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Bitcoin Price Regains $6,600 as Volatility Hits New Yearly Low

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Bitcoin’s price swung higher on Thursday, though upside momentum appears to be limited by weak underlying momentum. That being said, a key indicator of bitcoin’s volatility declined this week to its lowest level since May 2017, signaling renewed calm in the market.

BTC/USD Update

Bitcoin’s value reached an intraday high of $6,648.80 on Bitfinex. BTC is currently trading hands at $6,586.30, having gained 1.3% from the previous session. The leading digital currency fluctuated within a $155 range on Thursday.

Trading volumes in BTC have fallen back below $4 billion, which is normally seen as a bearish indicator for short-term prices. Bitcoin typically requires daily trade volumes of at least $4 billion to generate a meaningful short-term rally.

At current values, BTC is capitalized at $114 billion, which represents 52% of the overall market share.

Despite the sudden rebound, bitcoin remains locked in a perpetual bear market that is unlikely to let up anytime soon. Recent price data show weaker rebounds and lower highs for the digital currency, which means investors can expect downside pressure to persist.

The broader cryptocurrency market added roughly $5 billion to its value on Thursday. Combined, the digital asset class is currently sitting at a value of $219.4 billion, according to CoinMarketCap. Overall trading volumes across all digital assets and exchanges fell to $12.8 billion.

Volatility Declines

Prior to Thursday’s rebound, bitcoin’s price action was exhibiting the lowest volatility in roughly 15 months, according to bitvol.info. The bitcoin volatility index, which tracks the cryptocurrency’s price variance over time using the standard deviation of daily open prices, has declined to 2.52% in the 30 days through Wednesday.

Volatility has been in firm retreat for much of 2018, a trend that some attribute to the rise of futures trading. Contrary to popular belief, the introduction of bitcoin futures last December has been accompanied by a decline in large price swings for the digital asset.

Despite struggling to reverse the bear market, bitcoin’s supporters have established a healthy price floor at $6,000. This key level ensures that miners can continue their operations without losing money.

The leading digital currency could see larger price swings over the next two weeks as traders prepare for the next CBOE futures expiry. The current CBOE XBT bitcoin futures contract expires on Oct. 17. It is not uncommon for bitcoin’s price to fall into expiration.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 772 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Bitcoin

Bitcoin Blows Past $4,000 as Volume Surges to 10-Month High

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Bitcoin’s bulls maintained full control of the market on Tuesday, as the BTC/USD exchange rate crossed $4,000 for the first time since early January. In the process, exchange-based volumes surged to their highest levels in ten months.

BTC/USD: Breakout Eyed

The bitcoin price crossed $4,000 on Bitfinex and reached a session high of $4,048, the highest since Jan. 8. At the time of writing, BTC/USD printed $4,006.30 on Bitfinex, having gained 0.7%. The leading digital currency has maintained strong momentum amid the latest rally, according to the hourly relative strength index (RSI).

Aggregate data provided by CoinMarketCap show an average bitcoin price of $3,921.67 as of Tuesday morning. That’s a gain of 4.2% over 24-hour cycle.

Read more: Bitcoin Surges to Five-Week High; Crypto Bulls Reignite?

In terms of technical indicators, bitcoin must return above $4,200 to negate the long-term down trend This represents the high from late December and was also the 15-week moving average prior to the last breakout attempt. Beyond that, the bulls must return above $5,500 and eventually break the 50-week moving average near $6,800 to convince traders that a full-blown recovery was afoot.

Has Bitcoin Bottomed? A Closer Look at the Bullish and Bearish Cases

Trade Volumes Surge

The rally on Tuesday is a continuation of a sudden breakout that began more than 24 hours ago. On Monday, bitcoin and the broader cryptocurrency market rose to five-week highs thanks to a confluence of technical and fundamental forces.

A significant rise in trade volumes has underpinned the market’s push north. More than $10 billion worth of bitcoin traded hands on virtual exchanges in the last 24 hours. According to CoinMarketCap data, that the highest since April 2018. Virtual currency exchanges processed nearly $36 billion worth of cryptocurrency transactions over the same period.

The following chart highlights the extent of the volume surge on individual exchanges. Three exchanges processed more than $1 billion in adjusted volume; 12 more reported adjusted volumes of $500 million or greater. The billion-dollar exchanges are Binance, Bit-Z and OKEx.

The volume surge has contributed to higher volatility over the past two days. As of Monday, bitcoin’s 30-day volatility index rose to 2.24%, according to bitvol.info. That’s a gain of 32 basis points from Sunday, when volatility fell to three-month lows.

For crypto traders, volatility is a double-edged sword. Dramatic swings in prices make it more difficult to time their market entry or to rely on technical analysis to determine future positions. High volatility can also lead to rapid declines in prices. At the same time, the 2017 bull market showed that volatility can lead to parabolic gains for bitcoin and its altcoin peers.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 772 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Analysis

Crypto Update: Ethereum Leads Second Phase of Rally

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The major cryptocurrencies are all significantly higher today amid the US market holiday, with most of the top digital currencies also hitting their highest levels in a month. Today’s leaders also took out the highs set during the Litecoin-led spike 10 days ago, and the new swing highs mean that the counter-trend move continues. The negative long-term forces a

Our trend model is still on short-term buy signals in most cases, with the relatively weak Ripple still being the most important exception, but for now, the bearish long-term picture is unchanged, and traders should still use strict risk management strategies, as, despite the rally, bear market rules still apply. That said, investors could hold on to their smaller speculative positions, since the short-term break-out patterns in the segment remain intact, despite the still dominant negative long-term forces.

ETH/USD, 4-Hour Chart Analysis

Ethereum built upon its recent short-term relative strength, surging past the $120 and $130 resistance levels, outperforming its closest peers and leading the way higher for the whole segment. With the new swing high, a new short-term uptrend is established, and our trend model remains on a short-term buy signal, but the long-term trend remains bearish.

The long-term outlook is still negative for ETH, but the coin could test the $160 resistance level, which marked the top of the previous counter-trend move in the coming days. The coin is currently trading near the $145 resistance level, and although it’s slightly overbought from a short-term perspective, the next resistance level could be reached in the coming days.

BTC/USD, 4-Hour Chart Analysis

While Bitcoin has been slightly lagging behind Ethereum during the current rally, it not just recaptured the $3600 support/resistance level, but also managed to rally up to the next key zone near $3850. BTC remains on a short-term buy signal in our trend model despite its relative weakness, but from a long-term perspective, it’s still in a clearly bearish setup.

With that in mind, investors should still expect a move towards the $3250 and $3000 support levels following the current counter-trend move, but traders could still hold smaller, speculative positions in the coin. Further strong resistance is ahead between $4000 and $4050, while below $3600, support is found just above $3450.

XRP/USDT, 4-Hour Chart Analysis

Ripple continues to be relatively weak compared to the broader market, and although it topped the $0.32 level amid today’s broad rally, it’s still only neutral in our trend model even from a short-term perspective. Also, the long-term setup is still hostile for bulls, and the test of the $0.28 and $0.26 levels still seems likely in the coming weeks, with strong resistance levels also ahead neat $0.3550, and $$0.3750.

Litecoin Hits Marginal New High as EOS Soars

LTC/USD, 4-Hour Chart Analysis

LTC haven’t been able to retain its leadership during today’s move, and although it scored a new marginal swing high, ending the short-term correction, the momentum of the current upswing is not convincing. Should LTC form a failed break-out pattern, our trend model will switch to neutral, but for now, the currency remains on a buy signal.

From a long-term perspective, Litecoin is still clearly in a bearish trend, so traders and investors should only consider short-term positions, but for now the break-out remains intact. The next level of resistance is ahead near $51, while is now found near $44, $38, and $34.50.

EOS/USD, 4-Hour Chart Analysis

EOS was also among the relatively stronger coins during the recent week, and after a failed move, today it surged to a significant new swing high, hitting the $3.50 resistance in the process. Our trend model remained on a short-term buy signal, during the recent consolidation, and although traders could take some chips off the table near the $3.50 level, the short-term trend is now bullish.

That said, the bearish long-term forces are still dominant in the market of EOS, and although the coin might test the $4.50-$5 zone, odds still the retest of the bear market low near $1.55 in the coming months. That said, traders could still to their short-term positions, following strict risk management rules, with support now found near $3, $2,80, and $2.55.

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 466 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Bitcoin

Bitcoin Surges to Five-Week High; Crypto Bulls Reignite?

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Bitcoin and the wider cryptocurrency market surged to five-week highs on Monday, stoking renewed optimism that the end of ‘crypto winter’ was finally upon us. The sudden price surge was accompanied by a dramatic rise in trading volume, a phenomenon that was first observed in the fourth quarter.

BTC/USD: Price Update

The bitcoin price reached a session high of $3,864.00 on Bitfinex, levels not seen since the early part of January. At the time of writing, BTC/USD was valued at $3,843, having gained 2.9%.

Bitcoin has further room to accumulate, based on the MACD relative strength index (RSI). Both momentum indicators are flashing the ‘buy’ signal, based on the hourly chart.

Traders were paying a hefty premium on Bitfinex relative to other exchanges. The BTC price averaged in the $3,720-$3,730 range on Bitstamp, Bitstamp and Coinbase.

Looking at the big picture, bitcoin’s average price was $3,781, according to CoinMarketCap. That represents a gain of 4.2% compared with Sunday.

Volumes Surge

There was no immediate catalyst for the market’s sudden breakout on Monday. Rising trade volumes suggest that large-scale investors were absorbing more of the selling pressure that had re-emerged since the beginning of the year.

Bitcoin’s 24-hour volume improved to $8.2 billion, the highest since December. BitMEX,  a popular derivatives platform, accounted for 18% of the exchange-based volume. The spot market made up the remainder. These figures likely understate the true size of bitcoin’s market.

Related: Bitcoin’s Price Recovery Stalls as BitMEX Shuts Down U.S. Accounts.

It is estimated that over-the-counter trading accounts for at least half of global volumes. It recently came to light that “private bilateral contracts” have also surged in popularity among institutional investors. Read more: Bitcoin and Derivatives: Why $4,200 is So Critical

The dramatic surge in trading volume over the past four months suggests that a bearish-to-bullish trend reversal may be afoot. If that’s the case, the sharp rise on Monday could be the start of a major rally attempt that seeks to knock out $4,000 and $4,200. A rally above the latter is needed to negate the short-term bearish outlook.

Cryptoassets as a whole added more than $8 billion in value on Monday, as the market cap pierced above $128 billion for the first time since early January. Over the past 24 hours, trade volumes have surged by 40% to $27.4 billion, according to CoinMarketCap.

Bitcoin’s share of the overall cryptocurrency market fell below 52% on Monday for the first time since Jan. 10.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 772 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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