What’s Next For Bitcoin After Its Recent Drop?

Bitcoin markets have been relatively calm since yesterday afternoon, when the digital currency fell more than 8% in a matter of hours.

The cryptocurrency declined to as little as $9,410.92 yesterday, down from an intra-day high of nearly $10,300, and has since been trading between $9,400 and $9,800, CoinDesk price data shows.

Going forward, bitcoin may benefit from strong support in the short-term and a bullish trend in the long-term, said analysts.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

“On the bright side, the $9,500 level is providing decent support for now, and the $9,000 price point is becoming a stronger foundation every day it is not breached,” said Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital.

“Moving forward, we can expect the price to fluctuate between $9,500 and $10,000, with a drop to $9,000 being the worst-case scenario,” he stated.

Kiana Danial, CEO of Invest Diva, also weighed in, noting that yesterday’s pullback certainly did not come as a surprise to her, as she was expecting such retracements.

In spite of this recent decline, she believes that…

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‘Don’t be late to the party’ — bitcoin rose 170% the last time this signal flashed

Bitcoin $26,000?

If history repeats itself (spoiler: it usually doesn’t), bitcoin could see a huge run in the next two months, according to Cointelegraph analyst Keith Wareing.

Why? Look to the cross… the “golden cross.”

Yes, bitcoin’s BTCUSD, -0.52% ascending 50-day moving average recently crossed over its 200-day moving average, a rare occurrence that had other popular crypto pundits chiming in on Twitter TWTR, +1.87%  :

As Wareing pointed out, the last time bitcoin saw this kind of bullish action, the price shot up 170% in less than two months.

Meanwhile, optimism continues to bubble over among crypto bulls, like Max Keiser, who just raised his target from $100,000 to

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The Golden Cross Is Here: The Last Time This Happened Bitcoin Price Surged 165% In 2 Months

A rare bullish signal took place this week. The Golden Cross, as it’s commonly referred to, is a phenomenon that happened despite the price of Bitcoin dropping from $10,500 down to its current level at around $9,800. Historically, this has caused BTC to surge in value in the mid-term.

Bitcoin’s Most Recent Golden Cross

Bitcoin went on a downfall the past couple of days. Having reached $10,500, the price declined violently, losing as much as $1,000 in the following days. BTC found support in that area and recovered slightly as it currently trades at around $9,750.

However, despite the steep decline, a rare bullish signal flashed once again on the charts. Bitcoin’s 50-day moving average just crossed over its 200-day moving average.

This is a rare phenomenon that is commonly referred to as the “golden cross.” It’s a historically bullish pattern, and it takes into account two of the most commonly used moving averages.

The last time this happened was back on the 22nd of April in 2019.

bitcoin_golden_cross_20192020-min
Bitcoin Charting Golden Crosses in 2019 and 2020. Source: TradingView

As seen on the chart above, after the Golden Cross took place in April last year, the price surged to its yearly high at around $14,000 in June – approximately about 60 days after the cross happened. This marked an increase of nearly 165% in the given period.

Bitcoin is currently trading at around $9,750. If history repeats itself and the pattern does drive the price higher, an increase of 165% would put BTC at approximately $26,000 by the end of April 2020. Interestingly enough, this is immediately before Bitcoin’s halving takes place as it’s estimated to happen in May.

In-Line With Current Bitcoin Price Predictions

It’s worth noting that a few experts have already shared their Bitcoin price predictions for the short term.

First was Fundstrat’s Tom Lee, who said that Bitcoin could reach $27,000 by July. His main argument was that the price was trading above the 200-day moving average, which historically suggests increases of about 190% in the next six months. What is more, he also said that this happened in 80% of the situations.

Mike Novogratz also gave his prediction. According to him, Bitcoin is the “best brand of the past eleven years” and that it will test $20,000 in 2020 once again. Moreover, he said that this could also happen by the time Bitcoin’s halving takes place in May.

Be Careful With Bitcoin Price Fakeouts

History should never be used as a flat-out indicator for future price movements. Even though the Golden Cross has historically produced increases in the mid and long term, it’s also essential to keep an eye out for fakeouts.

golden_cross2
Golden Cross Patterns in 2015. Source: TradingView

As Cryptopotato reported, back in 2015, Bitcoin charted two Golden Cross patterns. The first one, however, appeared to be a fakeout, and the 50MA temporarily crossed back below the 200MA. Even though it continued back up, taking up short-term long positions might be riskier, despite the bullish crossover.

The post The Golden Cross Is Here: The Last Time This Happened Bitcoin Price Surged 165% In 2 Months appeared first on CryptoPotato.

Source: Crypto Potato

3 Ways Coronavirus May Have Affected Bitcoin

  • Is there a correlation between bitcoins price action and the coronavirus spread? 
  • Virus-infected yuan placed in quarantine—Bitcoin fixes this. 
  • Bitcoin mining takes a dive following China’s coronavirus clampdown.

As coronavirus continues to spread mass panic around the globe, its impact on bitcoin is becoming more evident. Here are three critical repercussions for BTC amid the outbreak.

As The Coronavirus Spreads, Bitcoin Continues To Break Out

Bitcoin is proving its worth as a macro hedge against global uncertainty. Year-to-date, BTC has achieved a 35% boost and managed to hit a yearly high north of $10,000 last week.

” alt=”” aria-hidden=”true” />BTC year to date gains 2020 coronavirus
Bitcoin’s year-to-date gains seem to correlate with the coronavirus outbreak. | Source: Tradingview

For many, this is clear-cut evidence to solidify bitcoin’s status as a risk-off asset. The notion goes that with China’s economy weakening, Chinese investors have piled in on bitcoin to make use of its safe-haven narrative.

On Feb. 3, one of China’s foremost stock indices—the CSI 300—plunged 9% in what was dubbed its worst open in over a decade. To add salt to the already festering wound, the Shanghai Composite Index nosedived 8%.

Chinese stocks quickly bounced back. An attempt at economic stimulus appeared to do the trick, with the Chinese government cutting interest rates to bolster the economy. Meanwhile, bitcoin continues to hold near $10,000.

For eToro’s senior market analyst Mati Greenspan, the correlation between bitcoin and the coronavirus dip is merely coincidental. Speaking to CCN.com Greenspan said:

Amazingly, Chinese stocks have already fully recovered from the coronavirus dip. If stocks have scant been affected, it would be a difficult case to try and say that crypto has been noticeably moved by this.

China Quarantines Infected Cash. Can Bitcoin Fix This?

With the official death toll mounting to 1,775 and 71,811 confirmed cases of the coronavirus worldwide, China is stepping up its prevention game.

” alt=”” aria-hidden=”true” />Coronavirus global cases by Johns Hopkins CSSE CHina
Coronavirus global cases surmount 70,000. | Source(s): Johns Hopkins CSSE / GIS and Data.

One of China’s latest methods to help quell the spread of the coronavirus involves cleansing cash.

China has begun using ultraviolet light or high temperatures to disinfect banknotes, according to a central bank press conference. The prevention strategy includes quarantining the banknotes for up to two weeks before redistribution.

Preceding the recent new year celebration, China’s central bank made an “emergency issuance” of four billion yuan notes designated for Hubei-—the virus’ epicenter.

For the crypto community, this provides another positive narrative as to why…

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Meet Bitcoin Market’s Most Accurate Technical Indicator: Lamborghini

Take a break Golden Cross, bitcoin now has found a better technical indicator in Lamborghini this Valentine’s Day.

So it appears, there is a great positive correlation between the cryptocurrency’s price rise and the mention of one of the most beloved sports cars on Reddit. David Gilbert of data analysis portal ChartStar noted that both the metrics rose and fell in tandem during the bitcoin’s last bull run, giving out an unforeseeable relationship.

bitcoin, crypto, lamborghini

Lamborghini trend on social almost followed bitcoin’s bull run in 2019 | Source: ChartStar, David Gilbert

When Bitcoin Traders Win

Mr. Gilbert explained that he queried all the Reddit comments for the keyword ‘Lamborghini’ and ‘Lambo’ using Google’s dataset services. The researcher confirmed focusing on main crypto subreddits, including r/bitcoin, r/cryptocurrencies, r/ethtrader, r/dogecoin, and a handful of others.

“What I find interesting is whilst Lambo mentions clearly spike after the biggest price increase, there is also a very substantial surge in Lamborghini mentions early on the bullish phase,” said Mr. Gilbert.

ChartStarHQ@ChartStarHQ

Querying billions of Reddit comments reveals Lamborghini mention frequency is a technical indicator of Bitcoin price rises.

Read our blog post to see what the 2020 Lamborghini trend says 👉https://chartstar.com/blog/mentions-of-lamborghinis-on-reddit-as-a-predictor-of-bitcoin-price/ 

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He noted that mentions of the sports car spiked during the 2019 bitcoin bull run, adding that the trend was getting repeated in during the 2020’s parabolic price rally.

“Let’s all pause for a brief second and admire the subtle beauty of that sharp upward trend in Lambo mentions from the last week,” explained Mr. Gilbert with a chart (as given below). “Note that the time scale at the bottom is “year-week” and goes up until the 6th week of this year which is as far as I could take it.”

bitcoin, crypto, lamborghini

2020 Bitcoin price rally matching steps with ‘Lamborghini’ trend on Reddit | Source: ChartStar, David Gilbert

The Crazy Bitcoin Correlations

Bitcoin’s amusing correlation with assets that hold no technical resemblance to cryptocurrencies is not a new thing. Earlier this year, the world’s first crypto asset received mentions in global media coverages for registering a price rally in 2017 that was eerly similar to parabolic moves in the Tesla stocks in 2019-2020.

tesla bitcoin comparison chart

Tesla vs Bitcoin

Similarly, bitcoin was spotted by social media for moving too closely with the prices of Avocado, a must fruit for all the low-carb, healthy fat diet maniacs. Tracy Alloway, the executive editor at Bloomberg, tweeted:

Tracy Alloway@tracyalloway

Avocado prices are clearly tracking Bitcoin.

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But the mention of Lamborghinis, which became a ‘prize’ meme for young investors who struck rich during bitcoin’s bull runs, came closer to…

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Is bitcoin’s 2020 rally another flash in the pan?

Crypto analysts are split on whether bitcoin’s rise this year is driven by unique factors or is just its latest bout of volatility. But many agree on one factor: an upcoming cut to the supply of bitcoin.

Bitcoin has soared by almost half this year, to more than $10,000, for the first time since October. On Tuesday it hit its highest in five months.

The cryptocurrency’s 11-year history is replete with fast ascents and equally rapid plunges. In late 2017, it rose three and a half times in just 35 days to reach almost $20,000. It then slumped 70% in seven weeks.

Such wild and often inexplicable swings are why bitcoin faces a struggle to become a functioning currency.

This time around, some market players point to a confluence of drivers not seen before. Arcane tech factors, expectations for mainstream acceptance and macroeconomic trends are leading markets to look again at bitcoin’s worth, they say.

“You can argue that there is a fresh valuation going on,” said Russ Mould, investment director at AJ Bell, a stockbroker that oversees assets worth $71 billion.

Most fundamentally, many cite growing demand for bitcoin before its latest “halving” — a 50% cut in the production of the cryptocurrency due in May that is one of the few observable events known to materially impact price.

A rule written into bitcoin’s underlying code slashes the number of new coins awarded to the miners behind the global supply of bitcoin.

In the year after the two previous halvings, in November 2012 and July 2016, bitcoin rose around by 80 times and four times respectively. The exact proportion of the gains caused by the halving is unclear.

“It’s a rare observable factor – if you look at previous events, in each case there has been a quite clear and discernable spike in the value of bitcoin,” said Windsor Holden, a payments consultant who tracks crypto and blockchain.

GRAPHIC – Bitcoin’s Halving: here

Reuters Graphic

“HYPE CYCLE”

But others doubt bitcoin’s latest rally is underpinned by anything more substantial than the previous booms.

“The recent rally has been driven by the usual hype cycle that we have very reliably seen every two to three years,” said Michel Rauchs, author of several Cambridge university studies on cryptocurrencies and blockchain tech.

“We have these mini-bubbles, and the momentum that it creates – bitcoin first, then these other coins. It’s a self-fulfilling prophecy.”

Major cryptocurrencies that tend to move in correlation with bitcoin have also gained this year. Ethereum has more than doubled; Ripple’s XRP token is up over 75%.

Other factors cited for the rally, such as greater demand for assets uncorrelated to mainstream markets following the U.S. killing of an Iranian military commander last month, are also questionable.

Bitcoin’s “safety” characteristic is unclear. It has regularly fallen in times of geopolitical stress in recent years.

Looser central bank policy is also given as a reason bets on riskier assets. But that link is hard to prove, too. Bitcoin has fallen during previous spells of easy money.

DIGITAL DOLLAR?

Also widely cited are expectations that cryptocurrencies will go mainstream, as central banks step up their research into digital currencies after Facebook’s push to offer its Libra coin. Some, such as China’s, are getting closer to issuing their own coins.

And in comments that traders said stoked buying in bitcoin, U.S. Federal Reserve Chairman Jerome Powell told U.S. lawmakers on Tuesday that the Fed was “working hard” on the issue, while it remained undecided on any digital dollar.

Central bank interest is also…

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Federal Reserve’s Kashkari tears into ‘giant garbage dumpster’ cryptocurrencies

Minneapolis Federal Reserve President Neel Kashkari didn’t pull punches when giving his opinion on the cryptocurrency sector on Tuesday.

When asked at a Montana event whether he would want his 1-year-old daughter to be gifted a Treasury bond or a bitcoin for her next birthday, the Fed chief picked the former, saying cryptocurrencies are “like a giant garbage dumpster.” Kashkari praised the dollar’s stability compared with the relatively new crypto sector.

“The reason that the dollar has value is because the US government has a legal monopoly on producing the dollar,” he said. “In the virtual-currency and cryptocurrency world, there are thousands of these garbage coins out there. Literally, people have been fleeced for tens of billions of dollars, and finally the SEC is getting involved in cracking down on this.”

Cryptocurrencies are known for their heightened volatility, as their round-the-clock tradability and speculative nature keep prices from remaining stable for even a few minutes. Bitcoin’s price swelled nearly tenfold in the second half of 2017 and just as quickly lost value as investors questioned the coin’s true value.

The Fed official didn’t completely turn his back to the technology, clarifying that cryptocurrencies could prove important in the coming decades but remain a highly volatile asset for the time being.

“Maybe five years from now or 10 years from now or 20 years from now something useful will emerge from this, but so far, all that’s emerging is burning garbage,” Kashkari said.

Tuesday wasn’t the first time the Fed president spoke out against the burgeoning cryptocurrency industry. Kashkari deemed the assets a “farce” while…

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Bought the Dip? Bitcoin Price Rebounds Strongly

Bitcoin (BTC) price made a small correction yesterday as it dropped from $10,100 towards $9,800. However, today’s bullish momentum returned and the price bounced back above $10,000 to make a new 2020 high at $10,370.

So is the continuation of bullish momentum likely? Let’s look at the charts to see what could occur next.

Crypto market daily performance. Source: Coin360

Bitcoin finds support at $9,800 and continues upwards

BTC USDT 12-hour chart. Source: TradingView

Many Bitcoin traders were waiting for the price to drop to the support at $9,500 but this was not to be. Instead of dropping further, the price stabilized at the $9,750 level and continued its upward momentum.

Does this mean that continuation is likely? The current price action still looks slightly and Bitcoin didn’t break above the next massive resistance.

Nevertheless, it’s a great sign that the $9,500 level was cleared as that was a significant resistance for upwards continuation. However, the next hurdle is the $10,400 area where Bitcoin currently finds resistance.

Through that, a range is defined, which is found in the following chart.

BTC USDT 12-hour chart. Source: TradingView

The range is defined by the resistance at $10,400 and the possible lower support zones at $9,500 and $9,800. If the price can’t break the $10,400 area then it will then likely pull back to retest this area.

Such a test would also mean that the price is going to consolidate for a while. Consolidation at this level would imply re-accumulation before the continuation of the upward trend.

If the price of Bitcoin can break through $10,400, the next resistances are found at $10,900 and $11,600-11,900 where there is also an open CME gap.

Total market capitalization shows strength

The total market capitalization still provides a brighter view than the Bitcoin chart alone.

Total market capitalization cryptocurrency 12-hour chart. Source: TradingView

The chart is showing a clear support/resistance flip at $245 billion, after which the market capitalization continued to rally upwards. The next target area is found at $285 billion and $300 billion.

A retest of $260 billion was likely to occur, but the market didn’t give such a retest as $275 billion became support.

This gives the impression that…

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This Bitcoin Bull Run Is Extremely Different To 2017’s Epic Rally

Bitcoin has been on a major tear over the last few weeks—with the bitcoin price adding an eye-watering 40% since the beginning of the year.

The bitcoin price, which was trading under $7,000 per bitcoin just two months ago, has surged to over $10,000 this weekendand many are expecting bitcoin, as well as the booming wider cryptocurrency market, to keep on climbing.

The latest rally comes some two years after the bitcoin price soared to almost $20,000 per bitcoin back in December 2017, rocketing from under $1,000 at the beginning of the year as bitcoin and cryptocurrency fever swept the world—but data suggests this bitcoin bull run is very different.

Bitcoin exchange deposits have dropped sharply over the last six months, suggesting the latest bitcoin rally isn’t being driven by retail investors, bitcoin and crypto analytics firm Glassnode data revealed.

“During last summer’s rally, we saw highs of over 60,000 unique daily deposits—likely investors taking profit,” Glassnode said via Twitter, adding the decrease could be due to long term bitcoin investors having “fewer incentives to sell.”

“Since then [bitcoin exchange deposits have] decreased by nearly 60%, down to 25,000.”

At the peak of 2017’s epic rally, bitcoin exchange deposits outpaced the bitcoin price, with Glassnode recording around 200,000 daily exchange deposits.

Bitcoin exchange deposits have previously increased along with the bitcoin price, with deposits falling back during bear markets.

However, deposits have continued to slide this year despite the uptick in the bitcoin price, leading many bitcoin and cryptocurrency traders and investors to attribute the latest bull run to long-awaited institutional investors buying up bitcoin.

“This breakout is the real deal,” said Willy Woo, partner at bitcoin and cryptocurrency hedge fund Adaptive Capital. “Fundamental investment activity is backing this $10,000 breakout.”

This theory is backed up by the latest numbers reported by the world’s largest bitcoin and cryptocurrency asset manager, Grayscale.

Last month, Grayscale revealed it recorded inflows of $600 million in 2019, more than 2013 through 2018 combined, and declared institutional money has finally arrived in the cryptocurrency space.

“If the persistent question is ‘where are the institutions investors in crypto?’ the answer is that they’re here and showing up in a meaningful size,” Michael Sonnenshein, managing director at Grayscale, said at the time.

Meanwhile, some are expecting the looming bitcoin halving event, which will see the number of bitcoin rewarded to miners cut by half in May, to trigger another wave of…

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Bitcoin vs. Altcoins: Which Will Make You More Money in 2020?

Now that market sentiment has changed and traders are feeling bullish, comes the age old question, Bitcoin or Altcoins? Let’s take a look at which investment strategy may have the bigger payoff.

Buy Bitcoin or take chances in the Altcoin Casino?
The bullish sentiment is back, and traders have been placing their allocations on their favorite blockchain projects. The question on most investor’s minds is which coin will have the biggest payoff? Is it Bitcoin, the largest coin by market cap, or smaller cap Altcoins?

Bitcoin is the most decentralized project, with the most users, and the best minds in computer science currently working on advancing the networks development. It has the largest network effect, the most supporting infrastructure built out around it, and the best trade-offs for self sovereignty. Perhaps most importantly for traders, Bitcoin also has the most liquidity, and is the most secure network, with the highest amount of POW hash rate to validate transactions.

Altcoins on the other hand are usually a lot more volatile and risky. They are not as secure, don’t have as much liquidity, and can often be attacked since they have a lower hash rate, or they are less secure consensus-wise like many PoS coins. Some altcoins have competent devs, others do not. Each altcoin should be looked at on a case by case basis and intimately studied by investors, before they go long.

Large cap altcoins like Bitcoin Cash or Ethereum do have a fair amount of infrastructure complementing the networks. For example DeFi is almost at a billion dollars investment on ETH. That being said, each of these projects built on top of an altcoin platform needs to be scrutinized individually, as there are usually tradeoffs.

Altcoins offer high volatility
Many altcoin traders like the added volatility of small cap altcoins because they offer a much larger profit if they do start to moon. Most altcoins rise when Bitcoin rises, sometimes by a lot more than BTC itself, but the same holds true if BTC starts to dump also.

During the 2017 bull run some traders became millionaires from a super small altcoin that suddenly received a bunch of interest because of a partnership, or new feature. Regardless, most altcoins lost over 90% of their value during the bear market and some projects died leaving investors holding a bag of worthless tokens.

Bitcoin has fallen in price dramatically and lost more than 80% of its price several times, but has also gone from $0.06 to its all-time high of $19,891, gains of 33,151,566.66%. It is very volatile, but due to its limited supply, and consensus rules, a very secure investment, with almost unlimited upside potential.

Altcoins should be viewed more as penny stocks. You may be able to pick out the next Google, Amazon or Tesla, but it isn’t very likely. It’s more likely to be dumb luck. Each Altcoin is very different from every other, and also very different from Bitcoin.

If you plan to invest in Alts, please do your own research and be aware that disingenuous marketing sensationalizes almost every altcoin project. Altcoins, and the companies behind the projects are also vulnerable to regulation, Bitcoin is not.

Bitcoin is the far better investment for 2020. Not only is it seen as a safe haven asset, but it’s also the original cryptocurrency and continually leads blockchain development through it’s BIP process. Altcoins can make you more money than Bitcoin, it’s true, it’s just a lot riskier, and you could lose everything in an instant.

The post appeared first on Bitcoinist.com.

Source: Bitcoininst