternoon crypto sell-off saw Bitcoin slide back to 11,500 levels before finding support.

Continuing to steer clear of the major support levels, Bitcoin bounced back to $12,000 levels late on.

At the end of the day, however, Bitcoin’s failed to hold onto $12,000 levels at the day’s end. The last time Bitcoin wrapped up the day at $12,000 was on 10th July.

A bullish start to the month left the extended bullish trend intact. Bitcoin’s hold above the 23.6% FIB of $11,275 reaffirmed the bullish trend formed at mid-December’s swing lo $3,215.2

Elsewhere

Across the top 10 cryptos, it was a mixed bag for the majors.

Bucking the trend on the day were Litecoin, Bitcoin Cash SV, and Stellar’s Lumen. Litecoin led the way down, falling by 2.54%. Bitcoin Cash SV and Stellar’s Lumen saw more modest losses of 0.69%, and by 0.18% respectively.

Leading the way on the day was Binance Coin, which surged by 7.42%. Bitcoin Cash ABC and EOS also managed to find support, rising by 1.40% and by 0.99% respectively.

For the rest of the pack, the gains were minor. Ripple’s XRP rose by 0.13%, while Ethereum ended the day flat.

The upward bias across the majors saw the total crypto market cap rise from sub-$300bn levels to $309.8bn, at the time of writing.

Bitcoin’s gains on Wednesday also led to a rise in Bitcoin’s dominance to 68.9%.

While the news wires were on the quieter side on the day, Litecoin’s struggles came off the back of this week’s halving event. Bitcoin’s next up on the halving front, with the halving date forecasted to be on 17th May 2020.

If Litecoin’s 2019 rally is anything to go by, Bitcoin’s likely to find plenty of support, assuming there is no negative regulatory news.

Year-to-date, Litecoin had rallied by 390% to a late June’s current year high $146 and was up by 212% to last Sunday. Should Bitcoin see similar interest, it’s a projected return to $19,000 levels…

The one caveat, however, is that Litecoin and the broader market have been in recovery mode through the current year. Year-to-date, Bitcoin was up by 182% to last Sunday. That projects a less impressive pre-halving return to $15,000 levels, all other considerations aside.

This Morning

At the time of writing, Bitcoin was down by 0.59% to $11,928. A mixed start to the day saw Bitcoin rise to an early morning high $12,050 before falling to a low $11,898.

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, Bitcoin Cash SV bucked the trend early on with a 0.54% rise. It was red for the rest of the majors, however, with Binance Coin giving up some of Wednesday’s gains, falling by 1.05%.

BTC/USD 08/08/19 Daily Chart

 

For the Bitcoin day ahead

Holding above $11,845 levels would support a move back through to the morning high $12,050. Bitcoin would need the support of the broader market, however, to take a run at the first major resistance level at $12,306.33.

Barring a broad-based crypto rally, Wednesday’s high $12,153 would likely limit any upside on the day.

Failure steer clear of $11,845 levels could see Bitcoin slide deeper into the red. A fall through to $11,700 levels would bring the first major support level at $11,538.33 into play.

Barring a crypto meltdown, Bitcoin should steer clear of the 23.6% FIB of $11,275.

The Majors Find Support. Was it from the FED?

Bitcoin, Ethereum, Litecoin Digital cryptocurrencys on a notebook

Bitcoin rallied by 2.33% on Wednesday. Reversing most of a 2.75% slide from Tuesday, Bitcoin ended the day at $9,305.9.

A bullish start to the day saw Bitcoin rise from a morning low $9,062.0 to an early morning high $9,235.1 before easing back.

Bitcoin left the major support and resistance levels untested through the early part of the day.

Following a range-bound afternoon, Bitcoin rallied from sub-$9,100 levels to a late intraday high $9,340.0.

The rally saw Bitcoin come up against the first major resistance level at $9,332.87 before easing back.

While it was a 7th day in the green out of the last 8, Bitcoin came up short of Monday’s swing hi $9,4900.

Elsewhere

Across the top 10 cryptos, it was a sea of green for the majors.

Leading the way on the day was Binance Coin, which rose by 2.58%. Ripple’s XRP also kept pace with Bitcoin, gaining 2.09% on the day.

Trailing the majors were Stellar’s Lumen and Bitcoin Cash ABC, with gains of just 0.23% and 0.21% respectively.

For a number of the majors, while steadying from Tuesday’s sell-off, a failure to recoup the losses could test appetite ahead of the weekend.

The moves on the day came in spite of a lack of influence from the crypto news wires.

Perhaps of interest was the timing of Bitcoin’s upward moves through the latter part of the day on Wednesday. Bitcoin’s intraday high $9,340.0 came following the FED’s dovish press conference and projections of 2 possible rate cuts over the remainder of the year.

How Bitcoin and the majors respond to progress on the U.S – China trade talks would provide further evidence of a relationship between FED policy and the crypto market.

One caveat, however, is that progress on trade talks would support risk appetite and there are few asset classes riskier than the cryptos…

This Morning

At the time of writing, Bitcoin was down by 0.16% to $9,291.2. A bearish start to the day saw Bitcoin fall from a morning high $9,330.7 to a low $9,291.1.

Bitcoin left the major support and resistance levels untested within the 1st hour.

Elsewhere, Bitcoin Cash ABC and Bitcoin Cash SV bucked the trend early, with gains of 0.25% and 0.28% respectively.

While Binance Coin was flat at the time of writing, Ripple’s XRP and Stellar’s Lumen led the way down early on. The pair were down by 0.49% and by 0.40% respectively.

BTC/USD 20/06/19 Daily Chart

For the day ahead

A move back through to $9,300 levels would support a run at the first major resistance level at $9,409.93.

Bitcoin would need support from the broader market, however, to break out from Wednesday’s high $9,340.

In the event of a broad-based crypto rally, Bitcoin could target the current year high $9,490 before any pullback. We would expect Bitcoin to leave $9,500 levels and the second major resistance level at $9,513.97 untested on the day.

Failure to move back through to $9,300 levels could see Bitcoin slide deeper into the red.  A fall through to $9,250 levels would bring the first major support level at $9,131.93 into play.

Barring a crypto meltdown, Bitcoin should steer clear of sub-$9,100 levels on the day.

The Majors Rebound, While Litecoin Takes a Break

Bitcoin, Ethereum, Litecoin Digital cryptocurrencys on a notebook

Bitcoin gained 3.4% on Wednesday. Reversing a 1.41% fall from Tuesday, Bitcoin ended the day at $8,174.00.

A relatively choppy saw Bitcoin fall to an early morning intraday low $7,821.0 before finding support.

Steering well clear of the first major support level at $7,728.0, Bitcoin rallied to an early afternoon intraday high $8,250.0.

The early afternoon rally saw Bitcoin break through the first major resistance level at $8,066.

Bitcoin’s second major resistance level at $8,226.50 limited the upside on the day. Easing back through the afternoon, Bitcoin fell to sub-$8,100 levels before finding support.

For the Bitcoin bulls, it was just a 2nd hold onto $8,000 levels since 3rd June.

Elsewhere,

Across the top 10 cryptos, it was a mixed day for the majors.

Bucking the trend on the day, but for the wrong reasons, was Litecoin. A late rally left Litecon flat for the day. Profit taking weighed after striking a new swing hi $144.34 in the early afternoon. Litecoin had seen gains of 13% and 5.1% on Monday and Tuesday.

For the rest of the 10, it was a sea of green. Leading the way on the day was Binance Coin, which rallied by 9.5%. Ethereum (+7.24%) and Stellar’s Lumen (+5.37%) also saw solid gains on the day.

A lackluster week for Stellar’s Lumen and Cardano ADA’s (9.88%) rally on Wednesday saw the pair trade place for the number 10 spot.

The Wednesday rally saw the total crypto market cap rise from $254bn levels to $261bn levels on the day. 24-hour trading volumes were also up, rising from $59bn levels to $66bn levels.

This Morning,

At the time of writing, Bitcoin was down by 0.48% $8,134.5. Bitcoin rose to an early morning high $8,200 before sliding to a morning low $8,111.0.

In spite of the early moves, Bitcoin left the major support and resistance levels untested early on.

Elsewhere, joining Bitcoin in the red were Litecoin (-0.87%), Stellar’s Lumen (-0.45%), Ethereum (-0.89%), Binance Coin (-0.63%) and Cardano’s ADA (-1.74%).

Finding support was Bitcoin Cash ABC (+1.78%), with EOS (+1.4%), and Ripple’s XRP (+0.85%) also in the green.

BTC/USD 13/06/19 Daily Chart

For the day ahead

Bitcoin would need to hold onto $8,100 levels through the morning to support a bounce back later in the day.

A move back through to $8,200 levels would bring Wednesday’s high $8,250 into play before any pullback.

Support from the broader market would be needed, however, for Bitcoin to break through to $8,300 levels.

Barring a broad-based crypto rally, Bitcoin would likely leave the first major resistance level at $8,342.33 untested.

Failure to hold onto $8,100 levels could see Bitcoin slide deeper into the red. A fall through the morning low $8,111.0 would bring sub-$8,000 levels into play before any recovery.

A broad-based crypto sell-off would bring the first major support level at $7,913.33 into play before any recovery.

Barring a crypto meltdown, however, Bitcoin would likely steer clear of sub-$7,800 levels for a 2nd consecutive day.

Do the Crypto Bulls Have the Staying Power? We’ve Been Here Before…

Bitcoin symbol in blockchain technology and cryptocurrency concept. Abstract background 3d illustration.

Bitcoin surged by 17.3% on Tuesday. Following a 0.7% rise on Monday, Bitcoin ended the day at $4,922.2.

Bullish from the start of the day, Bitcoin rallied from an intraday low $4,187.4 to a mid-morning intraday high $5,106.9.

Steering clear of the day’s major support levels, Bitcoin broke through the day’s major resistance levels and 23.6% FIB of $4,816. It was Bitcoin’s first visit to $5,000 levels since 20th November.

Key in the day was Bitcoin’s break through the all-important $4,500 level that was needed to draw in sidelined investors.

Elsewhere

Across the top 10 cryptos, Bitcoin Cash ABC stole the show on Tuesday, surging by a whopping 45.7%. The breakout led to a near-term bullish trend formation after hitting an intraday high $248.

Litecoin also found strong support, rallying by 28.4% on the day. Trailing the trailblazers, but not too far off, were EOS (19.5%), Cardano’s ADA (18.6%) and Ethereum (16.9%).

While bullish through the day, an early morning jump delivered the killing blow to the bears.

The total crypto market cap jumped from $159bn to a high $176.97bn on Tuesday before easing back.

Perhaps more impressively was the jump in volumes as investors jumped back onto the crypto bandwagon.

The 24-hour trading volumes had already risen to $48.5bn in the early hours of Tuesday. By late morning on Wednesday, volumes hit a day high $89.5bn…

What drove the rally across the majors on the day?

There were no major news events to drive Bitcoin back through to $5,000 levels. A positive end to the 1st quarter and some solid gains for the likes of Litecoin and Binance will have drawn investor attention.

April is a bullish month across the more traditional asset classes. The cryptomarket’s staying power will have impressed some of the doubters. As adoption continues to rise, albeit at a snail’s pace, and the SEC looks set to approve at least one of the Bitcoin ETFs, if not next month, sooner rather than later, there is optimism in the broader market.

It won’t be the first time that we’ve seen the bounce, however. Investors will be mindful of what happened in the last rally and any pullback could accelerate Bitcoin’s return to sub-$4,000 levels.

Get Into Cryptocurrency Trading Today

This Morning

At the time of writing, Bitcoin was up by 1.6% to $5,001.1. Another bullish start to the day saw Bitcoin rally to a morning high $5,090.1 before easing back.

Coming up short of the first major resistance level at $5,290.2, Bitcoin slid back to a morning low $4,909.0 before moving back into positive territory.

The day’s major support levels were also left untested early on.

Across the top 10, Bitcoin Cash ABC continued to lead the way, up by 6.09% at the time of writing, closely followed by Litecoin, which was up by 5.5%.

BTC/USD 03/04/19 Daily Chart

For the day ahead

A hold above $4,900 levels through the day would continue to support a run at the first major resistance level at $5,290.2.

Support from the broader market later in the day could deliver a second breakout to $5,300 levels before any pullback.

Barring a broad-based crypto rally, however, we would expect Bitcoin to struggle to break through to $5,100 levels on the day.

Following some choppy moves last year, some profit taking could cap the upside on the day, should the broader market not experience another jump.

Failure to hold above $4,900 could see selling pressure build through the day. A fall through $4,750 levels would bring the first major support level at $4,370.7 into play before any recovery.

Trading volumes will need to be tracked through the day. Larger price swings are to be expected should trading volumes begin to ease back towards sub-$50bn levels.

We could be seeing $6,000 levels by the weekend should Bitcoin avoid a pullback mid-week…

G20 to Regulate Cryptocurrency Markets

G20 to Regulate Cryptocurrency Markets

The G20, an international forum for governments and central banks, has recently signed a declaration to regulate cryptocurrencies. The declaration was signed in Buenos Aires and covers many topics involving tax evasion, anti-money laundering, anti-terrorism, and public policy.

In Section 25, the declaration explicitly mentions cryptocurrencies:

“We will step up efforts to ensure that the potential benefits of technology in the financial sector can be realized while risks are mitigated. We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards and we will consider other responses as needed.”

The declaration also notes the benefits of an “open and resilient financial system” that the cryptocurrency industry offers. They are also wary of to over-regulate which may stump the growth of innovation. Other than a simple acknowledgment to regulate crypto assets, no details have been disclosed.

The G20 is a powerful forum that combines the leaders across 19 countries and the EU with a focus on “economic, financial and political cooperation,” according to their website.

What Does This Mean for the Future of Crypto?

There is no need for panic. Fortunately, many governments and large forums, like the G20, have not banned the use of cryptocurrencies and instead are looking to work with it. They are conscious of its positive impacts and are only looking to protect investors, while not halting the growth of the technology. While many cryptocurrency enthusiasts are strongly opposed to regulation, the reality is that it is required to bring in institutional investors and reach mainstream adoption.

Many institutional investors, especially hedge fund managers are waiting for clear regulatory guidelines before investing. For example, hedge funds that trade equities in the US are regulated by the SEC. Currently, Bitcoin is not identified as a security, which means that by law, hedge funds cannot invest in Bitcoin directly or recommend it to their clients.

Instead, institutional investors are waiting for an ETF, which is a security and in turn, allows them to speculate on the cryptocurrency markets. For an ETF to be passed by the SEC, the underlying assets need to have clear legal guidelines.

In a discussion about a cryptocurrency ETF, SEC Chairman Jay Clayton has mentioned, “We care that the assets underlying that ETF has good custody and that they’re not going to disappear.” This was said after acknowledging, “We’ve seen some thefts around digital assets that make you scratch your head.”

Moving forward, exchanges will need to work more closely with regulatory bodies to provide proper custodial, trading, and accounting services, as well as a moderate level of insurance in the event funds, are lost or compromised. With more legal and operational infrastructure, there is no reason an ETF will not pass soon.

Is Institutional Infrastructure Being Built?

Yes. According to CNBC, Fidelity is working on custody and trade execution solutions to bring operational ease for their clients.

Fidelity’s “goal is to make digitally native assets, such as bitcoin, more accessible to investors,” Chairman and CEO Abigail Johnson said. “We expect to continue investing and experimenting, over the long-term, with ways to make this emerging asset class easier for our clients to understand and use.”

Coinbase has also launched Coinbase Custody which is another effort to simplify the process for storing and securing digital assets. Both regulators and service providers are working towards a more defined and practical future for digital assets. There is lots of activity with hundreds of millions of dollars being invested in this new industry.

Still, don’t be too relaxed. It is our responsibility to avoid over-regulation which can burden innovation and continue to promote the use of this global technology. We witnessed this first hand with the NY Bitlicense, which added large fees and cumbersome paperwork to the process for cryptocurrency companies to operate in the state of New York. As a result, many companies choose to operate outside of NY.

As long as the community stays vocal and involved, the future will be bright. We are excited for what is to come.

Don’t Mention the B Words – Cryptomarket Turmoil Grabs the Headlines

Bitcoin Crash

As the cryptomarket progressed through much of this year, a jump in volatility and a wave of bearish sentiment, following December’s broad-based cryptomarket rally, led to plenty of debate on whether Bitcoin and the broader market gains to record highs back in December was just a bubble ready burst.

Certainly, when comparing to the dot.com era and bubbles of old, more than 1,000 gains in a matter of weeks suggested that the gains were unsustainable and, while the Bitcoin bulls talked up the prospects of Bitcoin hitting the dizzying heights of $100,000 and more before the end of this year, the reality has certainly taken a bite.

Of particular interest is why few if any have mentioned the words bubble and burst, as for Bitcoin alone, a 75% slide from December’s all-time high would have shaken any of the major equity markets into submission.

To put it into perspective, the NASDAQ tumbled by 71% from its peak to trough in the dot.com meltdown and, while few will say that blockchain technology is worth less than the paper it’s written on, the reality is that many of the crypto coins traded across the crypto exchanges today are traded based on a white paper and concept, with few actually successfully transitioning from idea to tangible product. Perhaps that alone should be an alarm bell, particularly for market historians.

Even Bitcoin’s fight to become a viable alternative to fiat money seems flawed, with its lengthy transaction times and higher fees relative to some of the other cryptocurrencies looking for a slice of the real money pie.

So, while we can expect Bitcoin and the broader market to continue to find near-term support at such low price levels, investors continuing to believe that the next crypto rally is just around the corner, one does need to question whether the current market dynamics are sustainable.

Ripple’s XRP has shown greater resilience in the lead into and after the Bitcoin Cash hard fork and much of this has to be attributed to the team’s success in delivering an array of real-life blockchain products that have been adopted by institutions as a means to remit monies cross-border.

The team’s success is certainly far greater than any of its peers and to be fair, one does question why Ripple’s XRP has not replaced Bitcoin at the top of the crypto list by market cap, though it may just be a matter of time now and, if the general trend continues, the Ripple effect may evolve into a wave of support that could accelerate XRP’s ascendancy to the top.

We can expect investors to be licking their wounds following last week’s losses and Monday’s sell-off, which may well provide some early gains for the broader market this morning, but the reality is that investors may begin to wonder whether the latest sell-off and the effects of last week’s Bitcoin Cash hard fork on the broader market is reason enough to hold back on the Bitcoin ETF approvals.

Some institutional investors will be lining up for a piece of Bitcoin at sub-$5,000, but the smarter money may hold back for just that little bit longer, with even the more bullish of the Bitcoin bulls likely to be calling an end to the broad-based market sell-off in hope rather than certainty.

For those that are interested in the numbers, the cryptomarket cap has tumbled from last December’s $828.54bn all-time high to $159.72bn and, while this is obviously not an all-time low, it’s 2018 low and, when considering the continued rise in the number of cryptocurrencies, this market has been going in reverse through the year and it may take more than the SEC to stop the rot.

Bitcoin Sinks as the Bears Put the V back into Volatility

bitcoin sink

Complacency may well have crept into the cryptomarket in recent weeks, some particularly tight ranges across the majors raising questions on whether the market will ever be the same again.

Wednesday’s sell-off was certainly a reminder of just how choppy the markets can get for no apparent reason, with the Bitcoin Cash hard fork and battle between the 2 camps have been headline news for a number of days and certainly not a market shock to deliver Wednesday’s blow.

Putting it into perspective, Bitcoin’s 8.31% slide may be alarming when looking at moves in recent weeks, but the reality is that even listed companies on the global equity markets have seen bigger swings in recent days and that’s not even considering the pot stocks that have demonstrated volatilities comparable to the cryptomarket of old.

Was that the bubble burst, or just another speed bump on the way to a mature market?

It’s far too early to tell and how the market responds to Wednesday’s sell-off will be key, as will the outcome of today’s Bitcoin Cash hard fork, the ultimate issue being the lack of decentralization if a 51% attack can bring down an entire blockchain, where the nodes and general network are supporting one side and the mining power supports the other.

A lack of general consensus across exchanges on how to handle the hard fork has also added to the negative sentiment felt across the market, with exchanges announcing a freeze on all BCH trading and transactions ahead of the hard fork and decisions to wind up BCH futures in fear of price manipulation amongst some of the issues the market has been facing this week.

Looking at where support sits for the rapidly approaching hard fork, Bitcoin Cash SV’s futures price stood at 0.3683 BCH at the time of writing, down 10.1% over the last hour after a relatively range-bound morning. Bitcoin Cash ABC futures stood at 0.64211 BCH at the time of writing, up 8.2% over the last hour, futures prices have provided some support to Bitcoin Cash, which has found support from the futures moves, up 0.92% to $457 at the time of writing.

Hash rates will tell a different story however and, with Bitcoin miners jumping over in search of a quick hard fork Bitcoin Cash SV, Bitcoin’s hash rate has been on the decline through November, falling from a 1st November 60.4225E to 14th November 47.3755E, the downward trend contributing to the negative bias seen in Bitcoin over the last 2-weeks.

For Bitcoin Cash, the hash rate has been steadily rising, up from a 1st November 3.5427E to a 14th November 4.9332E, though for Bitcoin Cash and the broader market, the interest will be more on the hash rates for Bitcoin Cash ABC and Bitcoin Cash SV later today…

Bitcoin Cash – Market Jitters Ease Ahead of the Hard Fork

bitcoin cash

Market sentiment towards Thursday’s hard fork has shifted in favor of Bitcoin ABC and the early morning gains in Bitcoin Cash certainly reflect a sense of calm, though it’s too early to be counting one’s chickens just yet.

Looking across at the respective futures prices for Bitcoin ABC and Bitcoin SV, we’ve seen a pullback in Bitcoin SV, which has been in reverse through the early hours of this morning, falling from an all-time high $209.19 to $175.50 at the time of writing, an 18.3% fall this morning, which is quite a significant statement.

For Bitcoin ABC, it’s a somewhat different story, but nonetheless continuing to reflect a shift in favor of the Bitcoin ABC team ahead of the fork, with the futures price standing at 0.6767694 BCH at the time of writing, an upward trend having kicked in through the early hours of this morning, with Bitcoin ABC rising from 0.59206 BCH to a morning high 0.68889 BCH before easing back.

If it was down to the futures price alone, the forward guidance would be a Bitcoin ABC victory, but it’s the hash rate and not the futures price that wins the war.

On the hash rate side of the equation, the war has been heating up. While CoinGeek is reported to have 36.8% of the Bitcoin Cash network’s hashrate, Bitmain, which backs the Bitcoin ABC camp, is one of the largest holders of Bitcoin Cash. Calling on the Chinese mining farm community, Bitmain has asked for the deployment of almost 100,000 Antminer S9 miners ahead of the hard fork. A deployment of this magnitude would certainly shift the balance, though it remains to be seen whether the Bitmain team was able to muster up enough support to take it on the day.

BCH/USD Daily Price Forecast – Bitcoin Cash Bouncing From Fibonacci Support

Bitcoin Cash

Price behavior in Bitcoin Cash is showing a reversal from the prior trends posted during the early parts of November.  Against the U.S. dollar Bitcoin Cash has rallied sharply since the beginning of the month, and BCH/USD is currently posting a corrective move as a means to work off its overbought price conditions. All of this activity has increased volatility in the instrument but we are currently coming into some important technical levels which can be used for new positioning stances in the sessions ahead.

  • Critical Resistance:   646.80
  • Critical Support:   410.10
  • Trading Bias:  Moderately Bullish
  • USD/CNY Forex Strategy:  Buy at 503.10  

These latest impulse moves in BCH/USD have sent the pair back into Fibonacci support on the 2-hour charts.  If we measure from the lows from late October to the highs from November 8th (at 646.80), we can see the 61.8% Fibonacci retracement comes in close proximity to historical support levels (at 503.10).  The confluence of historical support and Fibonacci retracement readings strengthens the level of importance for the 503.10 price zone.  This suggests that we can use this level as tradable support in the establishment of new positioning stances.

Bitcoin Cash Chart
Bitcoin Cash Chart

Given the extent of the market’s recent price moves, short-term swing traders may elect to stop out the position if these Fibonacci support levels are broken.  A downside violation of 503.10 suggests a full retracement of the prior bull wave and targets a move back into support at 410.10.  With the two-way activity which has defined sentiment for this month, it makes sense to be aggressive with stop losses and take profit levels over the next few sessions.  Prices are currently caught within the moving average cluster, and indicator readings are almost exactly at mid-range (which softens the bullish bias).