SURGE comes out on top after Bitcoin loses 13% in less than 24 hours

SURGE Technologies
Sep 7, 2018 · 3 min read

On Wednesday 6th September 2018 — the cryptocurrency markets saw one of its most deadly 24 hour declines of 2018, with markets shedding close to $38 billion from its total capitalization. In the case of Bitcoin — the digital asset went from $7,150 down to $6,400 in a catastrophic six hour period, illustrating a significant sell off across the board.

Over the course of the day, it was once again alt-coin holders that suffered the most — with the likes of Ethereum and Ripple losing close to 15%.

The downfall came as a surprise, especially taking in to account Bitcoin’s recent run of form. In fact, since the coin breached the all-important $6,000 support line in mid-August, it appeared that the bulls were potentially back in town. Moreover, the support line has acted as key resistance for the bears on multiple occasions, leaving many commentators to argue that the $6,000 level is crucial for Bitcoin to avoid a sustained free-fall.

Nevertheless, upon receiving support — the preceding three weeks saw Bitcoin make slow and steady gains. Until yesterday’s sudden decline, the cryptocurrency was held short just below the $7,400 level.

What caused the sudden drop?

It still remains to be seen what publication in particular caused the markets to react in such a negative manner — something that is often the case in ultra-sharp declines. For example, on August 8th — the last time the markets received significant fundamental news, Bitcoin lost just over 6% in a single day.

The news that sparked that downfall was in response to the Securities and Exchange Commission (SEC) postponing their much anticipated ETF decision. To illustrate just how irrational the cryptocurrency markets can be, the general consensus is that the postponement was nothing less than neutral — and certainly not negative per-say. However, that’s not how the markets saw it with the Bitcoin bears once again dominating proceedings.

It appears that the only potential factor that led to yesterday’s industry-wide decline was the news pertaining to Goldman Sachs’ decision to delay the launch of their impending Bitcoin trading desk. Upon closer scrutiny, the postponement isn’t a firm indication that the financial institution is turning their back on cryptocurrency in its entirety, more so that they are instead focusing their resources on institutional-style custodianship.

Custodianship — the act of securing digital assets such as Bitcoin at an institutional level, would allow large-scale investment houses to enter the cryptocurrency markets. Without it, no framework would be in place to facilitate significant investment from Wall Street.

Many argue that the Goldman Sachs press release was nothing more than a coincidence, especially when one considers the disparity between the neutrality of the story and the size of the decline. Instead, a more fitting reason might be due to the recent built up of selling pressure and a failure for trading volumes to outpace it.

Making gains no matter what way the markets go

As we at SURGE Technologies have previously discussed on many occasions, although we are confident that the overall cryptocurrency markets have limitless potential, we aim to make gains no matter which way the markets go.

We employ a range of trading strategies — utilizing the benefits of both human trading and algorithmic bot trading. To illustrate this effectiveness, our 24/7 bots were in full swing at the point of yesterday’s decline. Across a total of 9 individual trading accounts, our bots were able to profit from the downfall on all but one which lost a mere $50.

This is not only a great example of a highly complex bot being able to recognise market pressure and subsequently making highly accurate trades, but in the case of the bot that made a loss — it was able to effectively mitigate these loses by exiting at the right time. Bots can’t be right 100% of the time, but their ability to calculate thousands of independent scenarios per second gives them a significant chance of success.

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