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Week in Review

Week in Review: Have We Reached Crypto Bottom?

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The search for an elusive ‘crypto bottom’ may have finally come to an end this week. Between Sunday and Thursday, the combined market cap of all cryptocurrencies witnessed a peak-to-trough swing of $27 billion in favor of the bulls, with bitcoin and the major altcoins engineering double-digit rallies. The recovery engine lost steam on Friday, putting coin values on track for a weekly loss of around $10 billion.

In traditional markets, U.S. stocks staged a large relief rally this week as investors turned optimistic about the prospect of a new trade agreement between the United States and China. Oil prices notched fresh yearly lows as oversupply concerns continued to weigh.

Cryptocurrencies Bounce

Cryptoassets recovered as much as $27 billion in lost market cap this week, as bitcoin and the broader altcoin universe staged double-digit rallies across the board. The market peaked at $142 billion on Thursday after setting a new 14-month low of $115 billion over the weekend.

Bitcoin rose more than $1,000 peak-to-trough, as the leading digital currency broke through $4,500 during the height of the recovery. A technical selloff on Friday drove price back toward the $4,000 support level, where it now resides.

Tron was among the top performers this week, registering a peak-to-trough gain of more than 55%. Despite falling out of the top-ten, TRX has been aided by positive fundamental drivers and a bullish Justin Sun, who recently advised market participants to check back on prices in two years’ time.

Interestingly, TRX was one of a small handful of cryptocurrencies to report a gain over the seven-day cycle. Compared to last Friday, TRX is up 4%. By comparison, bitcoin is down more than 6% and XRP 12% over that stretch.

Bitcoin SV Cracks Top-10

The bitcoin cash hard fork of Nov. 15 created a permanent split in the BCH community, resulting in a new coin entering circulation. Bitcoin cash ABC, which was widely regarded as the primary implementation of the upgrade before the fork, retained the BCH symbol after winning the hash war against the rival SV chain.

Bitcoin SV entered circulation as the no. 9 cryptocurrency by market cap, overtaking the likes of Cardano, Monero and Tron. SV was the only cryptocurrency in the top-ten to avoid the market correction on Friday. Prices were last seen trading steady just north of $94.

The hard fork had a devastating impact on the cryptocurrency market. It not only diverted hash power away from mining bitcoin, but undermined investor sentiment. Calvin Ayre, one of the primary backers of bitcoin SV, offered a peaceful resolution to the hash war last week by urging both sides to abandon the BCH moniker. In his view, bitcoin cash no longer exists and has instead been replaced by two new cryptocurrencies.

Stocks Recover, Oil Slides

U.S. stocks staged a large relief rally this week, as investors turned their attention to a high-profile G20 summit in Buenos Aires on Friday. A planned meeting between U.S. President Donald Trump and Chinese counterpart Xi Jinping will be the highlight of the conference as both sides look to resolve a bitter trade dispute. The Dow Jones Industrial Average surged more than 600 points on Wednesday, returning to positive territory for the year.

The rout in oil prices intensified this week, as U.S. futures fell below $50 a barrel for the first time in over a year. Prices were down again on Friday as investors continued to doubt OPEC’s ability to drain the market from excess supply. The 15-nation oil cartel will meet in Vienna, Austria Dec. 6 to set new production limits.

The Week Ahead

Cryptocurrencies like bitcoin, XRP and Ethereum remain firmly entrenched in bear-market territory, and this reality is unlikely to change in the near future. The main question is whether the bottoming process has been completed or whether a new round of fresh lows can be expected. The resolution of the bitcoin cash hard fork is promising from the perspective of the bulls; however, a fractured community is likely

Economic data are also on the docket next week, culminating in the keenly awaited U.S. nonfarm payrolls report on Friday. The U.S. labor market remains on solid footing, though weekly jobless claims have risen in consecutive weeks, signaling the potential for a slowdown in the months ahead.

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 738 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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Week in Review

Weekly Recap: Crypto Winter Grows Colder; Trump Goes Prime-Time

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Weeks of steady progress in the cryptocurrency market unraveled on Thursday, as bitcoin headed for its worst drop since November. Bitcoin’s quick and sudden collapse triggered a market-wide correction, with the likes of Ethereum, bitcoin cash and Litecoin heading for double-digit declines.

Stock markets traded in the opposite direction of cryptocurrencies thanks to renewed optimism that the United States and China will reach a new trade agreement. Both sides met for longer than expected this week, highlighting progress on a number of important issues.

Crypto Markets Crumble

The cryptocurrency market experienced a sharp and sudden pullback on Thursday after bitcoin plunged 5% in less than an hour. The leading digital currency continues to exert a gravitational pull on the broader market, which exposed assets like Ethereum, XRP, bitcoin cash and others to heavy selling pressure.

Prior to the selloff, bitcoin had successfully regained $4,000, leading the broader crypto market cap north of $138 billion. It has since fallen to $123.5 billion. There was no immediate catalyst for the drop, which likely means technical trading was the biggest factor.

Most major assets are headed for weekly losses, with Ethereum and bitcoin cash experiencing the biggest percentage drop. Tron is still on track for a weekly gain of around 26% after prices peaked at five-month highs earlier in the week. Read: Tron Surges to Five-Month High as BitTorrent Token Enters Circulation.

Ethereum Hard Fork

After nearly doubling in price over a three-week stretch, Ethereum dropped more than 14% on Thursday. As a result, ether dropped back to third spot in the crypto market ranking, with XRP returning to no. 2.

After Doubling in Price, Ethereum Faces Inevitable Correction Ahead of Big Upgrade

Ethereum had enjoyed strong momentum ahead of a highly-anticipated technical upgrade. Constantinople is scheduled to go live between Jan. 14-18, and will bring much needed upgrades to the network. The hard fork created a sense of urgency for investors and miners, who will see their block reward lowered to 2 ETH from the current rate of 3 ETH. The upgrade will be hardly noticeable to average users but is considered an essential component of the development road map, including future improvements to scalability.

Stock Recovery Deepens

U.S. stocks rose sharply this week, with the major indexes building on a recovery that began in earnest on Boxing Day. The S&P 500 Index is in the midst of its strongest two-week stretch since 2011, having rebounded 10% over that period.

Markets were propelled higher last Friday by better than expected nonfarm payrolls numbers. This week, positive developments around U.S.-China trade negotiations were among the biggest catalysts. Trade delegates from both countries met in Beijing this week, where they ironed out important details concerning U.S. commodity purchases and access to mainland China markets.

Investors are gearing up for a potentially volatile earnings season now that Apple has lowered its guidance on Q4 sales. Corporate reporting season will begin later this month.

Trump Goes Prime-Time

President Donald Trump delivered his first Oval Office address on Tuesday, where he urged Americans to support his fight for increased border protection. The president described the situation on the U.S.-Mexico border as a “humanitarian crisis” that needs to be resolved immediately. Read: President Trump Makes His Case for a Border Wall as Economy Hangs in the Balance.

Trump and congressional Democrats remain locked in a bitter dispute over a proposed border wall that will cost $6 billion. Democrats’ refusal to approve the funding has blocked a new budget from being formed and caused several government agencies to shut down. As many as 800,000 federal workers lost their first full paycheck on Friday as the impasse continued.

The latest talks between Trump and Democrats broke down on Wednesday after House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer said they would refuse to grant wall funding even if government reopened.

The Week Ahead

The longest government shutdown in U.S. history will certainly have ramifications on Wall Street unless Democrats and Republicans are able to reach a solution shortly. There’s already signs that the federal shutdown is starting to make investors anxious, which could put additional pressure on the Trump administration to reach a compromise.

In cryptocurrencies, bitcoin will look to defend a critical support level over the weekend. Its ability to hold $3,500 could dictate whether the market enters full-blown capitulation mode or recovery. The hard fork of Ethereum will also be of interest to crypto traders looking to evaluate ether’s technical progress.

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 738 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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Week in Review

Weekly Recap: Crypto New Year Begins Quietly as Apple Roils Traditional Markets

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Crypto markets opened 2019 on a soft note, as bitcoin and the major altcoins saw more stable trading ranges following weeks of volatility. Ethereum emerged as the week’s biggest gainer following a 16% surge in price, which allowed it to reclaim the second spot from XRP in the market-cap ranking.

In traditional markets, Apple’s admission that it may have a big China problem wreaked havoc on stock prices, with the Dow Jones Industrial Average plunging more than 600 points in a single day of trade. Stocks remain highly vulnerable to extreme swings, a trend that is expected to continue for the duration of the first quarter.

Cryptos Stabilize

The cryptocurrency market showed greater upside potential this week, as bitcoin clawed back above $4,000 on multiple occasions and Tron showed signs of a bullish breakout. However, on balance, the market is little changed compared with last week. Since peaking near $136 billion on Wednesday, the cryptocurrency market capitalization has drifted back below $130 billion.

Further reading: Projects Like Tron are “Just Garbage,” Says Jed McCaleb; TRX Price Ticks Higher on New Year’s Day.

Bitcoin is once again benefiting from positive sentiment tied to Intercontinental Exchange’s forthcoming BTC futures market. Unlike CBOE and CME, the Bakkt trading platform will offer physically settled bitcoin futures, a move that many in the blockchain community believe could boost institutional adoption of digital assets.

Bitcoin on Track for Narrow Weekly Gain as Outlook Brightens; Breakout Imminent?

Bitcoin is currently trading slightly above $3,800 and is down less than 1% for the week. Percentage-wise, bitcoin SV (BSV) was the worst performer among the majors this week, falling 4%.

Ethereum Pulls Ahead

Ethereum pulled ahead of the pack this week, climbing 16% to overtake XRP for second spot in the market-cap rankings. XRP, which fell nearly 3% this week, held the no. 2 spot for the better part of six weeks.

At the time of writing, ether’s price was valued just above $150 for a total market value of $15.5 billion. The so-called developer’s cryptocurrency peaked near $16.3 billion on Wednesday as the price approached $160.

For the first time in months, Ethereum is benefiting from positive news flow ahead of the highly anticipated Constantinople upgrade. The soft fork, which is scheduled to take place Jan. 16, will introduce much needed upgrades to the protocol. It will also lower the block reward for mining ETH, thereby boosting demand for the digital currency. Read more: Ethereum Flips XRP for Second Spot in Crypto Market Ranking Following 12% Gain.

Apple’s Ominous Warning

Apple has finally admitted that it might have a big China problem. On Wednesday, CEO Tim Cook issued a letter to investors warning of an unexpected downturn in revenue for the holiday quarter. It was the iPhone maker’s first revenue cut in 15 years and couldn’t come at a worse time.

The company already faces an uphill battle in an overly saturated Chinese market where low-cost handhelds are taking away market share. As we pointed out on CCN, global smartphone sales likely fell in 2018 and while growth is expected to pick up, it won’t be more than single digits.

Apple’s stock price tanked nearly 10% on Thursday, dragging the company’s market cap below $700 billion. The company’s value peaked north of $1 trillion last year. The selloff in AAPL shares had a noticeable impact on Wall Street, dragging the Dow Jones Industrial Average lower by 660 points. Markets recovered sharply on Friday and are on track for a solid weekly gain.

The Week Ahead

Crypto markets are still in a long-term downtrend, but optimism about the future is quietly growing after bitcoin celebrated the ten-year anniversary of its Genesis Block. Although technical trading continues to dominate prices, a shift to fundamentals is likely in the coming weeks as investors prepare for the launch of Bakkt, the first physically-settled bitcoin futures market.

In terms of traditional assets, the fallout from Apple’s announcement will continue to resonate next week as FAANG stocks continue to struggle. A resolution to the partial U.S. government shutdown, now in its second week, will also be in focus.

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 738 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

GBP/USD Price Forecast: Brexit Has a “50-50” chance – Top UK Cabinet Minister

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  • UK International Trade Secretary, Liam Fox, says that Brexit has a “50-50” chance.
  • GBP/USD remains vulnerable to downside risks, given the lack of political progress.

UK Brexit worries remain at elevated levels, while the British ministers continue to enjoy their ‘Christmas recess’. Unfortunately, the talk of the UK EU Membership referendum, is very much going to be carried well into a third year.

Brexit Has a “50-50” Chance

In terms of the latest commentary, the international trade secretary, Liam Fox, suggested that Brexit now has a “50-50” chance. The possibility that the UK will not be leaving the EU on 29 March, should the MPs reject Theresa May’s Brexit deal.

UK members of parliament will be due to vote on the Prime Minister’s withdrawal agreement in January. The deadline of UK scheduled to leave the EU on 29 March is drawing ever closer, while being very much up in the air.

This vote was initially scheduled for 11th December, however a big loss of confidence for Theresa May as she was forced to make a decision and postpone it. She did this as it became clear there was going to be defeat at quite a large margin.

The Labour Party leader, Jeremy Corbyn, continues to pile on the pressure, urging Mrs May to cut short MPs’ Christmas break. He is calling for this to allow for an earlier vote, as they are not due back in the Commons until 7th January.

Technical Review GBP/USD

GBP/USD daily chart. Price action has been stuck within a 1 cent range, 1.26-1.27. It remains vulnerable to downside risks.

Over the last two weeks, there has been little in terms of major price movement for GBP/USD. This not being surprising of course, given the festive period and market closures. Volumes are expected to gradually pick up this week, from 2nd January, as market participants return from their holidays. In terms of real full swing, this may not be anticipated until the second week of January.

GBP/USD has been moving within a tight range of 1.26-1.27 price range. Given there will be much uncertainty heading into the UK ministers return and the vote, it wouldn’t be surprising to see GBP on the back foot. As seen in the back end of this year, GBP is extremely sensitive to any Brexit updates.

Breakout and Retest of Rising Wedge

GBP/USD 4-hour chart. Price action has broken out and retested a rising wedge pattern.

Aside from the bearish fundamentals, via the 4-hour chart view, GBP/USD had been moving within a rising wedge pattern. The formation of this began on 11th December, to then be breached by the bears on 26th December. A retest of that pattern was seen on 28th December, with the lower trend line rejecting a break back through.

Should the bears capitalize on the above-detailed, then a retest of the December low area may be seen. This can be observed sub-1.25, the low printed on 11th December, down at 1.2480. A breach of this could be very punishing, potentially inviting a free-fall. The direction however will be helped on from the latest developments on Brexit, for now they remain bearish.

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 107 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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