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Bitcoin Cash (BCH) Is Getting Crushed

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Bitcoin Cash (BCH) declined sharply on Monday, falling in lockstep with other altcoins as bitcoin extended its dominant grip on the market.

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BCH Nosedives

Bitcoin Cash is down more than 10% against the dollar to trade just above $306. The token is fast approaching two-month lows after prices failed to gain traction north of $360 last week. The BCH/USD is down more than 40% since Sept. 19, and is trading at roughly one-third its all-time high.

The outlook on BCH is strongly bearish as prices approach the $300 handle. A break below that level would expose all-time lows for the cryptocurrency.

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On the basis of market cap, BCH has fallen to No. 4 on the list of global cryptocurrencies. It now trails Ripple (XRP) by roughly $4.5 billion.

Bitcoin Cash has struggled to win over investors after the Aug. 1 hard fork. Over that period, prices have fluctuated from a high near $900 to a low in the mid-$290 range, according to CoinMarketCap.

BCH and BTC Moving in Opposite Directions

Amid the latest turmoil in altcoins, bitcoin (BTC) is fast approaching record territory. The BTC/USD exchange rate reached a session high of $4,870 on Monday before pulling back toward the $4,790 region.

Bitcoin is hogging all the spotlight ahead of possible fork of the digital currency by November. We reported earlier today that bitcoin’s share of the total cryptocurrency pie climbed back above 50%, a bullish sign for the world’s top digital asset.

The BTC token is also benefiting from speculation that Goldman Sachs is planning to trade the cryptocurrency following an initial evaluation of the market.

It’s also worth mentioning that Chinese sources have also reported that the recent crackdown on cryptocurrency is not as severe as previously believed.

The direction of the cryptocurrency market is anyone’s guess at this point. What seems clear is that the market is no longer as contained as it once was. Investors can therefore expected “collateral damage” to certain segments of the financial markets if bitcoin prices join BCH and others near the bottom of the barrel.

According to TD Ameritrade, chipmakers Nvidia and Advanced Micro Devices could become the center of a selloff in the event of a bitcoin market collapse. These companies are especially vulnerable to bitcoin price fluctuations because they produce the graphic processors used by the mining industry.

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Cryptocurrencies

Ethereum Founder Says Central Banks are Incapable of Creating Own Cryptocurrency

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Cryptocurrency art

Central banks have expressed keen interest in creating their own cryptocurrencies, probably in realization that blockchain-powered assets are more than just a fad. It’s too bad they lack the paradigm to do so, says Ethereum founder Vitalik Buterin.

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Vitalik Doesn’t Think They Can Do It

A central bank-backed cryptocurrency would simply amount to “a server and a bunch of marketing buzzwords to make it look like a blockchain,” says Buterin, according to Jeff John Roberts’ latest Fortune report.

The 23-year-old Buterin said it would take years for central banks to mint their own coins, suggesting that existing blockchains needn’t be worried about competition from government.

Indeed, central bankers have spent the past few years mulling over the impact of cryptocurrencies on traditional payment methods. It’ll be another few years before they develop a system comparable to bitcoin or Ethereum, if at all.

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Russia could become the first case study in government-backed cryptocurrency. Reports from TASS suggest that central regulators are embarking on a ‘CryptoRuble’, or a digital currency system backed by fiat money.

Buterin is a native of Russia, but currently resides (at least partially) outside Toronto. That may explain his recent visit to the three-day Swell conference in the city. The event was hosted by Ripple, the world’s third-largest digital asset by market cap.

Can Governments Contain Cryptocurrency?

Buterin has raised awareness of the irony in proclaiming a centrally-controlled cryptocurrency. By definition, a cryptocurrency cannot be contained within a single jurisdiction, since mining can carried out by anyone, anywhere. This is perhaps what’s making central bankers so nervous. Although Russia’s CryptoRuble aims to centralize the mining of cryptocurrency, it’s unclear how such a system would be administered.

The inherent tension between central banks and cryptocurrencies will likely grow over time as more people use digital tokens as payment. With the exception of bitcoin, cryptocurrency has yet to take off as a payment method. Japan could very well be the first case study in how quickly bitcoin will be adopted to pay for goods and services. The world’s third-largest economy has already recognized cryptocurrency as a legal payment method, leading to speculation that hundreds of thousands of domestic merchants will start accepting payments within the first year.

Featured image courtesy of Shutterstock. 

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Technical Analysis: Coins Recover from Sell-Off as Bulls Remain in Control

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Following yesterday’s brief but deep correction, the major cryptocurrencies seem to be back on the bullish track, as Bitcoin is leading the segment yet again. With the most valuable coin’s dominant currently near 56%, trading in BTC dwarfs the other crypto markets. That said, most of the majors recovered well after yesterday’s rout, while Bitcoin itself reached as high as $5730 today in early trading, only a few percents off its all-time high.

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The short-term setup is encouraging for bulls, as the coin cleared the overbought short-term momentum readings while remaining inside the rising trend. A rally towards the long-term target at $6000 is still likely, despite the stretched long-term picture. Support levels are found near $5400, around the $5000 level and at $4650.

BTC/USD, 4-Hour Chart Analysis

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Ripple settled down somewhat in early trading but it turned volatile again later on, and the coin is still underperforming the broader market, while Ethereum bounced back well above the $300 level, remaining well below its recent highs. The rest of the market is modestly higher today, although NEO and IOTA are slightly lower still showing a negative correlation with the other majors. Let’s see the short-term charts after the short volatile period.

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Cryptocurrencies

Trade Recommendation: Zcash

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The price bounced from 220.00 support level. RSI and a reversal candlestick pattern confirmed price reversal. DMI shows range market conditions and we can wait for a volatility breakout with further strong price movement. In order to catch such movement we should placed pending orders for buy at 235.00 level. Buying from this level, we do it not far from the possible bottom. Stop orders must be at 212.00 level which is below the local swing low. Profit targets are 300.00 and 400.00 levels. If you don’t use leverage, recommended trading volume for this trade is up to 10% from your deposit.

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Market: ZECUSD
Buy: 235.00
Stop: 212.00
Profit Targets: 300.00 and 400.00

The trading signal is based on Poloniex chart.

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