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Depressed volatility driving bitcoin (BTC) price down?

6:34 am ET, 22 Jun 2018

Bitcoin (BTC.X) is trading at $6,407.53, down -4.79% from yesterday, wiping away the gains from the most recent steady recovery.    What's driving the bitcoin price down and what's the BTC price forecast?

Looking at the technical analysis for the cryptocurrency, we notice some bearish signals for bitcoin:

  • Bitcoin price failed to hold gains and broke a major support at $6,700 against the dollar.
  • MACD is trending down, entering the bearish zone.  MACD (moving average convergence divergence) is a trend-following momentum indicator that shows the relationship between two moving averages of prices.  MACD is calculated by subtracting the 26-day EMA (exponential moving average) from the 12-day EMA;
  • RSI (relative strength indicator) is now in the oversold region.   RSI compares the magnitude of recent gains and losses over a specified time period to measure speed and change of price movements of a security;
  • A new support level is forming is $6,300.

What do the experts say?  Bill Baruch, Blue Line Futures President, told CNBC bitcoin's "bottoming process can begin" following signs that volatility is depressed.  Bitcoin's 30-day volatility is now at 61 percent, and slightly up from its low of 50 percent earlier this month. This volatility is significantly below the annualized volatility seen last year, north of 150 percent.

After bitcoin's volatility has become quite depressed and the cryptocurrency has lost as much as 70 percent from its December peak, it's time for it to find a new bottom.  

It's no secret that the bitcoin price is going to remain unpredictable. There are massive spikes and declines, and nothing is preventing $5,000 from being the bottom.  Bitcoin challenges for 2018 involve regulation and market maturing; with larger sums, crypto is becoming a grown-up game.

However, one reason for optimism is the amount of crypto-financing in 2018 thus far, which is exponentially larger than the amount spent on financing in 2017. 

Over the last 30 days, BTC.X lost -22.54%.

Are hacking issues alone responsible for cryptocurrency price drop today?

8:41 am ET, 11 Jun 2018

The Bitcoin price dropped 7% today.  Ripple, Ethereum and Litecoin have followed suit.  

A closer look into altcoin prices reveals that some other cryptocurrencies have suffered even more--EOS is down 17%, while Tronix is down 12% and Bitcoin Cash declined 10%.

The sharp drop in the price of bitcoin and other virtual currencies is attributed to the hacking of the South Korean cryptocurrency exchange Coinrail, which was compromised over the weekend.

The obvious question is, why did the price of Bitcoin and Ethereum remain relatively more stable than the price of other virtual currencies?

It's important to note that EOS, Tronix and Bitcoin Cash are all more susceptible to panic selling than the mainstream coins.  

Coinrail is a relatively minor cryptocurrency exchange in South Korea, and the volume traded on Coinrail will not impact the price of altcoins dramatically.  However, when a panic attack hits the market, manipulators are going to be most noticeable in those areas where liquidity is lacking.  

Low liquidity is an issue for most altcoins because it allows individual traders to manipulate the price of cryptocurrencies.  What follows next is a wave of panic selling from individuals who don't believe in the long-term opportunity for those altcoins, and are looking to curtail losses by liquidating their positions. 

The current decline in the price of cryptocurrencies is a move perpetrated by market manipulators who can, for all intents and purposes, drive down the price when it's opportunistic for them.

To follow the price and news about cryptocurrencies, please visit Finstead (and type "BTC.X price" or "BTC.X news" to get the latest scoop and information).

Bitcoin, Ethereum, Ripple and EOS: who's winning and who's losing?

2:22 pm ET, 01 Jun 2018

As the crypto market gains more mainstream popularity, one thing is apparent--increasingly more altcoins are gaining in status, relative to the (still) most popular cryptocurrency, Bitcoin

It's a common belief today in the crypto investment world, that Bitcoin is losing dominance--and history of its market cap relative to all other cryptocurrencies shows exactly that.  Also, Ethereum, which was once viewed as the enabler of blockchain-based projects and companies, is slowly losing its supremacy.  

Some insiders, such as Brad Garlinghouse, Ripple CEO, declared that Bitcoin could be on the verge of experiencing a price downfall in the cryptocurrency community as investors are gradually becoming aware of the different currencies and alternatives available to them.

Individual investors are becoming more focused on the mission of crypto companies and currencies (e.g., what problems are they solving?) and also the teams that run them.  

So which coins are gaining in popularity relative to the rest?  And which ones are likely to make it to or stay in the top 5 list (by market cap), if they are not there already?

Two candidates that stand out are EOS and Ripple.

EOS is a well-funded project--over $4B went into it, and now the company is rapidly releasing new features and functionalities. The EOS team is an A-team--and that's a requirement for companies planning to win in the crypto space.

But funds are not everything.  Microsoft has spent billions trying to make Bing relevant and it failed. It’s not about the money but about the way you use resources, says Brad Garlinhouse.  Ripple (XRP) has used its funds very wisely in a way that has created value for their users and coin holders. 

When Bitcoin was initially offered in 2008, it was a game changer. It was the first time people could initiate transactions and trade without having banks or governments behind it.  

But the landscape has changed.  The secret source to winning in the long term is talent investment, focus on execution and long-term vision.  EOS and Ripple seem to have that--and we'll watch closely how they execute.

Bitcoin Cash (BCH.X): price forecast

12:11 am ET, 27 May 2018

Bitcoin Cash (BCH.X) price retracted to November 10, 2017 levels.  It's also 43% down from its May 5 local peak, and a far cry from its December heights of roughly $3,650.  

The much-hyped May 15 fork didn't really create much of a rally.  While Bitcoin Cash is focused on becoming an everyday payments network (that Bitcoin is not well-suited for), investors are reacting to this lofty mission with much skepticism.  

Why did the hard fork matter for BCH investors?  

Let's explain how things work.  A hard fork is a software update to a crypto network that results in the creation of an entirely new blockchain network.  Anyone who holds any amount of a coin that goes through a hard fork is entitled to receive a corresponding amount of the new coin. 

So any cryptocurrency that experiences a hard fork generally tends to see upward price movement in the days and weeks leading up to it.

Now that the fork is water under the bridge, what is the Bitcoin Cash price prediction?

Here are our thoughts.  Bitcoin cash price will remain under pressure, given that it declined below the $1,000 support level.  Looking at the technical indicators, here are the key things to point out:

  • Moving average convergence divergence (MACD ) is mostly negative in the bearish zone.  MACD is a trend-following momentum indicator that shows the relationship between two moving averages of prices. MACD is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA.
  • Relative strength index (RSI) is declining towards the 30 level.
  • Major support level can be found at $950.
  • Major resistance level is at $1,060.

Out thoughts?  Be cautious, since the momentum doesn't look particularly encouraging. 

Bitcoin (BTC.X) price manipulation: does it really matter?

7:02 pm ET, 24 May 2018

Bitcoin (BTC.X) recovered today to a price level above $7,500.  The coin price dropped yesterday because of the criminal probe into whether traders are manipulating the price of Bitcoin and other digital currencies. 

Should this concern impact investors' thought process about investing in Bitcoin?  One thing is certain--in this red-hot market for cryptos, there is a lot of misconduct.  The illegal practices that can influence prices include spoofing or flooding the market with fake orders to trick other traders into buying or selling.

Federal prosecutors are working with the Commodity Futures Trading Commission to identify the cases of spoofing.  

Virtual currencies are susceptible to fraud because of the lack of regulations that govern cryptos (in contrast to those that govern stocks and other assets).  Also, there is a good number of 'cheaters', who create wild price swings that could make it easy to push valuations up or down. 

Should you worry as an investor?  It depends on your investment mentality.  If you're a trader--perhaps this is a time when you want to be careful. 

However, if you're a long-term investor, and believe in the value proposition on Bitcoin, this is just a blip on the radar--HODL may be the right strategy.  

Follow BTC.X on Finstead--just type "BTC.X news" or "BTC.X price" to get the latest Bitcoin information and news.

Bitcoin (BTC.X): why is the price stagnant?

11:01 am ET, 20 May 2018

Bitcoin (BTC.Xhas lost almost 15% of its value since two weeks ago. At the peak around Christmas holidays, it was trading at over $19,000. 

What is happening in the Bitcoin world?  What is the near-term price forecast for Bitcoin? 

Bitcoin investors have been predicting that meteoritic rises will commence any day now. But the price has been hovering in the $8,000-$9,000 range with surprisingly low volumes.

In absence of any significant news, the price has failed to move.  Even bold statements from the cryptocurrency analyst Funstrat completely failed to move the price.  (Fundstrat predicted the price of $36,000 by the end of the year.)

Bitcoin pessimists claim that the cryptocurrency trades much like a commodity. Over the long-term, commodity prices move towards their marginal cost of production.  Since the mining profits for Bitcoin will eventually fall to zero, miners will eventually stop producing, claim people who are pessimistic about Bitcoin.

However, viewing Bitcoin as a commodity is incorrect. Miners provide a service, called transaction verification, that Bitcoin users critically depend on.  So miners are not producers; they are laborers who perform a certain service. 

Our view is, Bitcoin has reached a local equilibrium price.  It will move up or down on some significant news.  For now, it may stay in the $8,000-$9,000  until a 'big event' occurs. 

Follow BTC.X on Finstead--just type "BTC.X news" or "BTC.X price" to get the latest Bitcoin information and news. 

Bitcoin Cash (BCH.X): price analysis and prediction

12:56 pm ET, 12 May 2018

Bitcoin Cash (BCH.X) is widely touted in the cryptocurrency community as an altcoin that can avoid many of the mistakes Bitcoin (BTC.X) made.  

One of the things that went wrong about BTC.X is the centralization of protocol development.  Bitcoin is distributed in many ways, but for quite some time there was only one main core group of developers (a.k.a., Bitcoin Core) on it.

Bitcoin  Cash, on the other hand, is completely decentralized (e.g., nodes, wealth and mining pools).  There are several independent teams of developers along with multiple full node implementations.

The value proposition for Bitcoin Cash is as strong as ever.  

But why is the price going down?  What is the Bitcoin Cash price analysis and prediction?  

At this point, we think that the cryptocurrency may be forming a bottom, which can take anywhere from a few days to a few weeks.  Prices in the $1,000 -$1,200 range should not be a surprise.

The price is likely to remain volatile as the bears and the bulls battle it out to establish their reign. The latest news about the investigation of South Korean exchange Upbit by the country’s Financial Supervisory Commission (FSC) triggered the decline of Bitcoin Cash.  Also, negative statements from the likes of Warren Buffet and Bill Gates also influenced retail investors' opinion about cryptocurrencies.  

We will see a positive price movement for BCH.X when commercial institutions publish their plans to use the cryptocurrency.  Stay on top of the latest developments, and keep checking Finstead for news and price updates (just type "BCH.X news" and "BCH.X" price).

Litecoin (LTC.X): what to expect

11:25 pm ET, 11 May 2018

Litecoin (LTC.X) is down 10% at the time of this writing.  The price struggled to move much above $160.  Litecoin is trading in the $130-140 range now, but still above the March $115 minimum.  

What can you expect from Litecoin? What is the price forecast?  When will be a good time to jump in? 

Here is the bigger picture.  The last 24 hours have not been very favorable for cryptocurrencies.  Many cryptos have lost double-digit in the past 24 hours.  

Some of that can be blamed on the criticism from famous investors and entrepreneurs, such as Warren Buffett, Charlie Munger, and Bill Gates.  Gates even opined that he would short Bitcoin if he could. 

However, looking at the long-term, there are many analysts who believe strongly in a well-cemented future for cryptocurrencies, the technology behind them, and eventually higher prices.

About a year ago, Segwit (or Segregated Witness), a soft fork update was activated after endorsements by Litecoin.  Segwit refers to the implementation of a soft fork change in the transaction format of Bitcoin. This was considered a memorable moment for the Litecoin as well as the Bitcoin community. 

Since then, Litecoin achieved its peak at $358 in December.  

The biggest hope about Litecoin is its commercial viability:  

  • RE/MAX is listed on the Litecoin store as a place where you can buy and sell real estate using LTC.

  • You can buy pet toys, treats, accessories, and more from CryptoPet using LTC.

  •  You can buy tea straight from the people who make it on Tealet with Litecoin.

The falling knife pattern of Litecoin's price is concerning to traders.  For the latest price and news on Litecoin, please check Finstead and search for "LTC.X price" or "LTC.X news".  

Bitcoin (BTC.X): what's dragging the price down?

12:15 am ET, 09 May 2018

Bitcoin (BTC.X) price dropped 4% but is still hovering above 9,000.  What's driving the latest movement in Bitcoin price?

The price decline might have been caused by the negative sentiments of famous investors/entrepreneurs: Warren Buffett and Bill Gates. The billionaires' view of cryptocurrencies has an impact on retail investors.  Buffett has been firmly negative about bitcoin, but he also stated he didn’t understand it and would never hold any asset that he didn't understand thoroughly. 

Gates was quick to comment that he would short bitcoin if he could.

Some market analysts have noticed that bitcoin price is correlated to the stock market.  When money is being poured into the market, as it happened last week, bitcoin price is moving up. 

Analysts are starting to use Dow Jones as a predictor of how bitcoin price will move.  On May 4, when the Dow got a stick save from breaking lots of technical levels, Bitcoin started moving up minutes later.

What is the bitcoin price forecast for the rest of the year?    It varies between 0 and 200K, depending on whom you ask.  The CEO of cryptocurrency research company Brave New Coin, Fran Strajnar, sees improving infrastructure and strong fundamentals as the key reasons behind the potential price hike. 

For the latest news on Bitcoin, visit Finstead and search for "BTC.X price" and "BTC.X news".  

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