Market Commentary



One week has passed and pretty much hasn’t changed with our somehow conservative readings standing up. $6,800 resisted once again which confirmed our early suspicions on the weak setup for bulls. Not everything has failed as the making of consecutive higher lows is seen as a positive achievement of the market. At least it can provide another safety pillow in some investors’ levels for stop-losses.

Bitcoin dominance is now in a downward trend. After reaching a local high of 57.96% on the 12th of September, it has retracted steadily over the weeks and, at press time, it stands on the 50.94% mark. We have to go back until the 11th of August to see a historical dominance mark below 50%. Ethereum (ETH) and Ripple (XRP) hold a share of 10.72% and 10.76% of the market, respectively, with Bitcoin Cash (BCH) and Litecoin (LTC) being the remaining coins with a share of over one percent. Non-top-10 coins compose, at this moment, 18.64% of the total market capitalization.

The highlight of the week goes to Bitcoin Gold (BTG) with gains of 15.9%, now trading at $26.15. Ripple (XRP) still exhibits profits after the abnormal positive performance of the previous week and is now aiming to reach $0.61. Bitcoin Cash (BCH) with almost 10% weekly gains and trading at $540.7 deserves also a share of the spotlights. In the bottom line of the performance spectrum, Tezos (XTZ) was the only coin with a market capitalization above $250 Mn that achieved a double-figure loss during the week, now trading at $1.48. DASH (DASH), Stellar (XLM), IOTA (MIOTA) and Monero (XMR) had also a disappointing week, but we must take into account the previous recovery figures to establish here, perhaps, a period of profit-taking for some investors and speculators.

 


Latest News


 

EU Markets Regulator Extends Restrictions on Selling Crypto-Based Derivatives. The European Securities and Markets Authority (ESMA) has decided to extend its restrictions on contracts for differences (CFDs), including crypto-based ones. The agency has announced its decision in an official release published Friday, September 28. Before the first restrictions were imposed by ESMA, the leverage limit for cryptocurrency CFDs was at 5:1. But since August it is fixed at 2:1, which implies that crypto investors must possess at least half of a contract’s specified volume upon opening it.

Swiss Startup Raises $103 Million to Launch Cryptocurrency Bank. Switzerland-based startup SEBA Crypto AG has raised 100 million Swiss francs ($103 million) to set up a bank offering cryptocurrency-related services, Reuters reported September 26. SEBA is reportedly headed by former UBS bankers — Guido Buehler as chief executive and Andreas Amschwand as chairman — and plans to apply for a banking and securities dealer license from Swiss financial market regulator FINMA. A license would allow the firm to conduct crypto trading and investments business for other banks and qualified investors.

Italy to Enter European Blockchain Partnership, Local MP Confirms. Italy is about to enter the European Blockchain Partnership, according to the country’s Member of Parliament (MP) Mirella Liuzzi, as cited. According to Liuzzi, the partnership — a collaboration of 26 EU countries — will be signed by the Minister of Economic Development, Labour and Social Policies Luigi Di Maio on September 28 in Brussels. In an interview with Key4biz, Liuzzi added: “Joining the partnership will allow Italy […] to define its own line in the development of [blockchain] technology — a practice which the previous government had never implemented”.

Mongolia: Central Bank Gives Permission to Issue First Digital Currency. Mongolia’s largest mobile telecoms operator has become the country’s first licensed entity to issue its own digital currency. This is according to a report by the official state media outlet Montsame Friday, September 28. Mobicom’s financial arm Mobifinance is now clear to issue the e-currency, dubbed “Candy,” to investors, Montsame confirms. The executives have received formal permission at a ceremonial event at the Bank of Mongolia’s headquarters Friday.

Ukrainian National Bank Considering Launching State Digital Currency Tied to Local Fiat. The National Bank of Ukraine (NBU) is considering launching a state-owned digital currency based on blockchain, local news outlet Vesti Ukraine reported Tuesday, September 25. NBU says that the blockchain-based hryvnia, or e-hryvnia, has to be centralized and remain under government control, Vesti Ukraine writes. The state-backed coin is expected to increase the rate of non-cash payments, along with reducing their cost.

South Korean Government to Exclude Sale, Brokerage of Digital Assets from Venture Business. South Korean cabinet ministers have agreed to exclude digital assets trading companies from venture business classification, Business Korea reported September 27. Back in August, the country’s Ministry of Small and Medium-sized Enterprises (SMEs) and Startups (MSS) had already excluded cryptocurrency exchanges from legislation governing venture businesses (reported).

Goldman Sachs Leads $25 Million Funding Round for Blockchain Payments Startup Veem. U.S.-based banking giant Goldman Sachs has led a $25 million strategic funding round for blockchain payments startup Veem, with participation also confirmed to Cointelegraph from Silicon Valley Bank on September 27. Veem, which utilizes digital ledger technology to increase the efficiency of small business payments, noted in their press release that the funding round also received participation from GV (formerly Google Ventures), Trend Forward Capital, Extol Capital, Kleiner Perkins, and Pantera Capital, among others investors.

Austria to Use Ethereum Public Blockchain to Issue $1.35 Bln in Government Bonds. Austria’s government is set to use the Ethereum (ETH) public blockchain to issue €1.15 billion ($1.35 billion) of government bonds in an auction next week, local news outlet Kleine Zeitung reports September 25. Oesterreichische Kontrollbank (OeKB) — one of Austria’s biggest banks with $26 billion in assets in 2017 — will reportedly operate the live blockchain notarization service. During the auction, scheduled for October 2, the bank will issue the bonds on behalf of the Austrian Treasury (OeBFA).

Swiss Startup Raises $103 Million to Launch Cryptocurrency Bank. Switzerland-based startup SEBA Crypto AG has raised 100 million Swiss francs ($103 million) to set up a bank offering cryptocurrency-related services, Reuters reported September 26. SEBA is reportedly headed by former UBS bankers — Guido Buehler as chief executive and Andreas Amschwand as chairman — and plans to apply for a banking and securities dealer license from Swiss financial market regulator FINMA. A license would allow the firm to conduct crypto trading and investments business for other banks and qualified investors.

Major Indian Bitcoin Exchange Zebpay Shuts Down Due to Banking Freeze. Zebpay, one of India’s biggest cryptocurrency exchanges, has announced the shuttering of all exchange services on Friday following the central bank’s banking ban on the crypto industry. Launch in 2015, Zebpay started trading with an app-only service that quickly became one of India’s most-downloaded bitcoin wallet and exchange apps. On its website, Zebpay indicates it has 3 million users using its iOS and Android apps, with support for 20 cryptocurrencies and 22 trading pairs. The move is a direct consequence of a crippling policy introduced by the Reserve Bank of India (RBI), India’s central bank, to force all regulated financial institutions – including banks – from offering services to the domestic cryptocurrency industry.

India’s National Stock Exchange Trials Blockchain E-Voting for Listed Companies. The National Stock Exchange of India (NSE) is testing a blockchain platform developed by Elemential Labs to conduct e-voting for listed companies, local news outlet Hindu BusinessLine reports September 27. The NSE’s pilot will entail tokenizing voting rights and using the blockchain platform to connect the firm, registrar and transfer agents (RTA), and the regulator. Hindu BusinessLine notes that tokenized votes are both easy to transfer and to proxy, and the test will reportedly be used to evaluate how easy it is to audit the entirety of the voting procedure using blockchain.

 


Crypto Weekly Charts


Total Market Capitalization

Top 20 by Market Cap

Bitcoin Volume / Exchange

Top 20 by Volume – 1d, 7d, 30d

Percentage of Total Market Capitalization – Dominance

 


Bitcoin Market Overview & Forecast

Bitcoin price is approaching a critical level and the stabilization period will soon be over. In crypto-markets, the cycle between volatile periods and stable periods is almost as certain as SEC rejecting the next ETF request. The abnormal drop in volume may, once again, be an early signal of that upcoming turbulent period. Also, this range is now becoming too “overcrowded” in the sense that investors are starting to revisit the same quotes at a faster pace than usual and gaps in some fixed time periods are starting to arise. Obviously that this wears down the market conditions and that a shake in the price action is required to appeal market participants to be more active.

Comparing with last week structure not much as changed in the daily charts for Bitcoin. Overall, several resistance indicators are developing around the $6,800 but, to the downside, we are also starting to draw some supporting lines: 50-SMA and 78.6% retracement. Below that, $6,200 and $6,000 stand for the backup plan of several speculators. On the way up, $7,000 always acts as a psychological threshold and $7,400 is the most recent local high to reach.

[switch between the Market / Forecast section below]

Market Overview

The Week in Numbers

We start this week’s analysis by looking at the 4-hour chart of Bitcoin, as provided by Bitfinex.

Bitcoin price has been enclosed in a bounded trading range for several weeks now. In fact, since the major correction that hit the markets in the 5th of September, BTC/USD has been negotiating in the $6,150-$6,800 trading range. Lately, the lower bound of it has been slightly increasing with time and, during the past week, established the limits of price action to be between $6,350 and $6,800.

Last Sunday saw the first attempt onto the $6,800 resistance but the lack of volume was already weakening prematurely that movement. Eventually, bears took the lead and brought prices back 200 points, to close near the $6,600 mark. Tuesday was a continuation of that correction and price reached as low as $6,328 before entering a reversal period which established $6,400 as the soft limit of action. Wiggling around it, it was only on Thursday that price escalated yet another 200 points, culminating in Friday’s attempt on the $6,800 level.

Effectively, that level was momentarily pierced but bears once again countered the movement – now with increasing figures in volume. The drawdown was less deep, and a rebound on $6,450 placed us in a more tight trading range during the week, with volume fading out as usual when we start revisiting the same levels over and over again. As we write this report, BTC/USD is trading at near $6,640, in the Bitfinex exchange.

Market Capitalization and Dominance

Bitcoin dominance is now in a downward trend. After reaching a local high of 57.96% on the 12th of September, it has retracted steadily over the weeks and, at press time, it stands on the 50.94% mark. We have to go back until the 11th of August to see a historical dominance mark below 50%. Ethereum (ETH) and Ripple (XRP) hold a share of 10.72% and 10.76% of the market, respectively, with Bitcoin Cash (BCH) and Litecoin (LTC) being the remaining coins with a share of over one percent. Non-top-10 coins compose, at this moment, 18.64% of the total market capitalization.

Last weekend, global market capitalization stood around $225.4 Bn and, as we write this report, the same metric figure stands at $225,6 Bn; only a tiny variation over a 7-day period of time.

Best and Worst Weekly Performers

Last weekend, our weekly chart of the top major altcoins traced out a scenario of recovery, in the sense that almost every ticker was green with moderate to high weekly gains. In contrast, this week’s chart is exhibiting a mixed panorama, which illustrates pictorially the uncertainty that hovers in the air, to which side of the balance will BTC/USD tilt in the upcoming days.

The highlight of the week goes to Bitcoin Gold (BTG) with gains of 15.9%, now trading at $26.15. Ripple (XRP) still exhibits profits after the abnormal positive performance of the previous week and is now aiming to reach $0.61. Bitcoin Cash (BCH) with almost 10% weekly gains and trading at $540.7 deserves also a share of the spotlights.

In the bottom line of the performance spectrum, Tezos (XTZ) was the only coin with a market capitalization above $250 Mn that achieved a double-figure loss during the week, now trading at $1.48. DASH (DASH), Stellar (XLM), IOTA (MIOTA) and Monero (XMR) had also a disappointing week, but we must take into account the previous recovery figures to establish here, perhaps, a period of profit-taking for some investors and speculators.

Tezos (XTZ) performance made the exclusive club of coins with over $1 Bn in market capitalization to fall again in number, with Ethereum Classic (ETC) placing the last place (14th) of that rank. NEM (XEM) and VeChain (VET) still in a wide margin to that number, followed closely by Dogecoin (DOGE).

Market Forecast

Last week we forecasted a stabilization of the market, with the range $6,000-$6,200 acting as a solid support. Confirmed. Also, we added the impression that BTC/USD had some margin to recover, yet not its full extent – with the caveat that we would need to do it step-by-step. Also confirmed. Finally, we mentioned that the price action looked a bit fragile – not yet consolidated -, and that a bullish run would probably hit the wall again. This still needs to be confirmed, but our analyses point down to additional difficulties in the bulls’ aspirations.

Don’t think that we got the numbers wrong. This last sentence was taken from the previous week’s report, so the numbers reflected there are relative to the week before. Also, in our analysis of the last weekend, we added to the equation the volume factor: “the volume is showing symptomatical symptoms and fading out”. Finally, we were also slightly positive-biased by the prominent role that the $6,000-6,200 range has been taking in the support of the price action and the ability of the market to pierce that first line of resistance.

One week has passed and pretty much hasn’t changed with our somehow conservative readings standing up. $6,800 resisted once again which confirmed our early suspicions on the weak setup for bulls. Not everything has failed as the making of consecutive higher lows is seen as a positive achievement of the market. At least it can provide another safety pillow in some investors’ levels for stop-losses.

[…] the remaining content of the forecast section discloses several market strategies and can only be viewed by subscribers. Subscribe the “Pro” plan to have full access. Follow our daily updates through our SLACK Investors club.

Join our investor club


Bitcoin Technical Analysis & Trade Ideas


[switch between the Technical / Trade section below]

Technical analysis

As usual, we start this section by looking at the daily chart for the BTC/USD prices, as provided by Bitfinex.

Market Trends & Structure

As stated in the introductory section, week’s performance was of a sideways movement with price action being enclosed in a tighter (as time passes by) trading range. $6,350-$6,800 sets the limits of that channel. Ichimoku’s cloud lower edge is still acting, with a safe margin of distance, as a resistance level and, to bulls, the close proximity to the downward trending line is a matter of worry, unless a breakout is on their plans.

Bollinger bands are narrowing at a fast pace as a result of the lateral behavior of the market and contained volatility. 200-EMA is also converging to 200-SMA, although both are bearish in their slope and dropping below $7,300-$7,400 area. Faster moving averages are wiggling and 50-SMA has turned bullish, narrowing down in distance to 50-EMA. Ichimoku cloud bearish above and ahead of the market with lagging span approaching the Kumo but still 400 points away, at least.

$6,000-6,200 range performed its role accordingly and sustained a favorable evolution of prices. The last attempt by bears was quickly countered and ignited a price escalation, although in a phased manner. Price action is now approaching the Ichimoku’s cloud and the downward trend lines projected from several months ago. Also, shorter-term moving averages are now acting as support for the price action, after the eventual bullish cross between them that took place during the beginning of the week.

Comparing with last week structure not much as changed in the daily charts for Bitcoin. Overall, several resistance indicators are developing around the $6,800 but, to the downside, we are also starting to draw some supporting lines: 50-SMA and 78.6% retracement. Below that, $6,200 and $6,000 stand for the backup plan of several speculators. On the way up, $7,000 always acts as a psychological threshold and $7,400 is the most recent local high to reach.

Volume

Daily traded volume is, on average, retracting and falling again to apathetic figures. On-balance volume resumed the symmetrical triangle formation and, with the latest trend to be downwards, is almost hitting its apex.Accumulation/Distribution, Klinger and MFI are all basically flattening out, although most of their moving averages remain slightly bullish. Due to huge volatile nature of the market is becoming almost imperceptible to forecast to which side will they progress in the upcoming days.

Last week we glimpsed some healthy signs of recovery but the drop in traded volume is becoming notorious and, as a consequence, oscillators have deteriorated considerably. It will be needed a more active and liquid market to give credit to the movements and strong assertion of the upcoming market regime.

Momentum

The lateral movement in prices and the apparent apathetic evolution of volume is also transferred into the momentum picture. Highlight to MACD and Awesome Oscillator flattening out and at a close distance to their zero line. Stochastic is also retracing and starting to trace a divergence with price, although Willy remains with a positive evolution and still at with a wide margin to progress. PPO’s Laguerre stood at the border of starting to flash sell signals while Aroon Down is tracing parallels with Up and converging to the ground.

Not many insights have been taken from momentum, with the narrowing of the trading channel and apparent low volatility of Bitcoin not exerting a notorious selling or buying pressure. The rising of the lower limit of the trading channel is confirmed on the charts, but it’s a weak setup that, on a more volatile period, can break up easily.

Final Remarks

Last week we have alerted for the fact that the market was starting to develop the same symptomatic behavior on the volume side of the equation, after having shown some signs of recovery on the aftermath of the $6,000 mark approach. Now the technical indicators for volume have augmented that same early signs and market readings are starting to become pretty unpredictable.

Trade ideas – Market entry/exit values.

[…] the remaining content of the forecast section discloses several market strategies (entry / exit points) and can only be viewed by subscribers. Subscribe the “Investor or Pro” plan to have full access. Follow our daily updates through our SLACK exclusive Investor Club.

Join our exclusive investor club


Week Highlights


 

 

 


 

RESEARCH REPORTS & NEWSLETTER

 

Join our mailing list to receive the most insightful market commentary and information compilation of the top crypto-assets available

You have Successfully Subscribed!