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Weekly Forecast: Bitcoin Bulls Left Empty Handed After ICE’s Foray Into Cryptocurrency

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A foray into cryptocurrency by Intercontinental Exchange (ICE), Starbucks and the Boston Consulting Group has failed to translate into gains for the bitcoin price. In fact, the complete opposite has occurred, with BTC now threatening a bearish reversal from last month’s high.

The cryptocurrency market’s performance over the past five days reflects volatility in over-the-counter (OTC) markets, which continues to discount overwhelmingly positive developments in the blockchain arena. (At the time of writing, Hacked published Coinbase Explores Adding Dozens of Altcoins for Custody, XRP Included.)

After putting up a strong battle in the latter half of July, the bulls appear to be once again relinquishing control of the market. This tug-of-war will continue over the next seven days as the major coins struggle to maintain levels of key support.

Bitcoin Market Is Too Volatile

The cryptocurrency market’s sudden reversal last week wasn’t as surprising as it appeared, based on the technical charts. As Hacked reported last week, bitcoin entered overbought territory on July 24 after prices rocketed above $8,500 for the first time in two months. It took the bears multiple attempts to drive the bitcoin price below $8,000 but they eventually succeeded, paving the way for the latest slide into correction territory.

Bitcoin is now approaching bear-market territory, which is defined as a reversal of 20% or more from the most recent high.

Analysts at UBS have weighed in on the bitcoin price and have concluded that the market is simply too volatile to drive mainstream adoption. As per CCN, the Swiss bank said: “Our findings suggest that bitcoin, in its current form, is too unstable and limited to become a viable means of payment for global transactions or a mainstream asset class.”

Negative capital flow has underpinned crypto’s volatility since January, when the market began its historic descent. Market-wide trade volumes were down again on Sunday, with 24-hour turnover amounting to just $11.3 billion. Trade volumes spiked above $20 billion during last month’s rally.

Bearish Breakdown or Bakkt Driven Reversal?

UBS’ analysis hit the airwaves 24 hours before ICE made arguably the biggest splash in crypto this year. Bakkt, the NYSE parent’s new startup that will hold and manage investors’ cryptocurrency, is not only planning to revolutionize bitcoin investments but streamline mainstream adoption of crypto payments.

As the author speculated on Saturday, bitcoin and the broader cryptocurrency market is discounting the Bakkt revelation. As it turns out, this could be a symptom of unusual trading behavior in the OTC market. According to Tabb Group, a U.S.-based research firm, OTC trades account for 70% of the total cryptocurrency market. By comparison, digital currency exchanges process less than 30% of total market transactions.

If Tabb’s research is correct, fundamental news like the Bakkt announcement is more likely to have a short-term impact on exchange trading but play a lesser role in OTC markets.

Bitcoin’s next inflection point is $6,800; a break below this level would put the leading cryptocurrency in bear-market territory.

The Week Ahead

In terms of major market-moving events, the following headlines are expected over the next five days.

Monday

A pair of Eurozone data releases headline a relatively uneventful day for traders. Germany will release its latest report on factory orders for July, while Sentix will unveil the August edition of the Eurozone investor confidence index.

Tuesday

On the policy front, the Reserve Bank of Australia (RBA) will vote on interest rates Tuesday. The benchmark lending rate is forecast to hold steady.

For crypto traders, Coinbase is conducting final testing for Ethereum Classic support on Tuesday.

Wednesday

The Chinese government will release its latest trade figures on Wednesday. According to analysts, Beijing’s dollar-denominated trade surplus likely fell sharply in July.

Thursday

The Chinese government will release its latest batch of inflation figures on Thursday, including consumer and factory-gate prices.

In terms of monetary policy, the Reserve Bank of New Zealand will deliver its latest interest-rate verdict. No change to the bank rate is expected.

Friday

The BlockConscious Summit in Brisbane, Australia will begin on Friday and run through Saturday.  The event, which is sponsored by CoinSpot, Binance and others, will feature over 45 speakers.

In economic data, the U.S. Labor Department will release the consumer price index (CPI) on Friday. The U.K.’s Office for National Statistics will release a batch of economic data, including second-quarter GDP, trade balance and industrial production.

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 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Weekly Forecast: Crypto Markets Show Poise as Bitcoin Dominance Rate Falls Below 51%

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Low volumes and tight trading ranges characterized the cryptocurrency market this weekend, as major assets consolidated after last week’s sharp recovery. XRP was the notable exception, as prices returned above $0.60 on positive news concerning commercialization and political advocacy.

Traditional markets fared better than expected in September – a historically volatile month for stocks – and appear poised to continue their winning streak as Q4 gets underway. Economic data and high-stakes trade negotiations between Canada and the United States could set the tone over the next five days.

Bitcoin’s Return to Stability

Bitcoin was unable to set new highs over the weekend but maintained its bullish bias after a strong breakout on Friday. As Hacked previously reported, bitcoin’s RIG trend lines show strong upside potential in the near term. Although this doesn’t negate the long-term bear market, it suggests that a re-test of $7,000 is possible in the not-too-distant future.

Despite returning to stability in recent days, bitcoin’s dominance rate has fallen to the lowest level in over six weeks. Bitcoin’s dominance, or the coin’s share of the total market cap, currently sits at 51.1% after previously falling below 51%.

The planned launch of Bakkt in November is expected to generate a greater sense of urgency to enter the market on the part of institutional investors. Bakkt, with full support from Intercontinental Exchange, is also raising the bar on regulated crypto exchange services, which is expected to encourage stronger infrastructure development in the space. These are just some of the talking points investors can expect to come across over the next week.

Altcoins Aim Higher

Bitcoin’s declining market share comes on the heels of major breakouts for leading altcoins such as XRP, XLM and BCH. While these assets continue to trade at a fraction of their record highs, they have generated notable gains in recent weeks. In all these cases, high-profile business developments were the main catalysts for growth.

XRP continues to show the biggest potential for upside as prices crossed $0.61 over the weekend. In doing so, XRP once again briefly overtook Ethereum as the second-largest cryptocurrency by market cap.

Among the three altcoins under consideration, bitcoin cash is the most likely to lose its fizzle. The BCH price spiked suddenly last week after Bitmain revealed the details of its forthcoming initial public offering (IPO).

The altcoin rally has helped cryptoassetd recover nearly $40 billion from the most recent bear market around $186 billion. However, at this stage, a durable rally does not appear to be in the cards. For short term traders, this means extra caution should be observed when entering new positions. For long-term holders, the time is still optimal to add to existing positions.

The Week Ahead

Below is a summary of the major market-moving headlines over the next five days.

Monday

The economic calendar features several reports on Monday, including the final batches of Eurozone September manufacturing PMI. The European Commission’s statistical agency will also report on the latest unemployment numbers for August.

In the United States, the Institute for Supply Management (ISM) will report on manufacturing PMI for September. Separately, the Commerce Department will report on August construction spending.

In the world of crypto, Ripple’s Swell conference in San Francisco will begin on Monday and run through Tuesday. According to the official website, Swell “connects the world’s leading experts on policy, payments and technology for the most provocative dialogue in global payments today.”

Tuesday

Stellar, the world’s sixth largest blockchain, is planning to implement a beta version of its new Lightning Network on Tuesday. Stellar’s developers are planning to take the Lightning Network live Dec. 1.

The Reserve Bank of Australia (RBA) will deliver its next policy verdict on Tuesday. The RBA’s trend-setting interest rate is forecast to remain steady at 1.5%.

Wednesday

Global data flows will headline traditional markets on Thursday. IHS Markit will release the final batch of September PMI figures for key European markets.

In North America, payrolls processor ADP will release an advance estimate of private-sector job creation for the month of September. Separately, ISM will report on U.S. non-manufacturing PMI.

Thursday

Data watchers will be keeping close tabs on the U.S. Labor Department’s weekly jobless claims report. The Department of Commerce will also release the latest report on factory orders.

In crypto news, Cardano is planning to update its closely watched roadmap on Thursday. The Global Blockchain Forum in San Francisco is also scheduled to begin on Thursday.

Friday

U.S. nonfarm payrolls will dominate the headlines on Friday. The economy is forecast to have added 188,000 workers to payrolls in September following a gain of 201,000 the month before. Average hourly earnings, a proxy for wage inflation, is projected to rise 3% year-over-year.

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 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Weekly Forecast: Bitcoin’s Dominance Falls to Six-Week Low as Altcoins Lead Retracement

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After a series of false rallies, technical selloffs and downright manipulation, the cryptocurrency market appears to have made a convincing breakthrough. Over the past five days, cryptoassets have added more than $25 billion in value with coins other than bitcoin doing the heavy lifting. For the first time in months, bitcoin’s dominance rate is declining rather than increasing.

XRP has been the market’s biggest x-factor over the past week as investors rallied behind three major developments: the anticipated launch of the Ripple-backed MoneyTap, forthcoming commercialization of xRapid and a newly announced partnership with PNC. Positive sentiment is now spreading throughout the market, with altcoins like Stellar XLM and Cardano ADA emerging as the weekend’s biggest winners.

While the bulls clearly aren’t out of the woods yet, cryptoassets have recovered more than $40 billion in lost market cap since the most recent trough. Time will tell whether crypto psycho is taking up fundamentals again. If the answer is yes, the tide may be slowly turning.

Altcoins Leading the Way

XRP has gained a staggering 104% over the last seven days, offering convincing evidence that the worst of the downtrend is over. While a similar rally this week appears almost inconceivable, altcoins like XLM and ADA are picking up the slack.

Stellar’s native XLM gained 36% last week and on Sunday briefly overtook EOS as the world’s fifth-largest blockchain. Stellar’s recovery began after the company announced it had acquired Chain, a highly-touted blockchain firm that is championing enterprise adoption of distributed ledger technology. A few days later, UNICEF announced it is accepting XLM for donations and Circle, a Goldman Sachs-funded venture, said XLM will be added to its class of investable assets.

Continued growth in the altcoin and token classes is indicative of a turning tide in the cryptocurrency market. As investors recall, the height of the bull market in January was accompanied by a large-scale decoupling of bitcoin and the rest of the market. .

Bitcoin Regains Poise

Despite being outshone by its altcoin peers, bitcoin has also made tangible progress over the past three days. The leading digital currency crossed the 50-day moving average on Friday en route to multi-week highs. A bullish crossover of the 200-day MA is still a ways off, though the momentum charts indicate that a sustained rally is likely.

Bitcoin shot up on Friday after the U.S. Securities and Exchange Commission (SEC) announced it would seek further comment on the closely watched VanEck SolidX Bitcoin Trust. This essentially means that a decision on the ETF could drag on for several months.

The SEC so far has reviewed more than 1,400 comments related to the application but has raised 18 key issues that must be addressed before a decision is reached. Many leading analysts, including Hacked’s own James Waggoner, believe that a decision is unlikely before February.

The Week Ahead

Below is a rundown of this week’s major events from the worlds of crypto and traditional markets.

Monday

The economic calendar features a few potentially market moving events on Monday. The CESifo Group will release its monthly report on German business expectations. In the United States, the Chicago Federal Reserve will release the National Activity Index for August and the Dallas Fed will report on regional manufacturing conditions for the month of September.

In crypto news, High Performance Blockchain (HPB) – the “EOS of China” – will launch its mainnet on Monday.

Tuesday

The Connected World Summit in London will kick off on Tuesday with 2,500 attendees, 200 speakers and 60 exhibitions. The event, which is sponsored by Microsoft, Bosch, Huawei and others, explores themes related to the “smart economy,” of which blockchain technology plays an important role.

In traditional markets, the Bank of Japan (BOJ) will release the minutes of its most recent policy meeting on Tuesday. From a data perspective, reports on U.S. housing costs will make headlines in North American trading.

Wednesday

The Federal Reserve will deliver a policy verdict on Wednesday following its two-day meeting in Washington. Fed officials are widely expected to raise interest rates for the third time this year and could possibly signal for an additional hike in December. The official rate statement will be released at 2:00 p.m. ET. It will be accompanied by a quarterly summary of economic projections covering GDP, unemployment and inflation.

Thursday

The Fed isn’t the only central bank scheduled to deliver a rate verdict this week. The Reserve Bank of New Zealand (RBNZ) is also expected to deliver a monetary policy decision on Thursday.

In economic data, the European Commission’s statistical agency will release a bevy of sentiment indicators on Thursday, including: services, consumer confidence, industrial confidence and economic sentiment. Germany will also release final inflation numbers for the month of September.

The U.S. government is scheduled to deliver final GDP figures for the second quarter. Reports on durable goods orders and the goods trade balance are also on deck.

Friday

The economic calendar features several market-moving events on Friday. Action begins in Asia with the Caixin China manufacturing PMI. From there, investors will react to final Eurozone CPI data as well as revised second-quarter GDP estimates from the United Kingdom.

Meanwhile, the U.S. government will release the closely watched personal incomes and outlays report, which contains the most up-to-date reading of core personal consumption expenditures (PCE). The core PCE index is the Fed’s preferred measure of inflation.

Friday is also the final trading day of the month, which means expiration of CME’s bitcoin futures contract. Trading of the September contract terminates at 4:00 p.m. GMT.

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 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Weekly Forecast: Cryptocurrencies – Stable Recovery or Dead Cat Bounce?

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After a volatile couple of weeks, the cryptocurrency market is showing signs of revival. Bitcoin and Ethereum have been the main catalysts for the recovery, though for entirely different reasons. Bitcoin is regaining its stability – a recently acquired status – while Ethereum appears to have stemmed a massive decline that was driven almost entirely by sentiment. Ethereum’s return from the abyss has been especially noteworthy, with the second-largest coin by market cap pushing toward a key resistance barrier.

That said, the recent recovery only qualifies as a minor counter-trend to the bearishness that has gripped the market since early August. In terms of market capitalization, cryptocurrencies are down a third from the peak of late July. The market is also 16% lower than it was at the beginning of September.

Bitcoin Stabilizes

Bitcoin has returned to a stable trading range over the past week, a sign that the worst of the downtrend had passed. As Hacked reported Saturday, bitcoin’s sharp and sudden reversal earlier this month was likely initiated by a prominent whale liquidating a portion of his holdings. A prominent bitcoin holder had moved 110,000 units of BTC and BCH from multiple wallets prior to the price collapse. It is believed that 14% of that fortune was transferred to Bitfinex and Binance.

Absent any new whale spottings, bitcoin is likely to continue higher this week. BTC has crossed the 50-period moving average, according to the 4-hour chart, and is now testing the $6,600 resistance. Bitcoin must overcome this level to avoid a double-top formation, which is normally viewed as a bearish indicator.

Ethereum Rebounds

The rollercoaster that is Ethereum shifted into higher gear last week, with prices surging 30% from their bear market lows. The developer’s cryptocurrency not only returned above $200, it set its sights on a key technical resistance that could pave the way for bigger short-term rallies.

Since peaking around $227, ether’s price has returned to the $220 region. The first major resistance test is located at $235, followed by a stronger barrier near $260.

Concern over scalability, economic abstraction and the long-awaited ICO extinction event have all curbed appetite for ether in recent weeks. Vitalik Buterin, Ethereum’s co-founder, has also indicated that cryptos have likely neared their ‘ceiling‘ in terms of growth. Ether co-founder Joseph Lubin recently countered Buterin’s assertion by claiming that we are only at the start of an exponential growth curve.

The Week Ahead

The following is a high-level review of this week’s major major market-moving events.

Monday

The Block Seoul Global Crypto Investor Summit formally begins on Monday, attracting 1,500 people and 500 media outlets from around the world. Wikipedia founder Jimmy Wales and former CIA director Michael Hayden are scheduled to speak.

Digital currency Tezos will launch its long-awaited mainnet on Monday. The $1 billion blockchain has catapulted into the top-30 cryptocurrencies by market cap, partly in anticipation of the mainnet launch.

BitRewards, the first blockchain-based loyalty platform, will roll out support for Amazon on Monday.

Tuesday

The people behind Lisk will hold a live “Ask Me Anything” session on Reddit between 4-6 p.m. CEST. Meanwhile, the University Congress Center in Istanbul, Turkey will host a blockchain competition involving Binance Coin, Stellar and five others.

Wednesday

In cryptocurrencies, the expiration of the CBOE XBT bitcoin futures contract will occur on Wednesday. Waves’ CEO Sasha Ivanov will also hold a Q&A session on smart contracts, which could get picked up by crypto media sources.

In traditional markets, European Central Bank (ECB) President Mario Draghi will hold a speech at 13:00 GMT. Central-bank speakers are closely watched by investors for clues about future monetary policy.

Thursday

In the blockchain world, BitRewards will suport BIT token payments Shopify and WordPress beginning on Thursday.

On the policy front, the Swiss National Bank is expected to deliver an interest rate verdict. No change in monetary policy is expected at this time.

Data watchers will be keeping close tabs on U.K. retail sales and U.S. existing home sales.

Friday

The BitShares Blockchain Foundation will host BitFest Amsterdam on Friday, a three-day event that brings community members together.

On the data front, IHS Markit will release a pair of PMI reports covering U.S. service and manufacturing industries. The Composite purchasing managers’ index will give a holistic account of the broader economy.

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 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

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