Bitcoin Rally Sustains While Investors in Other Crypto Assets Continue To Suffer 5711

Last night, Bitcoin broke back above $6,000 across the crypto market, and to many, it’s a signal that the bottom is “in” and the bear market is now a lingering memory.

While the leading cryptocurrency by market cap has nearly doubled since its 2018 low, the rest of the crypto market continues to bleed out, with most altcoins setting new lows in their ratios relative to BTC. With Bitcoin at an inflection point, and much of the market in disbelief, analysts are torn as to whether altcoins like Ethereum and Ripple will continue to plummet, or are an attractive buy at this level.

In a recent Twitter poll, it was revealed that the average large majority of crypto investors are diversified across two to nine coins, which may or may not include Bitcoin. Only 16 percent of crypto investors responding to the poll claimed to be holding only Bitcoin, suggesting that only a small subset of crypto investors have experienced relief during the current Bitcoin rally.

While Bitcoin has nearly doubled in value since its 2018 low, altcoins have continued to suffer relative to their price in BTC. Much of the altcoin market is paired with BTC on exchanges, causing Bitcoin to have a powerful impact on the price of these other crypto assets.

Big Picture#Bitcoin surged to a new 2019 High while ALTs continued their bleeding

New 2019 low for $BTC paired frontline ALTs$XRP $ADA $XLM $TRX $XMR $DASH $IOTA $ETC $NEO $ZEC $ZRX $ICX $ZIL$BTC dominance at almost 18 month high now

Prior to Bitcoin breaking through $4,200 at the start of the April rally, altcoin growth had been closely correlated with the first ever cryptocurrency. Many were calling for an “alt season” – a period where altcoins experience extreme growth relative to BTC.

However, following that break of resistance, altcoins have been decimated through an inverse relationship with Bitcoin. The relationship between BTC and altcoins is fickle, with alts sometimes pumping when Bitcoin grows, and other times dumping violently while Bitcoin climbs.

The promise of alt season now has become a running joke across the crypto industry. However, such a decoupling may be a healthy sign for the crypto market, as YouTube personality Tone Vays and crypto entrepreneur Vinny Lingham say it is needed for a full blown Bitcoin bull run to begin once again.

Will Altcoins Set New Lows Or Rebound if Bitcoin Can Hold $6K?

As many altcoins, such as Ethereum, Ripple, and Stellar reach new lows in their BTC ratios, analysts are torn if these price levels present a strong buying opportunity, or are due to set even more extreme lows.

Bitcoin dominance is now at an 18-month high, and a rebound across the altcoin market is expected if Bitcoin can hold at levels around $6,000. Should Bitcoin fall further, it could cause most altcoins to fall off a cliff and see their ratios relative to BTC plummet further.

If altcoins do rebound, they have a lot of catching up to do if crypto investors that aren’t Bitcoin maximalists are ever to get some relief.

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Another Hard Fork, Will Bitcoin Cash Tank or Soar in Response? 4513

  • Bitcoin Cash (BCH) up 6.8 percent
  • Schnorr Signatures implementation ahead of the more decentralized OG

Six months after a contentious hard fork, Bitcoin Cash developers plan to upgrade the network to include Schnorr signatures that require less space while simultaneously promoting scalability, security, and privacy. Meanwhile, Bitcoin Cash (BCH) prices are stable, up 6.8 percent in the last week.

Bitcoin Cash Price AnalysisFundamentals

Roger Ver maintains that Bitcoin Cash (BCH) is the real “Bitcoin” and knows little about Craig Wright’s Bitcoin SV. Although Bitcoin Cash is a fork of Bitcoin, supporters claim that their big blocks make the network more scalable and therefore, there is no need for implementing layer-2, off-chain solutions like Lightning network.

Despite Roger Ver and Bitcoin Cash proposal, adoption levels are low and compared to Bitcoin or even the second most valuable network in Ethereum (ETH), Bitcoin Cash is lagging. Even so, it is popular in Japan where “Bitcoin Jesus” resides, and the Kraken acquisition of Crypto Facilities did boost trading volumes around BCH derivatives which is positive.

However, a stand out is their ability to integrate solutions that make the network more resilient and private. Planning for a hard fork on May 15, Bitcoin Cash developers will upgrade the system, replacing the Elliptic Curve Digital Signature Algorithm (ECDSA) with a new signature protocol, the Schnorr Signatures that introduce privacy while making the network faster, secure and scalable.

Unlike the ECDSA, Schnorr signatures require less space, cutting down bandwidth requirement by a massive 25 percent.

Candlestick Arrangement

At the time of press, Bitcoin Cash (BCH) is stable and up 6.8 percent in the last week. Despite the dragging effect of Bitcoin and their direct correlation, we expect BCH prices to be resilient.

Notice that BCH is within a bullish breakout pattern against the USD as the asset trade above a critical resistance level—now support, at $230. Because prices are reacting at the 61.8 percent Fibonacci retracement of the week ending Apr-7 high low, the underlying moment is intense.

Typical of Fibonacci retracements, the reaction from such level would most likely lead to a retest of previous highs. In that case, risk-off, aggressive traders should be angling for $350. After that, any clearance would see BCH retest Nov-2018 highs of $400 in a classic retest.

Any breach above $400 cancels the bear breakout of Nov-18, spurring the next wave of higher highs toward $650 or Oct 2018 highs.

Technical Indicator

Ideally, any break above $300 should be with high participation level above Apr-3 volumes—462k. That’s a tall order unless there is a fundamental spark that increases demand for BCH whose average volumes stand at 57k

Chart courtesy of Trading View

 

Gold Futures Projects Bitcoin Price 350% Higher in Roughly 378 Days 5237

There is a strong possibility that the bitcoin price would surge by 350 percent in roughly 378 days, according to past trend behavior noted in the Gold Futures market.

Cryptocurrency management firm Trading Shot found striking similarities between the Gold Futures (COMEX) and the Bitcoin spot market. The firm noted that bitcoin’s 2017 surge towards its historical high at $20,000 looked very similar to the Gold Futures’ bullish performance between July 1976 and January 1980. Moreover, their expected bearish corrections also trended hand-in-hand, as shown in the chart below.

Gold Futures and Bitcoin Price Comparison | Source: Trading Shot

Interim Projection

Bitcoin Death Cross | Source: Trading Shot

Trading Shot projected bitcoin’s latest Golden Cross formation as a turning point, stating that the price “will continue to rise towards new all-time highs aggressively.” At the same time, the firm reminded that bitcoin could go through a brief pullback even after forming a bullish Golden Cross. It made the argument based on bitcoin price action in 2015, in which the market built a death cross just two months after forming a Golden cross.

“It is obvious that Bitcoinis trading on an important crossroad with various conflicting short term (because long term it is as good of an investment as any) signals. What is also obvious though, is that if Bitcoin continues to follow Gold’s early 2000s price action, and more particularly it’s Golden Cross, then it will continue to aggressively rise towards new All-Time Highs without any last pull back as it did in 2015.”

Studying Gold Futures Upside

Gold Futures Recovery | Source: TradingView.com

From the day the Gold Futures formed a Golden Cross, the price corrected upwards by more than 350 percent – from $429.5 to $1929.7. The derivative achieved the bull target in 31 years and six months.

Realizing bitcoin’s lifespan so far is shorter than that of Gold, and that its market is more volatile too, Gold’s one month can be termed as bitcoin’s one day. It is, of course, pure speculation (the relationship between the price and their time-based output can change dramatically).

That said – the rough estimation of 31.5 years for bitcoin comes out to be 378 days (taken from Gold Futures’ 378-month long bull bias). At the same time, the price target for bitcoin in 378 days after the bull cross confirmation comes near $18,539. There is, of course, a possibility of a death cross formation as stated above, which would mean resetting the 378-day timer upon forming the next Golden cross formation.

“Gold gave investors many similar buy signals throughout 1999 – 2003 at the end of its last bear cycle, just as Bitcoin is giving since last December,” stated Trading Shot. “Investors who ignored those and failed to buy Gold during the late 90s have missed a great opportunity, which has never come back. Investor psychology during market cycle’s can be identical throughout very different financial assets.”

Stocks Plunge Could Spell Trouble For Bitcoin in Near-Term, Risking Recent Momentum 5089

In a cruel twist of fate, it seems that tweets affect not only crypto assets, such as Bitcoin (BTC), but traditional markets too. On Sunday, U.S. president Donald Trump revealed that he intends to increase tariffs on Chinese-made goods from 10% to 25% by Friday. Global assets, like stocks and even BTC, flashed red minutes later.

For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods. These payments are partially responsible for our great economic results. The 10% will go up to 25% on Friday. 325 Billions Dollars….

Bitcoin Drops With Trump’s Chinese Tariff Threat

While Trump’s out of left field maneuver had good economic intentions, stock markets didn’t react all too kindly. Futures for the S&P 500 are currently 1.75% down, implying a red open, and Asian markets, namely the Hang Seng (Hong Kong) and SSE Composite Index (China) got absolutely slammed. As of the time of writing, the SSE is down a jaw-dropping 5.3%, wiping out billions of dollars of wealth in a few hours’ time.

Related Reading: Bitcoin VC: China Tax Reform Could Help Crypto Assets “Bloom”

As hinted at earlier, Bitcoin followed right behind its brethren in traditional markets. As pointed out by crypto trader “Light”, when Asian markets opened on Monday, BTC fell right in lockstep, reacting to the tariff salvo negatively. There is a fleeting chance this is pure coincidence, but Bitcoin lost a very similar percentage to the Hang Sang in the same time frame, implying that BTC remains a “risk-on” asset, as Light explains. (Note: BTC has since started to recover)

Market participants continue to view Bitcoin as a risk-on asset.

This is not the only evidence pointing towards the idea that cryptocurrencies are risk-on, meaning an asset class investors prefer in markets trending higher.

Last week, Travis Kling of Ikigai Asset Management drew eerie similarities between the chart of the SSE and Binance Coin (BNB). As seen below, from mid-2018 to April 30th of this year, the index and the cryptocurrency (which is notably popular in Asia), followed each other. Or rather, BNB followed Chinese stocks to a tee. “Crypto is a risk asset, global capital flows matter,” Kling remarks.

What’s more, a few weeks back, Fundstrat’s Tom Lee postulated that risk-on emerging markets, whose value is captured through the MSCI Emerging Markets Index, pulled down BTC over 2018. More specifically, this specific index fell by 27% over 2018, as BTC lost 70%.

With Trump unlikely to budge, the U.S. stock market and other global indices may continue lower, potentially unwinding Q1’s monumental rally, thus being a short-term detriment to BTC and other cryptocurrencies.

Bitcoin To (Eventually) Become Safe Haven As Digital Gold

So why is all the above information relevant?

Well, it shows that Bitcoin may be conforming to traditional markets’ risk-on assets after all.

For those unaware, cryptocurrencies have long been touted as an uncorrelated asset. In a CNBC interview in December, Anthony Pompliano of Morgan Creek noted that the correlation between BTC and the S&P 500 (SPX) is practically non-existent. Three Arrows Capital’s Su Zhu later confirmed this point, noting that through “high prices and low prices, high volatility and low volatility, the correlation between” the two aforementioned indices is still near-zero.

Monday’s confirmation of some correlation corroborates a theory proposed by John Normand, the head of JP Morgan’s cross-asset management arm, that gold remains a better safe haven or hedge against downturns than Bitcoin.

However, that’s not to say that the digital asset class won’t be able to break free eventually. As explained by Max Keiser, a prominent anti-establishment figure and Bitcoin OG, BTC will eventually become a “risk-off” asset, hinting at the characteristics that make it a form of sound money. The reason why he, along with many others, think so is that BTC is a non-sovereign, decentralized, censorship-resistant, and easily-transferrable asset that is strictly scarce and is not subject to the whims of central banks and the incumbent financial institutions.

Consumers may need a bit of a kick to understand this fact though. And this kick is expected to be the next financial crisis, which many pundits say is looming right over our collective head.

Bitcoin Up 8.2 Percents as More Americans Hold 4318

  • Bitcoin (BTC) up 8.2 percent in last week
  • More Americans are owners of Bitcoin

A Blockchain Capital survey reveals that Bitcoin awareness, familiarity, and perception has improved, explaining the high Bitcoin (BTC) ownership in the US. At the time of press, Bitcoin (BTC) prices are stable, above $5,500 as buyers aim at $6,000.

Bitcoin Price AnalysisFundamentals

Blockchain brought decentralization with the community building applications on public ledger securing the network by running full nodes. Bitcoin and Ethereum are the two topmost decentralized, proof-of-work networks dependent on the community for security and transaction confirmation. Even so, Bitcoin’s parameters are not immune to fluctuations.

Of the many like centralization and distribution levels, the hash rate can divulge more than just security. At a glance, hash-rate measures sentiment.  At the moment, rising prices are drawing efficient miners meaning the view is positive. Because of shifting sentiment, many investors are flocking back to BTC increasing its dominance levels.  However, as prices retest critical resistance levels, Bitcoin’s hash rate plunged 22 percent in less than a week to around 42 EH/s.

If anything, this is bearish and could be a leading indicator that prices may drop in days ahead. That is despite what a recent poll by Blockchain Capital revealing that 11 percent Americans are Bitcoin holders. The report further reveals that “despite the bear market, the data shows that Bitcoin awareness, familiarity, perception, conviction, propensity to purchase and ownership all increased/improved significantly.” Furthermore, the shift in trend “highlights that Bitcoin is a demographic mega-trend led by younger age groups.”

Candlestick Arrangement

At the time of press, Bitcoin (BTC) is up 8.2 percent in the last week. Despite temporary liquidation, we expect prices to rally in coming weeks thanks to improving fundamentals and general expectations in the market after a year of winter.

All the same, it appears that before buyers resume and build on the upswings of early April, participants must first reject lower lows. From candlestick arrangement, there seems to be a correction following the over-valuation of May-4-5 when two bars did close above the upper BB. In that case, it is likely that Bitcoin (BTC) will retest $5,400 before the resumption of the original trend.

Technical Indicators

In light of the above, our reference bar is May-3 bull bar—19k versus 10k. It is wide-ranging, thrusting prices towards $6,000 and above Apr-24 highs. For bears to be in control, then any drop below $5,400 must be with high participation levels above 19k.

Chart courtesy of Trading View

Bitfinex $1B IEO Raise Could Pressure Bitcoin Lower 4048

On Saturday, reports revealed that Bitfinex, one of the largest crypto exchanges in existence, unveiled official plans to sell $1 billion worth of an asset called LEO. While this seems innocuous, a leading analyst warns that it could be a detriment to Bitcoin (BTC).

As reported by NewsBTC previously, last week, Dovey Wan, the founding partner of Primitive Ventures, revealed that Bitfinex was planning to raise $1 billion through the sale of company-branded crypto tokens through an on-platform initial coin offering, more commonly referred to as an IEO. Some took this news, however, as a joke, noting that there’s no way that the Hong Kong-headquartered exchange would enlist such a strategy, especially after last week’s news that it is in precarious legal and financial standing.

Per a document published by Chinese cryptocurrency investor Zhao Dong, first reported on by The Block, however, the IEO is entirely legit. As Wan revealed, Bitfinex does intend to sell $1 billion of the cryptocurrency. Funnily enough, however, Larry Cermak of The Block has said that $600 million of the funding round has already been allocated to private investors, reported to be industry insiders, Bitcoin whales, and Asian venture capital firms.

On the matter of the token itself, the document hinted that LEO may be very similar in use to Binance Coin (BNB). More specifically, Bitfinex will purportedly spend up to 27% of its monthly profits to purchase LEO tokens, acting somewhat as a dividend for holders. It was also stated that if the exchange gets the $850 million it is owed back from Crypto capital, a Panamanian crypto-centric payment processor that is currently in the middle of an intense legal debacle, and the thousands of Bitcoin lost in a historical hack, Bitfinex will be able to buy back LEO with most of that capital.

Utility-wise, LEO can be used to reduce the rates they pay on the crypto exchange’s market. Taker fees for crypto-to-crypto pairs, lending rates, and withdrawal fees will all purportedly be subsidized for LEO holders.

Negative Bitcoin Price Action Catalyst

While this news seems to be independent of the broader cryptocurrency market, Tom Lee, Fundstrat’s head of research, has postulated that this $1 billion raise could actually be a negative price action catalyst for Bitcoin. The prominent commentator explains that $1 billion worth of new tokens will have a negative impact on BTC and other digital assets, as the market needs to “absorb” an influx of LEO tokens.

Lee, however, seems to be leaning bullish overall, despite the news regarding LEO. Per previous reports from this outlet, the Fundstrat co-founder remarked that the fact that BTC has rallied despite the Tether “FUD” might just be an early sign that “crypto winter is ending.” He adds that if Bitcoin continues to hold strong, failing to react to the constant inundation of Tether-related news for two more weeks, he “would be inclined to argue that this is [another] reason [why] crypto winter is over.” This isn’t the only development making the analyst bullish, however.

During a recent CNBC segment, Lee took a gander at blockchain statistics, specifically that of Bitcoin. He opined that the transactional value of on-chain transfers has turned positive on a year-over-year basis, signifying that BTC is still seeing constant use for its intended purpose, in spite of the brutal conditions in the market. What’s even more positive is the fact that average daily transactions processed on the Bitcoin chain are reaching near-all-time highs, but that the transaction fee market has yet to bubble notably.

Secondly, the long-standing cryptocurrency optimist looked to the fact that BTC has moved above and held on top of its 200-day simple moving average. Throughout Bitcoin’s history, and the history of other liquid, tradable assets, the aforementioned technical level has been seen as a kind of ‘make or break’ point, in that holding above it signals that bulls have the upper hand. Combine this with the fact that Bitcoin’s daily chart recently printed a golden cross, which saw the 50-day simple moving average cross over the 200-day, is another reason, in Lee’s eyes, that “spring” might finally be inbound for digital assets across the board.

Lastly, and arguably most importantly, is the growth in trading activity in cryptocurrency markets, especially over-the-counter (OTC) desks. Citing closed-door conversations, Lee explained:

“We surveyed OTC brokers, who are really important in facilitating institutional investors, and they’ve all talked about a 60% to 70% increase in activity/number of clients and trading volume per client. Fundamentals are improving; technicals are improving, and activity by HODLers too.”

Analysts Believe Bitcoin May Continue Dipping Lower Before Surging to $6,500 3053

The crypto markets have dipped as they head into the weekend after incurring a significant amount of upwards pressure throughout this week. The latest drop has put Bitcoin (BTC) back into the $5,600 region, signaling that the cryptocurrency’s bulls don’t have enough buying pressure to propel the crypto above $5,800.

Now, analysts believe that the crypto markets may continue dipping lower before they hit a price level at which they can continue surging higher.

Bitcoin Drops Into $5,600 Region

At the time of writing, Bitcoin is trading down over 2% at its current price of $5,675, down from its daily highs of nearly $5,900 which were set yesterday.

Prior to today’s dip, analysts were closely watching the $6,000 level to see if the crypto would be able to break into this price region, with some analysts claiming that a decisive move into the $6,000 region would mark the start of the next bull market.

Big Chonis, a popular crypto analyst on Twitter, shared his thoughts on Bitcoin’s current price action in a recent tweet, explaining that BTC’s previous daily resistance is now acting as support, which may be a bullish sign.

BTC May Dip Lower Before Breaking Above $6,000

Although it is clear that Bitcoin isn’t quite ready to move into the $6,000 region, today’s dip may not be low enough for the crypto to garner any significant buying pressure that allows it to continue surging higher.

Peter Brandt, a celebrated analyst who covers a variety of assets and markets, spoke about Bitcoin in a recent tweet, saying that its recent highs may be a top that leads it to fall towards lower before it incurs enough buying pressure to propel it towards $6,500.

“Just an opinion — there is a chance $BTC is topping here, having met its price target at key resistance. A correction could occur before another move toward 6500, then a more significant correction,” Brandt explained.

As the weekend continues on and traders gain a better understanding of how secure Bitcoin’s current position within the mid-$5,000 region is, it will likely become clearer as to whether or not a move to above $6,000 is in the cards in the near-future.