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Bitcoin price: Why $14K looks eerily similar to $700 during the 2016 election

Republished by Plato

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While most investors and traders anticipated massive volatility to occur through the election hours, little has happened. Bitcoin’s price is still relatively stable and hovering under the crucial resistance of $14,000.

At the same time, Bitcoin’s price has been moving in tandem with equity markets over the past 24 hours.

Bitcoin still can’t break the $14,000 resistance

BTC/USD 1-week chart. Source: TradingView

The weekly chart is showing a very healthy setup as the price movements look natural and organic via testing every previous support and resistance levels before continuation occurs.

As the chart shows, this structure has been established with the $10,000 level, after which the price of Bitcoin rallied towards the current price levels of $13,800.

In that regard, a correction towards the $11,500 region would be relatively healthy for the markets, which could see another support/resistance flip.

BTC/USD 1-week chart. Source: TradingView

These support/resistance flips are quite common, as they also occurred at the start of the previous cycle in 2016.

During this year, a significant number of range-bound constructions were seen. This occurs until the price of a certain asset enters price discovery, resulting in possible parabolic movements.

2016 election also didn’t see much BTC volatility

BTC/USD 4-hour chart 2016. Source: TradingView

An interesting perspective is that the current run-up of Bitcoin is similar to the one in 2016. In the weeks before the election of 2016, the U.S. Dollar Currency Index dropped substantially. This drop caused the price of Bitcoin to run from $600 to $740, a rally of more than 20%.

However, not much volatility occurred during the election itself. The volatility started to kick off when the election results were confirmed as the vertical red line shows. The price of Bitcoin moved by 6% in a few hours while the U.S. Dollar showed weakness.

The primary question will remain whether the election results will trigger volatility as the markets hold their breath.

Therefore, the big moves for Bitcoin and markets, in general, may occur after the election results are confirmed similar to four years ago.

BTC/USD 4-hour chart. Source: TradingView

The current pre-election chart is showing many similarities with the pre-election movements of 2016. A similar drop in the U.S. Dollar Currency Index has been pushing the prices of assets up.

This meant an increase in the price per Bitcoin from $10,600 to $13,800, a rally of 30% in a matter of weeks. The significant difference currently is the stabilization of the U.S. Dollar, while Bitcoin is still being resilient and continuing its upward momentum.

Short-term scenario for Bitcoin price

BTC/USD 4-hour chart. Source: TradingView

However, the 4-hour chart is showing the possibility of a bearish divergence to emerge on the charts. Bitcoin’s price has frequently been pushing towards the $14,000 barrier, just taking liquidity above the high.

These breakouts don’t entirely show strength as they continue to get rejected. In that regard, the crucial breaker would be the area between $13,850-13,975 for any continuation of the price. If that breaks, a potential target of $15,000 is on the table.

However, if it fails to break, a range support test at $13,000-13,200 seems inevitable. As discussed previously, a further correction wouldn’t be unhealthy for the markets as that may warrant a very healthy build-up for the bull cycle itself.

Higher timeframe scenario for Bitcoin price

BTC/USD 5-day chart. Source: TradingView

The 5-day chart shows a likely scenario in the case of a lower timeframe breakdown. Thus, if the $13,900 area continues to hold as resistance, a correction to the $11,500-11,800 area would not come as a surprise.

Such a correction would grant another support/resistance flip and further compression before the next impulse wave can start.

Once the price of Bitcoin is done with the accumulation and compression, a shot toward new all-time highs may come quicker than expected.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Source: https://cointelegraph.com/news/bitcoin-price-why-14k-looks-eerily-similar-to-700-during-the-2016-election

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Who pulls the trigger on Bitcoin’s volatility?

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The volatility that drove Bitcoin’s price below $31,000 has now brought it up to the $33,000-level, based on CoinMarketCap. In previous market cycles, the volatility has shown a cyclical nature. However, in the current market cycle, it depends on the momentum and activity of institutional investors.

Back in 2018, there was institutional participation. Alas, the momentum was high for only a short period of time and the short-term volatility was what led to a massive drop on the charts. More than the price, the perceived value of Bitcoin has had an impact on the current volatility. Since there was accumulation at the $34,000-level by most institutions and whales, the price was soon heading towards the $34,000-level on the charts again.

Who pulls the trigger on Bitcoin volatility?

Bitcoin Volatility || Source: Woobull Charts

Another metric, the active supply that increased significantly over the past 2 months, more so in 2021, may have led to increased volatility and the price drop on spot exchanges. A high active supply can be equated to increasing sell pressure. The price fluctuates in response to the cascading sell-off, and this is what happened during the “double-spend” sell-off on Thursday.

As demand for Bitcoin on spot exchanges is revived, sell-pressure is expected to ease off. In the current market cycle, institutional investors are pulling the trigger on volatility, even though the sharp sell-off on Thursday raised more questions on the sustainability of the price rally.

However, post the aforementioned price decline, Bitcoin made a comeback with 24-hour gains of over 5%, with the same trading at $33,460, based on CoinMarketCap, at press time.

In light of the inflows of investments into institutions’ Bitcoin products, it is likely that there may be an increase in demand and consequently, in volatility, leading to a short-term top in Bitcoin’s price.

Who pulls the trigger on Bitcoin volatility?

Grayscale’s Bitcoin Holdings || Source: bybt

When the price dropped, Grayscale added over 4% new Bitcoins to its holdings. Despite the significant drop in prices, institutions are not seen liquidating their holdings and if they continue to HODL, the price may continue on its onward trend. The immediate challenge is that of active supply on exchanges and that may drop once OI on derivatives exchanges increases to the level before the drop. This may occur post the Bitcoin Options expiry at the end of January. An increase in trade volume and volatility by institutions may lead the way.

Source: https://ambcrypto.com/who-pulls-the-trigger-on-bitcoin-volatility

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The race is on yet again for crypto ETFs as Valkyrie files registration

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In a move that may give seasoned investors flashbacks to 2018, Valkyrie Digital Assets is the latest asset management firm to file a registration with the SEC to form a Bitcoin ETF — a bid that joins a crowded field of prospective fund managers looking to capitalize on renewed retail interest in cryptocurrencies. 

Filed on Friday, the Texas-based family investment fund proposed listing the Valkyrie Bitcoin Trust on the New York Stock Exchange. The application did not include a possible trading ticker.

If history is any indication, however, the filing’s chances of leading to a tradable fund are slim. During the last Bitcoin bull run, multiple firms attempted to throw their hat into the ring as at least nine entities filed proposals for a Bitcoin ETF with the SEC, including ETF giants VanEck and Direxion, as well as Gemini, the crypto services firm formed by Cameron and Tyler Winklevoss.

In a previous interview with Cointelegraph, Kryptoin CEO Donnie Kim, whose firm filed for an ETF in October of 2019, says that the SEC has long been hesitant to move forward with proposals.

“At this moment in time the commission is listening and learning about this new asset class and they are in a holding pattern, partly to understand the consequences of the existing products on the market and partly to look for further guidance under the current political landscape,” said Kim.

Despite the commission’s historical reticence, as retail interest in cryptocurrency booms fund managers are once again clamoring to be the first to offer an ETF product.

On Thursday, Jan. 21 gold ETF giant VanEck — which was the first company to ever file for a Bitcoin fund — filed to form a Digital Assets ETF, which would track the performance of the Global Digital Assets Equity Index made up of crypto service companies.

While American ETFs have been hard to come by, other exchange-traded products are flourishing. Options for traders include a Swiss Bitcoin ETP, a bevvy of Grayscale products that may be expanding to include Chainlink in the coming months, and an Ethereum ETF in Canada that proved so popular trading had to be halted in its debut.

Source: https://cointelegraph.com/news/the-race-is-on-yet-again-for-crypto-etfs-as-valkyrie-files-registration

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Tezos, Verge, Nano Price Analysis: 23 January

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After Bitcoin clawed back to touch the $32,000-level from the sellers, the rest of the altcoin market took heart and posted gains of their own on the charts. Similarly, altcoins such as Tezos, Verge, and Nano were in the green at press time and projected more upside over the coming sessions.

Tezos [XTZ]

Source: XTZ/USD, TradingView

Taking cues from the broader market, Tezos skyrocketed by nearly 15% on the charts and traded close to $3.20, at press time. Gains over the past 24 hours pushed XTZ’s market cap north of the $2.5 billion mark as it climbed on the rankings to become the 16th-largest cryptocurrency by market cap.

A look at XTZ’s 4-hr chart showed that the price broke above its 20-SMA (red) and 50-SMA (black) and targeted the upper ceiling at $3.45. The next few sessions could be crucial for XTZ, as an extended bull run could push the price all the way to its August 2020 levels.

The Awesome Oscillator highlighted the strong shift of momentum towards the bullish side, as depicted by the green bars on the histogram.

The bullish momentum could perhaps be attributed to Tezos’ recent announcement related to its Homebase Project, a project that allows users to create DAOs on Tezos based on a new smart contracts framework.

On the other hand, the Stochastic RSI traded in the overbought zone and looked primed for a reversal. This indicated that further efforts by buyers would be required to maintain the price above its press time support.

Verge [XVG]

Source: XVG/USD, TradingView

At the time of writing, Verge traded at $0.012, up by 7.5% in the past 24 hours. The price broke above its previous resistance and headed towards the strong resistance line of $0.014. A northbound breakout from $0.014 could confirm an uptrend for XVG, but cues from the broader market would be needed to maintain such bullishness.

The Relative Strength Index was flat and rested in the neutral territory. If the index moves lower over the next few sessions, the price could move towards its latest support line once again.

On the flip side, the MACD witnessed a bullish crossover, signaling the onset of a potential bull run.

NANO

Source: NANO/USD, TradingView

NANO found support at $3.15 as the price seemed bullish over the last 24 hours. However, the bulls were unable to push the price above the resistance at $3.44 as the price settled close to its support level. Going forward, the price could consolidate between the aforementioned channels and an influx of additional buyers would be required for a northbound breakout over the coming days.

The Chaikin Money Flow highlighted the short-term bullishness for the cryptocurrency as the index looked to move above zero, a sign that capital was flowing into NANO.

The Parabolic SAR was also bullish as the dotted markers were observed below the candlesticks.

Source: https://eng.ambcrypto.com/tezos-verge-nano-price-analysis-23-january

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