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Bitcoin Tops $11,000 for the First Time in Three Weeks as Rally Continues

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The price of bitcoin rose more than $1,000 on Monday, reaching its highest level in nearly three weeks as the crypto market extended its recovery from recent lows.

BTC/USD Price Levels

Bitcoin surged to a session high of $11,274.74 before paring some of those gains in afternoon trade. At the time of writing, the BTC/USD exchange rate was worth $11,140 for a gain of $1,057 or 10.5%. With the gain, bitcoin has recovered nearly 90% from is Feb. 6 low.

At current prices, bitcoin has a total market capitalization of $189 billion, easily tops among cryptocurrencies. More than $7.6 billion worth of BTC was traded over the past 24 hours. The most active exchanges were Bitfinex, OKEx and Binance, according to latest available data from CoinMarketCap.

The Battle of Sentiment

Bitcoin has added 26% over the past five days as bottom pickers and speculators returned to the market. The gains have been associated with a broader uptick in the cryptocurrency market, which is now worth more than $500 billion. Although the technical indicators suggest that a long-term revival is still in jeopardy, speculators are betting that bitcoin will return to its glory days where record highs were the norm.

That’s exactly what an anonymous trader did earlier this month when bitcoin was in free-fall. As Hacked reported this weekend, an anonymous “bitcoin whale” sunk $400 million on long positions involving BTC. According to Fortune, the majority of the 41,000 tokens were purchased on Feb. 9, with an additional 9,000 purchases made three days later.

Bitcoin has had a long and volatile history of ups and downs, making the recent swings not entirely unusual. However, an analysis of the Relative Strength Index (RSI) suggests that bitcoin prices dipped below key support zones during the most recent selloff, which could signal the presence of bear market conditions. Although the RSI has since recovered, some analysts have indicated that the recent bout of volatility could be a sign of more adverse trading conditions moving forward.

That was the general idea behind an interesting forecast put forward by DataTrek’s Nick Colas, who last December predicted bitcoin’s trading range to be $6,500 to $22,000 this year. He mentioned the likelihood of multiple “crashes,” which he described as large drops of 40% or more. It took less than two months for Colas’ prediction to come to fruition.

The author generally agrees with Colas’ assessment and expects further price volatility in the near future as dramatic falls give rise to even bigger gains. An understanding of investor sentiment explains why this is the case.

Bitcoin, like other digital currencies, is heavily exposed to FUD and FOMO – two acronyms that tell the story of its recent price movements. “Fear, uncertainty and doubt” regarding cryptocurrency regulation was largely responsible for bitcoin’s fall from grace in January and February. As prices bottomed, “fear of missing out” led more traders back into the market. It remains to be seen how this mentality will drive bets in the derivatives market, which offers an other venue for direct exposure to bitcoin.

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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4.6 stars on average, based on 609 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Bitcoin

Bitcoin Network Faced One-Two Punch of Inflation and DoS Threats

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Bitcoin Core has emerged seemingly unscathed from a major vulnerability that threatened to shut down parts of the network in a denial-of-service (DoS) attack. But apparently, the bug was even worse than originally thought. According to a Bitcoin Core Full Disclosure Report, the issue included an “inflation vulnerability,” one in which if seized upon could have bolstered the supply of bitcoin beyond the famous 21 million coin ceiling. By pouring more coins into the supply, the hackers would have diminished the value of the circulating bitcoins.

The decision to expose only the lesser extreme part of the bug to the public was deliberate. According to the report:

“In order to encourage rapid upgrades, the decision was made to immediately patch and disclose the less serious Denial of Service vulnerability, concurrently with reaching out to miners, businesses, and other affected systems while delaying publication of the full issue to give times for systems to upgrade. On September 20th a post in a public forum reported the full impact and although it was quickly retracted the claim was further circulated.”

Double-Edged Sword

The strategy was a success and the bug is no longer a threat, as evidenced by more than 50% of the bitcoin mining hashrate having been upgraded to the patched nodes with no known attempts to “exploit this vulnerability.”

Here’s what we know, according to the report –

“A developer by the title earlz independently discovered and reported the vulnerability to the Bitcoin Core security contact email.”

Meanwhile, on social media, a contributor identified as a Bitcoin Cash developer who goes by the handle “Awemany” was cheered on Reddit for discovering and reporting the bug and cementing their place in “bitcoin’s history book.” Awemany in a blog post pointed to bitcoin developer Matt Corallo, whose 2016 pull request in an attempt to accelerate validation times led to what Awemany characterized as “one of the most catastrophic bugs in Bitcoin ever.”

The bottom line is that the bug was discovered and the threat has been lifted. It’s both a reminder of the risks associated with the consensus mechanism and a demonstration of good faith among the decision makers.

While it’s mostly the future of ETH that has been contemplated of late, given the plummeting of the No. 2 cryptocurrency’s value this year along with the confidence of investors, bitcoin has its own issues. In an exclusive interview with CCN, Sheffield Clark, who is at the helm of bitcoin ATM maker Coinsource, pointed to potentially “stagnant” mainstream adoption of bitcoin amid a lack of regulatory framework to help resolve issues like extreme volatility.

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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4.6 stars on average, based on 61 rated postsGerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.




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Bitcoin

Bitcoin Price Crosses 50-Day MA amid Seller’s Fatigue

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Bitcoin is charting a bullish reversal after an impressive Friday rally pushed prices back above the 50-day moving average.

BTC/USD Update

Bitcoin’s price clocked a high of $6,840.90 on Bitfinex Saturday, the highest in over two weeks. BTC was last seen trading at $6,678, having declined 1.2% from the previous session.

The leading digital currency shot up $400 on Friday after the U.S. Securities and Exchange Commission (SEC) announced it will delay a ruling on the highly touted VanEck SolidX Bitcoin Trust. The broader market was in a firm uptrend thanks to XRP’s triple-digit surge.

Bitcoin is now trading above the 50-day moving average, an important indicator for the bulls. Relative strength has weakened over the past 24 hours but remains in positive territory.

The bulls have a lot more work to do to ensure a stable recovery in the bitcoin price. Although BTC has successfully defended its key support, the market has been characterized by lower highs since mid-July.

At current values, bitcoin’s total market capitalization has risen to $115.2 billion. However, its share of the overall market has depreciated considerably. At the time of writing, bitcoin’s dominance rate was below 52%, according to CoinMarketCap. It recently peaked above 58%.

Classic Bottom?

Michael Novogratz, the billionaire investor and founder of Galaxy Digital, believes bitcoin is due for a strong comeback as “seller fatigue” takes hold.

Speaking at the second annual “All Markets Summit” hosted by Yahoo Finance, Novogratz said crypto assets will be back on the upswing following the boom-and-bust cycle of the last two years. According to Galaxy Digital’s cryptocurrency index, the market has experienced a “classic bottom” that will make the top-ten coins more attractive in the foreseeable future.

“Bitcoin has held $6,000. Yes, it is off its highs, but it has established itself as a store of value,” Novogratz said, as quoted by Reuters.

The $6,000 price point has proven to be a formidable support zone for bitcoin as it is commonly cited as the break-even point for miners. The launch of bitcoin futures in December has also contributed to a sharp decline in volatility – albeit incremental – which appears to have set the price floor at or around $6,000. Although the market has breached this level on multiple occasions, each breakdown proved to be short-lived.

In terms of institutional adoption, Novogratz believes there are sizable sums of money currently waiting to be invested. This view conforms with the business strategy being employed by Coinbase, one of the world’s largest cryptocurrency exchanges, which has developed new custody services to attract institutional investors. Coinbase believes there is currently $10 billion in institutional capital sitting on the sidelines.

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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4.6 stars on average, based on 609 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Analysis

Crypto Update: Market Stabilizes as Ripple Craze Fades

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The major cryptocurrencies had crazy Friday, with the skyrocketing Ripple in the center of attention. XRP more than doubled in 24 hours, and the coin was up 3 times off its low from earlier this month before entering a correction in the second half of the day. Ripple briefly took over Ethereum as the second largest coin by market capitalization, even as ETH also hit an almost three-week high amid the broad rally in the segment.

XRP/USDT, 4-Hour Chart Analysis

XRP settled down above the $0.50 level near the market cap of ETH, but short-term the coin is severely overbought, and a pullback to the $0.42-$0.46 zone is still very likely even if the coin manages to hold on to its stellar gains and enter long-term rising trend. For now, a long-term trend change is not confirmed, despite the huge bullish move, with most of the segment still being in bearish long-term trends.

That said, the short-term buy signal is still intact in our trend model, and should the overbought readings get cleared, traders could enter new positions again. Support levels are found near $0.54, $0.51, while resistance is ahead near $0.57, $0.64, and $0.75.

BTC/USD, 4-Hour Chart Analysis

Bitcoin got up to $6750 yesterday, but so far, it failed to overcome the resistance zone near that price level, and the coin is now trading in a shallow short-term correction. BTC needs to stay above the $6500 support to maintain the break-out that followed Ripple’s surge and to remain on a buy signal in our trend model.

The fact that correlations are still declining between the coins is a positive sign, but the overall bearish picture in the segment and Bitcoin’s proximity to the key long-term zone still warrant caution here. Further resistance zones are now ahead near $7000 and between $7200 and $7300, while support below $6500 is still found at $6275, $6000, and near $5850.

Altcoins Pull Back with Ripple, Short-Term Setup Still Promising

ETH/USD, 4-Hour Chart Analysis

Ethereum finally broke above the key $235 support/resistance level thanks to yesterday’s broad rally, and the coin reached the next major resistance zone near $260 as expected after the bullish move. Now the dominant declining trendlines are not far away, so traders should reduce their positions, since the long-term trend is still clearly bearish.

A test of the lows is still in the cards in the coming weeks, and the coin remains on a long-term sell signal despite the short-term rally.  Support is found near $200, $180, at the low near$170, and at $160, while further resistance is ahead between $275 and $$280 and at $300.

Stellar/USDT, 4-Hour Chart Analysis

Stellar was among the strongest coins during yesterday’s rally, following Ripple higher, but now it is testing the key support/resistance zone between $0.2375 and $0.25 after entering a correction together with the broader market.

That said, the break-out is intact in Stellar, and traders could hold on to their positions here. Support levels are found near $0.21, $0.1930, and $0.1830, while further resistance is ahead near $0.2650 and $0.2850.

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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4.6 stars on average, based on 351 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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