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Bitcoin

She’s Gonna Blow!

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The meteoric rise of bitcoin has accelerated yet again as the world’s number one digital currency broke a new record raising $2299 a coin in a 24-hour window.

Blogging about the price of bitcoin can be extremely frustrating at times with many articles becoming irrelevant even before they ever get to print. I’ve seen this before myself with several articles I was collaborating on but it seems to be an industry-wide thing.

Imagine, somebody from Reuters worked very hard on this article announcing bitcoin’s rise above $13,000 and within an hour of the time it was published the price had already breached $14,000.

For me, I’ll always do my best to give you the causes behind the moves and whenever I can inform my readers what could likely drive the prices going forward. For all we know, a major pullback or an additional surge may have already happened by the time you read this.

@MatiGreenspan
eToro, Senior Market Analyst

 

Please note: All data, figures & graphs are valid as of December 7th. All trading carries risk. Only risk capital you’re prepared to lose.

Market Overview

Excitement is hardly the word to use but we’ll go with that for now. Nowhere is it more exciting than in South Korea. At the moment, a single bitcoin on the South korean exchange Bithumb is going for 19,391,000 KRW ($17,645 USD), which is 17% higher than the price listed on eToro at the time of this writing.

Recent estimates state that 21% of all global BTC volume are done in Korean Won. So what makes bitcoin so exciting for Korean traders?

I mean, aside from the same thing that makes it exciting for the rest of us. The idea of replacing our monetary system to be fairer and less reliant on inefficient and at times irresponsible government applies to South Korea even more than the rest of us for two reasons.

One, the obvious, they’re watching what’s happening in North Korea where the government has completely taken over the country. So they have a far fresher perception of what can happen when governments go bad.

Two, after recently going through a political meltdown and ousting the former President Park Geun-Hye, and after watching the CEO of the Samsung go to prison on corruption charges, their faith in the system is currently at a justifiable all time low.

Third, investing in bitcoin requires a certain appetite for risk that isn’t present everywhere but seems to be present just South of Kim Jong Un’s border.

Regulators in South Korea are doing their best to get a handle on the situation but are visibly struggling. They’ve already banned ICOs in September and in the last 24 hours have banned bitcoin futures trading.

Bitcoin futures may be more dangerous than we thought but we’ll explore that in tomorrow’s update before these potentially destructive futures markets hit Wall Street.

Network Status

This week we’ve been talking a lot about blockchain capacity both in Bitcoin and Ethereum. Both blockchains seem to be testing their limits at this moment in time.

The Ethereum network is still being plagued by cats. The overnight sensation of the new viral dApp Crypto-kitties currently accounts for about 20% of the transactions on the network.

Bitcoin on the other hand is becoming a victim of its own success. The number of transactions waiting for confirmation is now at a dangerous high of 136,000.

And the average transaction rate over the last 7 days is now at an all-time high of 4.6 per second.

It’s still possible to speed up transactions on both networks by paying a higher miner fee. However, those paying the regular amount will need to be patient and could experience severe delays.

The good news is, we don’t seem to be at the point where transactions are being rejected on a mass scale. So even though the capacity of the networks and the patience of alternative investors are being tested, we haven’t quite reached any hard limits just yet.

Ethereum founder Vitalik Buterin has been working on the Constantinople upgrade for some time and we hope that it comes through soon. For bitcoin, the problem is a bit messier. The lack of centralized leadership makes it a lot harder for any meaningful solutions. However, some analysts feel that as the SegWit solution is adopted by more miners it should increase the capacity somewhat.

Contrarian Thinking

Many traders like to try and take an opposite view on what’s happening and find the opportunities that may be hiding behind the FOMO.

For example, popular cryptotrader @Liamdavies, who’s made 170% for himself and his 1,437 copiers over the last year, has posted this trading thought on XRP.

For short term traders, finding this type of support line could present an excellent opportunity. To highlight Liam’s point, here’s a chart of XRP from the beginning of the recent boom.

The idea is that an order with a stop loss just under the support line has a lot more to gain if it goes in your favor than it does to lose if it doesn’t. Meaning, if it hits your stop loss, no big deal, it’s a small loss, but if it turns around now, in retrospect it will have been an excellent entry point.

In addition, over the last week the entire market has been dominated by Bitcoin, with BTC taking back a lot of the market share from the other currencies. So, if we do see a pullback in bitcoin for any reason, it may be a good idea to get in on some of the alts.

Let’s have a spectacular day ahead!

This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation.
The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro.

Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose.

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 122 rated postsSenior Market Analyst at Etoro.com.




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Altcoins

Cryptocurrency Market Treads Water in Anticipation of Bitcoin’s Next Breakout

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Cryptocurrencies traded marginally lower on Monday, as bitcoin, the market’s chief bellwether, awaited its next major breakout. According to the technical charts, the bitcoin price is poised to continue higher in the short term, though damaged investor psychology could undermine those efforts.

Market Update

The combined value of all cryptocurrencies in circulation reached $213.3 billion, according to CoinMarketCap. The market is little changed compared with 24 hours ago and is roughly $5 billion lower than the intraday peak.

Trade volumes continued to hover in the $11-$12 billion range after briefly surpassing $16 billion on Saturday.

Most major assets in the top-ten were trading lower, with losses ranging from 1.6% to 3.9%.

Bitcoin traded within a $140 range on Bitfinex, eventually settling at $6,450. BTC is little changed for the day.

The bitcoin price is showing signs of stabilizing after last week’s modest recovery, which saw prices bounced from $5,860 toward $6,600. In doing so, BTC crossed the 50-day moving average and looks poised to test the 200-day MA, based on the four-hour charts.

 At current values, bitcoin accounts for 52.2% of the total cryptocurrency market. Therefore, its next move will have major implications on altcoins and tokens.

Bitcoin ETF Talk

The cryptocurrency market is still reeling from the SEC’s non-decision on a highly touted bitcoin exchange-traded fund. As Hacked reported nearly two weeks ago, the Securities and Exchange Commission delayed its ruling until Sept. 30 in order to weigh thousands of public comments on the matter. For many, the agency’s forthcoming decision could make or break the market – at least, in the short term.

The asset in question is the CBOE-backed VanEck SolidX Bitcoin ETF. According to the application, VanEck and SolidX are proposing a fund backed by physical bitcoin with an insurance component to protect investors against operational risks associated with sourcing and holding the digital asset. Naturally, investors are excited about the fund’s potential and believe it solves many of the SEC’s concerns around safety and price manipulation.

However, the consensus among analysts is that approval is too premature at this stage. For starters, the SEC has yet to fully grasp the implications of a bitcoin ETF. As a matter of fact, the agency only recently deemed bitcoin to be a non-security. According to analysts, the SEC is likely to delay its ruling until next year as the agency investigates the matter further.

Fixation on the ETF narrative ignores the myriad of positive developments concerning crypto custody and the recently announced Bakkt initiative, which aims to bring cryptocurrencies to mainstream investors and consumers.

Bakkt, which was announced last month, is a new startup funded by Intercontinental Exchange (ICE), Microsoft, Starbucks and Boston Consulting Group (BCG), among others.

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 553 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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Altcoins

IOTA, Vechain Lead Tepid Crypto Market Recovery on Sunday

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Digital currencies IOTA and VeChain were among the biggest gainers on Sunday, though a lack of buying interest kept the broader market at a standstill.

IOTA, Vechain Lead Recovery

In terms of percentage gains, IOTA was among the best-performing cryptocurrencies on Sunday. The value of MIOTA sprung up 12.2% to $0.545 on trade volumes of $44.4 million.

IOTA is rebounding from extreme oversold levels after being losing more than 40% of its value during the latest rout in market prices. MIOTA was disproportionately impacted by the recent downturn because of multiple controversies at the Berlin-based IOTA Foundation. As Hacked reported earlier this month, a failed partnership with Sirin Labs and internal divisions at the Foundation have all contributed to the massive drop.

IOTA, which has since dropped to no. 12 on the crypto market cap rankings, has trimmed its seven-day decline to just 1.7%.

Meanwhile, the highly touted VeChain (VET) rose 12.1% to $0.013, regaining much of Saturday’s sharp reversal. The digital currency is also enjoying some momentum after launching its official mainnet in late June. The accompanying token swap on Binance officially produced VeChain Thor (VET), which is the cryptocurrency now quoted by the market.

Although there was no immediate catalyst for the recent upsurge in IOTA and VeChain, both currencies are part of a much larger initiative aimed at monetizing the Internet of Things. In particular, VeChain is benefiting from China’s latest push to speed up development and commercial implementation of blockchain technology. VeChain has developed national level partnerships with various government entities in the world’s second-largest economy.

Broader Market Trades Laterally

Gains in the broader cryptocurrency market were much slower to materialize on Sunday. At the time of writing, the total cryptocurrency market cap was worth $216.6 billion, up just 1.3% over the previous day.

Tepid moves in the broader market were accompanied by a sharp drop in total trading volumes. Market turnover has plummeted by 24% since Saturday, according to CoinMarketCap.

Bitcoin, the world’s largest digital currency by market cap, continues to trade below a key technical resistance. Bitcoin’s lateral moves come despite multiple signs of a bullish reversal over the past few days. As Hacked reported Thursday, the bitcoin price has returned above the 50-day moving average with key measures of relative strength showing stronger upward momentum.

At the time of writing, bitcoin was trading at $6,404 on Bitfinex. The cryptocurrency’s total trade volumes declined to $3.3 billion after spending the better part of a week above the $4 billion mark. The bitcoin price is up 1.7% compared to last week.

Ethereum rose 2.1% on Sunday to $303, trimming its weekly drop to 5.9%. Meanwhile, XRP rose 3.6% on Sunday to $0.342. Compared with last week, the so-called banker’s cryptocurrency has gained 12.8%. At its lowest point, XRP was down 93% from its record high.

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 553 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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Cryptocurrency Rally Stalls as Bitcoin Price Hits Resistance

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Cryptocurrency prices were down across the board on Saturday, with bitcoin – the market’s biggest bellwether – stalling near a key  resistance.

Market Update

After reaching a high of $225.6 billion on Friday, the total cryptocurrency market capitalization has fallen back to $211.3 billion, according to CoinMarketCap. The broad pullback was accompanied by only a minor dip in trading volumes, a sign that profit-taking was a factor.

Six of the top-ten coins (excluding Tether) had reported declines at the start of the weekend. Bitcoin was down 3.5% to trade at $6,355.00 on Bitfinex. The leading digital currency reached a high of $6,619, which is just shy of the most recent peak. Bitcoin’s market still exhibits strong trading volumes, with 24-hour turnover at $4.3 billion.

Among the major altcoins, Ethereum, Stellar Lumens, Litecoin and Cardano had each declined between 1.2% and 3.5%. On the opposite side of the spectrum, XRP, bitcoin cash and EOS had reported gains of at least 1.6%.

Bitcoin’s dominance rate, or the percentage of the total cryptocurrency market cap held in BTC, was 52%. Bitcoin accounted for as much as 54.5% of the total market capitalization earlier this week.

Dollar Factor?

The recent meltdown in cryptocurrencies originated 11 days ago when the U.S. Securities and Exchange Commission (SEC) announced it would delay a ruling on a highly anticipated bitcoin exchange-traded fund (ETF). However, analysts have struggled to explain the extent of the selloff – namely, the $35 billion plunge between Aug. 10-13.

According to eToro analyst and Hacked contributor Mati Greenspan, a surging U.S. dollar may have contributed to the decline. As CCN reports, the cryptocurrency market’s movements this week have been highly correlated with fluctuations in emerging-market currencies. Emerging-market exchange rates have been rocked by contagion fears emanating from Turkey’s political crisis, which have boosted demand for the U.S. dollar. As Hacked reported Friday, the U.S. dollar index recent hit more than one-year highs.

“As the United States moves to tighten its economy and avoid strong inflation, they’re taking action that is strengthening the Dollar. Because the US Dollar is the global reserve currency, many smaller economies rely heavily on a stable exchange rate with the greenback,” Greenspan wrote. “So too, as the Dollar is being seen as a stable store of value at the moment, there really isn’t much incentive for people to store their money in digital assets.”

Bitcoin is generally viewed as a non-correlated asset, which means it enjoys unique price independence when comparted with traditional markets. Correlation, when it does occur, is often driven by the erroneous belief that bitcoin is associated with the broader market. This was observed earlier this year when bitcoin seemingly fell in lockstep with the U.S. stock market.

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 553 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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