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Bitcoin Price Sees Modest Pullback as Crypto Market Hits Resistance

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Bitcoin’s price was knocked back below $6,500 on Thursday as part of a wider market pullback that saw yesterday’s leaders turn into today’s biggest laggards.

BTC/USD Price Update

Although much of the selling pressure was concentrated elsewhere, bitcoin still managed to fall 1.2% to $6,496.70 on Bitfinex Thursday. The leading digital currency has since climbed to around $6,541, down roughly half a percent from the previous day.

Trade volumes in the last 24 hours fell 12% to $4.5 billion, according to CoinMarketCap. Derivatives trading continues to be a major mover of the bitcoin price, with BitMEX processing nearly 14% of the daily turnover.

The latest pullback wasn’t surprising if one looks at the momentum indicators on the 4-hour chart. BTC was technically overbought on Wednesday, according to the relative strength index (RSI). The RSI is still in positive territory, which suggests that upside momentum is still in effect.

Bitcoin rose above $6,600 on Wednesday, reaching its highest level in nearly three weeks. BTC’s performance followed in the footsteps of alternative coins like bitcoin cash and XRP, whose gains in the last seven days catalyzed a much wider market rally. Over the same stretch that BCH and XRP rose more than 50% and 20%, respectively, bitcoin rose just 3%.

Bitcoin Mining Leaves Major Carbon Footprint

With bitcoin narrowly trading above mining costs, market participants have increasingly focused on output trends of the world’s largest blockchain. Although bitcoin’s carbon footprint is well documented, new research published by Nature suggests blockchain mining consumes more energy than gold production on a dollar basis.

The paper, which was developed by Max J. Krause and Thabet Tolaymat, showed that mining $1 worth of bitcoin requited 17 megajoules while the same output for gold was 5 megajoules. The only metal that consumed more energy in dollar-equivalent terms were aluminum (122 megajoules). The analysis is based on the time frame of Jan. 1, 2016 to June 30, 2018.

What’s more, the analysts argue that mining of bitcoin, Ethereum, Litecoin and Monero – four of the largest cryptocurrencies on the market – “was responsible for 3-15 million tonnes of CO2 emissions” over the same period.

Although several news outlets have tried to show that cryptocurrency mining will have a devastating impact on the environment, the researchers suggest that the adoption of new technology will ultimately lead to a reduction in greenhouse gas emissions. Case in point: Monero’s April hard fork shows a “considerable drop in network energy demand” when compared with previous energy requirements.

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 742 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Bitcoin

Bitcoin Reverses Gains as Bears Eye Breakdown of Major Support Level

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Bitcoin swung lower on Sunday, giving back all of Saturday’s gain and setting the stage for a possible re-test of a long-term support level.

BTC/USD Update

Bitcoin’s price fell 4% to $3,596.96, where it was approaching an important long-term support. That level is located at $3,550. A successful penetration south by the bears could set the stage for a bigger drop toward new yearly lows. As a refresher, bitcoin bottomed near $3,100 last month before rebounding more than 30%.

Read: Bitcoin Approaches “GTFO” Level.

The bulk of the selloff on Sunday occurred over the span of one hour beginning around 06:30 UTC. Trading volumes have remained elevated throughout the session, with roughly $5.4 billion worth of BTC trading hands on virtual currency exchanges.

More on this story: Return to $100 Billion Awaits as Crypto Market Loses $5B in One Hour.

The leading digital currency received a boost heading into the weekend, as buyers re-emerged following a period of hesitation. Bitcoin climbed back above $3,700 on Saturday before the latest reversal took root.

Broad Market Reversal

Even with the recent decline, bitcoin’s share of the overall cryptocurrency market was little changed at 52.5%. That’s because altcoins and tokens registered bigger percentage losses, with Ethereum, bitcoin cash and EOS each falling 4.5% or more.

Alternative cryptocurrencies tend to gravitate around bitcoin, especially during bearish trends. Justified or not, bitcoin continues to be a major influence on how other assets perform. At the time of writing, the total cryptocurrency market cap was worth $119.8 billion.

Trading across all virtual assets has remained elevated over the last 24 hours, with total volumes exceeding $16.7 billion. Cryptocurrencies have seen a substantial rise in circulation over the past three months as long-dormant accounts became active once again.

In less than one month, cryptoassets will enter its longest bear market in history, according to CNBC’s Ran NeuNer. As of Sunday, the bear market has stretched on for 394 days. The longest on record was seen back in 2014-15 when the bear trend lasted for 420 days.

2019 could be a year of accumulation for bitcoin, as long-term holders and institutional investors look to capitalize on low prices. As we recently speculated, bitcoin will likely prove to be an attractive investment in the $2,000-$4,000 range. The current hesitation reflects uncertainty about whether the market has reached a definitive bottom.

Read: Bitcoin’s Year of Accumulation.

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 742 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Altcoins

Crypto Markets Get a Boost Heading Into the Weekend as Debate Over Bitcoin ETF Intensifies

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Cryptocurrency prices rose on Saturday, alleviating the risk of an imminent pullback following days of mostly lateral moves. As history has shown, longer periods of sideways trading are often followed by brisk selloffs in bitcoin and altcoins.

Flush of Green

The biggest cryptocurrencies all reported gains at the start of the weekend. Bitcoin, the largest by market cap, climbed back above $3,700 in a show of momentum for the bulls. At last check, the bitcoin price was valued at $3,744.11, having gained 2.5% from Friday.

Bitcoin’s price broke out on Monday but failed to generate sustained bids throughout the week. As a result, it spent most of that period hovering between $3,600-$3,700. Bitcoin faces a major long-term support at $3,550; a break below this key level could be a momentum killer for the bulls.

The leading digital currency continues to be a good barometer for the overall market. With a market dominance rate of 52.5%, bitcoin has a direct impact on how altcoins and tokens perform. It comes as no surprise that coins other than bitcoin rose by more than $2 billion on Saturday, according to CoinMarketCap.

The total market cap of all cryptocurrencies improved to $124.7 billion, up markedly from a 24-hour low of $120.9 billion.

Litecoin was the top gainer among major cryptos, rising 4.4% to $32.65. XRP added 1.7% to $0.3313, Ethereum climbed 2.5% to $125.01 and bitcoin cash rose 1.4$% to $130.70.

Outside the top-ten, IOTA rose 4.1% to $0.3246. NEO advanced 5% to trade at $8.09.

Bitcoin ETF Debate Continues

The U.S. Securities and Exchange Commission (SEC) has a big decision to make in roughly five weeks: approve or reject the VanEck SolidX Bitcoin Trust. Unlike previous crypto ETF applications, the VanEck-SolidX application proposes a physically-settled bitcoin fund that addresses many of the SEC’s ongoing concerns around investor protection and market manipulation.

Some investors are clinging to the hope that SEC approval of the VanEck-SolidX product will give the market a much needed boost by the end of the first quarter. But the impact of the approval/rejection could depend largely on how the market performs heading into the decision, now slated for Feb. 27. As Hacked reported last month: “The rejection of an ETF approval could affect the market if the price of Bitcoin has been increasing in anticipation of the announcement.” More here.

The consensus among analysts and market observers is that the SEC is unlikely to approve any bitcoin ETF this year. This view was recently echoed by bitcoin bull and CNBC contributor Brian Kelly, who says the bitcoin futures market isn’t mature enough to allow for an ETF to be approved. He didn’t comment specifically on the VanEck application, which has been designed as an alternative to futures-linked products by holding a repository of physical BTC as opposed to derivatives.

The SEC’s Office of Compliance Inspections and Examinations (OCIE) named crypto as one of six regulatory focal points for 2019. In a recently released report, OCIE said: “Given the significant growth and risks presented in this market, OCIE will continue to monitor the offer and sale, trading, and management of digital assets, and where the products are securities, examine for regulatory compliance.”

For more on this story, read: As Race for Bitcoin ETF Heats Up, SEC Identifies Cryptocurrency as a Top Priority in 2019.

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 742 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Analysis

Crypto Update: Coins Drift Lower but Damage Remains Limited

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The major cryptocurrencies continue to trade in narrow ranges following last week’s decline and this week’s failed rally attempt. While Bitcoin is stuck near the $3600 support, the other top coins have been losing ground today, with Ethereum dipping below the $120 level, Ripple violating the $0.32 price level and Litecoin testing the $30-$30.50 support zone yet again.

Trading volumes and volatility remain very low across the board, but correlations are still high between the majors, and despite the quiet environment, we haven’t seen bullish signs in the market. That said, the trading ranges that developed this week are still intact, and although the overwhelmingly bearish long-term picture still makes the continuation of the decline more likely, a failed break-down pattern could still develop in the segment, should the top coins recover above their weekly highs in the coming days.

For now, our trend model remains on sell signals on both time-frames in case of most of the majors, and traders and investors should still stay away from entering new positions here, with still no bullish leadership being present.

BTC/USD, 4-Hour Chart Analysis

Bitcoin is still relatively stable even in the very quiet environment, and the most valuable coin is trading right at the $3600 support/resistance level. BTC formed a volatility compression pattern in recent days, and that formation points to a more significant move in the coming days, with a move out of it being inevitable as soon as this weekend.

Bulls are still looking for a move above $3850, towards the key zone between $4000 and $4050, but the bearish long-term setup continues to favor a dip below $3600, with support zones still found near $3250 and $3000, and traders and investors should still not enter positions here.

ETH/USD, 4-Hour Chart Analysis

Ethereum failed to get close to the $130 resistance level again, and as it dipped below primary support, the test of the swing low near $112 is likely in the coming days. The coin remains on sell signals on both time-frames in our trend model, and a move towards the key support zone and between $95 and $100 is likely in the coming weeks, barring a quick reversal above $130. Further resistance is ahead at $145, $160, and near $180 while the bear market low is found near $80

Ripple Under Pressure Again in Weak Environment

EOS/USD, 4-Hour Chart Analysis

Altcoins continue to trade without a clear direction despite today’s dip, but the bearish drift of the recent days means that the key support levels could be in focus during the weekend, should the volatility compression finally end. The few major coins showing signs of strength haven’t been able to maintain the bullish momentum, like EOS, which gave back yesterday’s gains today.

XRP/USDT, 4-Hour Chart Analysis

While the market of Ripple is still very quiet, the coin fell below the $32 support yet again, and it remains relatively weak compared to its closest peers. It is also on sell signals on both time-frames in our trend model, and a dip below $0.30 will likely be the next significant move. Further strong support is found near the $0.26 level, with resistance ahead near $0.3550 and $0.3750.

LTC/USD, 4-Hour Chart Analysis

Litecoin is trading just above the key $30-$30.50 support zone, and it sill failed to get anywhere near the next major zone near the $34.50 price level. Given the hostile long-term setup and the short-term sell signal our trend model, traders should stay away from the coin here, with a move toward the $26 level being likely in the coming weeks. Further strong resistance is ahead near $38 and $44 and with another support level found near $23.

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 444 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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