Weekly analyst Paul Shipunov, head of analysis and research ICBF, told about the reasons of the collapse of the value of crypto-assets, and about when to expect a market reversal.
A long phase of the movement of bitcoin without any clear benchmarks, which we discussed in the last review, finally ended the panic sale of all cryptocurrencies, which confirms the screenshot below. But it’s already a success, it was the exit $6500−$6600, which has long hampered any attempt by the price movements up or down. But finally came the moment which suggests that awaited us began a powerful movement of the market. At the moment, and nothing happened beyond the broader limits of consolidation of prices $6000−$6800, so the latter remain relevant, and only their elimination will be a signal to send prices in either «deep basement», or «Tu ze moon».
Graphic display of the dynamics of the stock market in the moment on 11.08.2018. Source.
It’s time to deal with the causes of the current dynamics, comes really a lot of news. First, ongoing uncertainty with the means of Tether after the withdrawal of them from Noble Bank, also draw attention to alleged lack of funds and the problems associated with steilcoom exchange Bitfinex. In some feeds news resources began to appear rumors that the funds are now on Bitfinex accounts of one of the largest international banks HSBC, but this information has not received official confirmation. In favor of this idea can be noted that new users were offered when opening an account in US dollars to transfer funds to the accounts of the company Global Trading Solution LLC with the receiving Bank in the form of the American division of HSBC.
But this detective story could not simply end, and, exacerbating an already difficult situation, came the news of the temporary suspension of reception of deposits for one week in Fiat currencies such as US dollar, Euro and yen. Most likely, with the company Global Trading Solution was not agreed Deposit taking Bitfinex team, and an open account has been blocked. Then everything is logical: should worry about the safety of their funds, as in the case of the support the panic sale of bitcoin will continue. But whether they are safe if they converted to tezera, but not in other stabilini?
So suspended in the air remains the most interesting question, and is one of the top 3 among kryptomere the volume of daily trading Bitfinex solvent? Of course, the very financial institution declares its financial viability and to confirm this, presented reports on the movement of funds on the part of their wallets in bitcoin, esters and other means. But the stock market believed it poorly, which led to the reduction of capitalization to smooth the value of $200 billion, although the peak on 7 January this fiscal was higher than the $826 billion.
Dynamics of capitalization of the stock market in 2018. Source.
Secondly, it became popular again in the drama of SEC vs ETF bitcoin, which began to fade into the background and ceased to exert such a significant influence on the market, as it was in the time of the first failure in July. Recall that the original was filed 9 applications, including those with the strongest positions from the exchange Gimini and consolidated VanEck SolidX Bitcoin Trust ETF. Now this story is more reminiscent of a bad Comedy, because after a period of uncertainty with a new timing of the consideration this week there was «a new hope». The SEC commissioners announced a new collection of opinions from both supporters of the introduction of a new instrument for financial markets and the opponents, until October 26. And on November 5, officials of the regulator can vote based on new information. In case of approval, at least one of the proposed applications, the market will receive a powerful impetus for growth, because the most controversial, the regulator will give the stock market a «green light» to raise funds not only versed in the intricacies of the market traders or the big capital, but wishing to profit from ordinary investors. Thus, according to our estimates, in 2019, cryptosphere can attract several billion dollars. This news will give a positive signal to the market if approved, but the deviation of these applications can lead to the opposite effect, and quotes cryptocurrency go in search of new annual lows.
And the third news, which contributed to the devastating collapse of the stock market, was the news of the disastrous outcome of 2017 ICO. So, 46% of ICO not gathered the required level softcap for financing the project. But the majority brought together the necessary resources for development of the ICO was also unable to grow and eventually turned out to be unprofitable. According to other estimates, the total fees of all the projects have already been reached in September of $28.4 billion to the end of 2018 could potentially exceed $30 billion. Moreover, a large part of the funds received accounted for this year. But let’s in a barrel of tar with a description of the market situation the ICO will add a spoonful of honey. France, United Arab Emirates and South Korea are going to give the process the initial fundraising through the sale of tokens of legitimate legal status. Of course, that the raising of such amount of funds could not fail to arouse the interest of state regulators. In the future, expect such actions from other leading Central banks.
Dealt with market-moving news, it’s time to move to the schedules.
On the chart visible long-awaited major breakthrough down, although after the reduction stopped, and now continues to consolidate around $6300. The momentum for further movement will meet support at earlier levels oboznachaya $6000−$6111−$6200. As seen in the chart below, there was an exit below the rising trend line (marked in green) that when new negative news will lead to the disappointment of investors in the idea of further growth. A break below $6000 will be the basis for the conclusion even more shorts-deals with the first targets in the form of consolidation $5776−$5880 and $5600.
Chart BTC/USDT, day timeframe. Source.
Cancellation for this idea will become a powerful break above resistance $6820 and $7000, where now is the upper border of the technical indicator «Bollinger Bands». Overcoming them up seems an unlikely scenario, but we need to mark it. Care above $7000 will allow you to reach the neighborhood of $7200, which now passes the 200-day simple moving average and the consolidation of $7375−$7500−$7800.
Ethereum and other altcoins
Market altcoins follow bitcoin strove to conquer the minimum value, therefore, the most promising strategy seems to either be out of the market, or a small part of the Deposit to open short positions. Live confidently flew up and reached the support in the area of cluster $193−$200. Only a strong fall of bitcoin will be sent down and the price of the air. Potential targets in this case will perform consistently$180, $160, $144, $131 and $100. Alternative scenario with a growth of the second capitalization of the cryptocurrencies will start to develop under the condition of overcoming the level of $230 with the objectives of the $240, $251.
Schedule ETH/USD four-hour timeframe. Source.
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