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Analysis

Top 10 Cryptocurrencies are Tanking – Prediction of the Bitcoin Price in 2017 and 2018

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The major cryptocurrencies like Bitcoin, Ethereum, Litecoin and Ripple are down by more than one to eight percent today:

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Source: coinmarketcap.com

I want to let you know what I think of the cryptocurrency market we are facing, as I’ve experienced what is happening previously (2014-2015).

Source: coinmarketcap.com

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Cryptocurrencies tend to operate in a triangle, where something sparks interest, media coverage, prices are rising, and everyone is “making money.” One could argue that the latest surge in bitcoin and ethereum price is driven by ICO-enthusiasm. The prices tend to drive sharply upwards until deposits are matched by withdrawals and “take profits”. I believe bitcoin hit that crucial target at $3000 per bitcoin, and I hate to say it, but if history will repeat itself, the bitcoin price, including other cryptocurrencies, might fall by 70 to 80 percent in the coming years (2017 and 2018). The hype seems to be over. ICO-scams are appearing, and you can expect negative media coverage going forward, demanding regulation.

Cryptocurrency investors are impatient, so when they do not see that the price is rising but standing still, they tend to get bored and anxious. This might lead to a selloff which creates more panic in the market, and then prices go down.

I want to prepare our Gold Members of such a scenario. Of course, I might be wrong, that in this case the price will keep rising to 1 million USD per bitcoin (lol), but my gut feeling tells me we are continuing down to at least $1000 per bitcoin within the coming years (let’s hope I’m wrong).

What does this mean for you?

You should not hold more funds in cryptocurrencies than you can afford to lose and still be happy. Do not bet everything on the magical cryptocurrency economy. Put more funds into ordinary assets like Gold, Silver, and even corporate bond funds as I have.

Next week, I’ll let you in on a little investment secret that I believe will be a killer in the coming years. And I’m going to buy more and more shares of the X in order to take a bigger part of X. I’m excited.

Have a good weekend all.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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21 Comments

21 Comments

  1. Roberto

    July 1, 2017 at 2:30 pm

    70 to 80 percent drop. This is an unrealistic article and I can’t believe it actually got published.

    • gullyfoyle

      July 1, 2017 at 3:51 pm

      Have you measured the bear from the last bubble?

      • Roberto

        July 1, 2017 at 4:12 pm

        I just think 70 to 80 percent is unrealistic. Maby 50.to.60. Wouldn’t you agree?

        • gullyfoyle

          July 1, 2017 at 4:27 pm

          I measured it @ approx 65% sometime ago, value lost so I suppose I agree- as 50% retracement is my personal target. I was just surprised by your reaction to the article, it seems entirely plausible.

          • Roberto

            July 1, 2017 at 4:47 pm

            Let’s just hope we are both wrong. Thank you for quick honest response. Have a great day. Any thoughts on max coin?

        • gullyfoyle

          July 1, 2017 at 5:46 pm

          Dunno about maxcoin, unless there is something special about it (AFAIK there is not and it’s a Max Keiser P&D, which he subsequently dumped himself, so I’m guessing there is still a strong or some community behind it) I’d trade it but not hold. Just my opinion, but I know next to nothing about it since 2014.

  2. juliengro

    July 1, 2017 at 2:32 pm

    I believe you are 100 just.!!!
    I party is over until beginning middle 2018

  3. flogy4031

    July 1, 2017 at 2:55 pm

    well, beside trading crypto-coins do not seolve yet any real world problem. So you might be right, but I believe the hype will go on a little longer (3000 USD/BTC is not a vey powerfull psichological level). I think we will se at least one more wave up, though I believe two waves up to the “magic” 10.000 USD/BTC are likely. If by then we can not use coins to actually do something they might take a BIG fall. And who knows, we might see large sacale adoption as currency by that time, or we will se another blockchain becoming dominant and with real world applications (ETH,LSK,maybe XRP)

  4. alphadreams

    July 1, 2017 at 3:17 pm

    Even in Fibonacci pullbacks, 38.2%, 61.8% is standard, but 70.7% and 88.6% are common too. So it can happen with bitcoin too. Cryptos have be regularly pulling back 50% of just their bull runs, so as wild as “70-80” sounds, it is quite possible. This article is just asking people to use care as with any investment portfolio to diversify.

    Gold, for instance, was thought to continue to grow, and it may, but there are always pullbacks. As the asset grows… so too do the corrections. The percentages remain, but the dollar amount increases and you should use care. Especially if 70+ percent puts the price lower than your current average entry into the asset.

    I’ve attached a chart, where gold pulled back after breaking $1000 and was as high as $1035! Everyone was excited, there was still fear in the economy and gold was the safety. Then it pulled back 70% to $688 before a huge rally to $1920 range. It later pulled back 70% again to almost the previous high of $1035. I hope this illustrates how large these moves can be in assets that are not stocks/equities.

    https://www.tradingview.com/chart/XAUUSD/lFXnCM8Z-Gold-70-7-pullback/

  5. cryptopalevu

    July 1, 2017 at 3:19 pm

    Jonas thanks for publishing this. As you know with the exchanges being backlogged for verification and such a new space, it is not so easy to make the conversion from Altcoins to Fiat… strategies on how to do that as well would be welcomed.

  6. cryptopalevu

    July 1, 2017 at 3:44 pm

    Remember: the internet boom reached 3 trillion before crashing hard, and cryptocurrency market is at 100 billion.

    Also, as opposed to the stock market where stocks are sold to fiat, a lot of crypto is *reinvested* into more successful cryptos.

    Having said that, I realize that Bitcoin and Ethereum hold the vast majority of the $$ where as the internet stocks were much more spread out in wealth.

    My effort here is to consider all factors and make the right decision.

  7. visiondream3

    July 1, 2017 at 4:07 pm

    I think during this bull run, many people got in at around $2000, so I think that figure may be a watershed moment. If they are frightened to hold on when the negative news kills bitcoin again, it will be worse.

  8. pradz

    July 1, 2017 at 4:14 pm

    Thanks Jonas,
    For the article. Little bummed out by your views, but as with every problem I’m sure a buying opportunity is around the corner and I’m sure you and the Chartbusters will figure out where.

    “there something strange….

  9. Tommy

    July 1, 2017 at 9:52 pm

    There’s the time to panic and screaming ;P guess all my alt’s just went in for a loong ride now. better just hold, then panic sell at 30% down. idk if they go 90% down, until the day i actually have to sell . (or loose them)

  10. wolfye82

    July 2, 2017 at 8:43 am

    Hi Jonas, all. Interesting point of view and yes also a plausible scenario. One thing that should be taken in consideration is the investments that big companies like Microsoft, IBM, Accenture and also big Banks are making in blockchain technlogy (mostly ETH and XRP driven), investments that were not so common in the past…. So, my feeling is that the drop could be not so dramatic.

  11. Chris G

    July 2, 2017 at 11:12 pm

    Thus far, Mate Cser has been spot on in terms of trading predictions. And this recent bubble is def. reminiscent of the 2014/2015 surge that brought so much attention to BTC. That said, obviously I wish I had held long-term positions in BTC when the price was around $400. The general consensus at this point seems to be 1. hold a long-term position, while 2. profit taking during the bubble. In terms of Ethereum, I’m dug in with about a $20k investment in mining equipment that I view as part of a long-term position. But big thanks to hacked.com and particularly Mate, whose advice has me at +$10k on cryptocurrencies at the moment … only risk what you can lose on this one!

  12. birmas

    July 5, 2017 at 4:39 pm

    I went long on a bunch of alt coins that are currently stored with poloniex. What are your suggestions in a case like mine? Should I withdraw my coins to local wallets or leave them and wait for the bounce? Advice appreciated 🙂

    • eriore

      July 5, 2017 at 7:57 pm

      I would personally advise against leaving crypto you aren’t trading in an exchange. There is always the possibility they can get hacked and someone steal a ton of crypto, only store what you are trading on the exchanges and anything else you would like to hold on a local or hardware wallet.

  13. Mr. Anderson

    July 6, 2017 at 3:32 am

    I strongly doubt this will happen especially in that time span. Perhaps when coin distribution runs out however I still think that is a reach because the price will be far too high by then. This month seems to have the best chance at seeing 1k with the proposals looming however many other positive influences are occurring across the globe simultaneously.

    Bitcoin is just now picking up steam and being regulated into normalcy by many governments. Let’s not forget that blockchain technology is secure by default (on the chain – primary vulns are endpoints and centralized infrastructure and gaps are closing), globally fault tolerant, enabling financial freedom from banks and gov corruption, disabling fraud and so much more. Currency was just the first application to be put on top of blockchain. Most of the FUD being flung is from those who stand to lose their way of life WHEN this becomes mainstream IMHO.

  14. godishere

    August 18, 2017 at 3:15 am

    Lol gut feeling. You’ll miss out big time, the chart says it’s crossing $10,000 by the end of this year. Haha.

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Analysis

Bitcoin’s Record-Breaking Rally Continues as Prices Cross $8,100

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Bitcoin surged to new highs on Sunday, as the world’s largest crypto by market cap continued to generate bids following the cancellation of Segwit2x.

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BTC/USD Price Levels

The value of a single bitcoin reached a daily high of $8,110.59, its best level on record. At press time, BTC/USD was valued at around $8,002 for a gain of 4%.

With the gain, bitcoin’s market cap now exceeds $133 billion. That’s roughly $100 billion greater than Ethereum, the market’s second most valuable cryptocurrency.

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Bitcoin has added more than $1,100 over the past five sessions. It was down around $5,600 just one week ago.

Bitcoin Cash (BCH), a digital currency alternative that broke away from the original blockchain Aug. 1, was down 5.1% at $1,185. BTC and BCH locked horns earlier this month after the Segwit2x hard fork was abandoned.

$10,000 and Beyond?

Institutional clearing platform LedgerX has initiated its first long-term bitcoin futures option, which is set to expire Dec. 28, 2018. In setting up the option, LedgerX is assuming a price of $10,000 at the time of expiration. That’s a 25% premium on current levels.

Investors who buy the option are essentially saying they believe prices will exceed $10,000 by the time of expiration.

Bitcoin is being helped by growing institutional demand for the digital currency, as hedge funds, day traders and other mainstream investment outfits look to access this burgeoning asset class. CBOE and CME Group have each announced plans to integrate bitcoin into more conventional investment vehicles in the coming months.

The rush of institutional money into bitcoin is a sure sign that the digital asset class is becoming too big to ignore. The value of all cryptocurrencies in circulation has already exceeded $230 billion, with more than a dozen coins valued at $1 billion or more. Nine others have a market cap of $500 million or greater.

Coinbase Responds

The rise of institutional capital has also compelled Coinbase to introduce a custodial service targeted at account holders with more than $10 million in assets. This service targets hedge funds and other institutions that have remained largely on the sidelines of the crypto revolution.

In a recent blog post, Coinbase CEO Brian Armstrong announced that the new service will launch sometime next year.

“When we speak with these institutions, they tell us that the number one thing preventing them from getting started is the existence of a digital asset custodian that they can trust to store client funds securely,” Armstrong wrote.

In addition to maintaining the minimum $10 million asset requirement, institutions must pay a $100,000 setup fee to gain access tot he Custodial program. In response, institutional investors will receive assurance that their assets are secure.

The Coinbase Custody website lists broad support for bitcoin, Ethereum (ETH) and Litecoin (LTC), as well as ERC20 tokens. The ERC20 protocol has emerged as the favorite for startups launching initial coin offerings (ICOs), a controversial crowdfunding model that has already overtaken early stage venture capital.

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. 

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Cryptocurrencies

Is Ethereum Ready to Play Catch Up With Bitcoin?

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In mid-June of this year, the difference between the market capitalization of bitcoin and Ethereum had narrowed down to less than $8 billion. This had many market participants excited. They expected Ethereum to dethrone bitcoin as the leader, a move popularly termed as flippening.

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Key observations

  1. Ethereum has hugely underperformed bitcoin
  2. The chart pattern suggests that Ethereum is likely to play catch up in the next few months
  3. Stay on the long side of Ethereum to benefit from the bullish setup

However, fast forward five months and the difference in the market capitalization of the top two cryptocurrencies has increased to about $96 billion. This shows that while bitcoin has raced ahead in the past few months, Ethereum has hugely lagged behind.

However, is the underperformance about to end?

The chart pattern shows that Ethereum is likely to embark on a rally of its own that can carry it to $645 to $670 levels in the next few months. Let’s see how we arrived at these levels.

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Ethereum opened trading at $8.16 on January 1, 2017. It started its rally in March and by June 12, it reached a high of $420, an astronomical rally of about 5047%. Thereafter, it entered a period of consolidation, digesting the gains.

On the charts, Ethereum has formed a large symmetrical triangle, which usually acts as a continuation pattern. The breakout is generally in the direction of the long-term trend, or the trend that was prevailing before the pattern formed. In this case, the sharp move from January to June confirms that the cryptocurrency was in an uptrend before forming the triangle.

However, this is not a fool proof trade because sometimes the symmetrical triangle acts as a reversal pattern. Therefore, the best way to play this trade is to wait for a breakout of the triangle before initiating any trade.

Where can we take an entry?

Currently, the resistance line of the triangle is at about $378 levels, a level close to today’s intraday highs. The bears are likely to strongly defend this level. However, if the bulls breakout of $378 and manage to close above the resistance line, the trade on the long side will set up.

Different traders use different methods to confirm whether the breakout is valid or not. Some wait until price moves 3% above the breakout level, others wait for three consecutive closes above the resistance level.

However, we have observed that the best breakouts never look back, hence, waiting for three days may lead to a missed opportunity. Therefore, we can wait for a closing above the resistance line of the triangle and initiate the long positions on the following day.

The breakout can face resistance at $400 and $420. However, we expect the virtual currency to scale both these resistances and rally towards its pattern target zone of $645 to $670.

Notwithstanding, even the most reliable patterns can fail. Therefore, our stop loss will be kept at $340. We don’t want to hang on to the trade if it falls back into the triangle. We shall raise our stops to breakeven as soon as Ethereum breaks out to new lifetime highs. From thereon, we shall trail the stops higher to protect our paper profits.

Note

The chart pattern suggests a resumption of the long-term uptrend in Ethereum. However, this will not get confirmed until the cryptocurrency breaks out and sustains above $380. Therefore, please initiate positions only on a breakout and close above the triangle. Entering presumptive trades may result in losses.

Featured image courtesy of Shutterstock. 

 

 

 

 

 

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Analysis

Long-Term Cryptocurrency Analysis: Bitcoin Flirts with $8000 as Altcoin Bull Persists

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Bitcoin’s swift recovery was the main topic of the week, as the most valuable coin not just regained its steep losses, but hit a marginal new high towards the end of the period. The entire segment is experiencing capital inflows as the total value of the coins climbed above $230 billion for the first time ever after finally leaving the vicinity of the $200 billion mark.

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BTC breached the $8000 level before turning slightly lower on Friday, but despite the severely overbought daily chart, it is still trading near its all-time highs. As the long-term picture still suggests a deeper correction, investors should wait with opening new positions and traders should also control position sizes here. Key support levels are found at $7700, $7000, and $6700, while the recent key break-out level at $5000 still hasn’t been re-tested.

BTC/USD, Daily Chart Analysis

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Dash is still the most bullish altcoin from a technical standpoint, despite this week’s short-term correction, as the coin is trading above its prior all-time high, and this weekend, it looks ready to test the break-out high near $500. Support levels are still found at $400, $360, and $330, and as the long-term picture is approaching overbought territory, investors should only hold on to their positions here.

DASH/USD, Daily Chart Analysis

The other major altcoins are also mostly in bullish setups, with some of them already in the latter stages of this cycle, like Monero and IOTA, but elsewhere in the segment, there are still opportunities for both traders and investors. Let’s see the detailed long-term view.

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