Crypto Investor Report, September 3
Summary
Bitcoin keeps respecting the descending triangle formation, clearly observable in the daily charts. For now, it has been ranging back and forth between its lower and upper edge, without any relevant pierce through it.
While the bearish retracement scenario is favoured in odds, bulls still have a chance to win this scenario of increased choppiness. Nevertheless, recent price action already wore down some of their defences and a plausible movement upwards will probably turn out to be more of a correction than of a fresh impulse, unless investors massively agree and act on that movement.
Volume has hit lower figures only seen several months ago. Bitcoin’s hash rate has set a new high record. Its dominance has pierced the 70% threshold and is still moving up, squeezing all other coins in the process. More exchanges opening and offering more sophisticated instruments and tools. Institutionals sneaking in, and major companies embracing and adopting blockchain technologies. All key ingredients that will definitely give major excitement for the markets in the upcoming months and tail the fate of some projects.
In the Spotlight
- Bitcoin’s blockchain produced new historic records this week
- Bitcoin’s dominance hits 70%
- Portugal tax authority does not plan to tax Bitcoin transactions
- Venezuela’s Bitcoin trading explodes amid alleged anti-Maduro plot
- HSBC completes first Blockchain letter of a credit transaction in Yuan
- VanEck, SolidX to offer Bitcoin ETF to Institutions via SEC Exemption
- Bitcoin.com has announced the launch of its crypto-exchange
- Binance launches two crypto futures platforms for user testing
- Bitfinex’s 100x leverage derivatives now available
Market Overview
The total capitalization of the cryptocurrency markets has raised, during the past week, from $265 Bn up to $270 Bn, a 1.90% weekly appreciation. The average daily traded volume dropped to the $40–45 Bn range during most of the past seven days, recovering some strength after the latest push on the Bitcoin’s price.
After a slight decline in the past weeks, with Bitcoin’s dominance ranging in the 68–70% levels, it finally surpassed the 70% resistance. At the time this report is been written, Bitcoin’s dominance stands at 70.45%, with a slight momentum pointing upwards.
Looking into the top digital assets, those with over $400 Mn of market capitalization, we see a major discrepancy in the weekly performance between Bitcoin and all the remaining altcoins.
Bitcoin (BTC) had a positive performance, gaining over 5% in a seven-day period to trade, at this moment, at near $10,700. Bitcoin Cash SV (BSV), with 1.37% of weekly gains was the other exception in this top listing, trading now at $135.57.
Cosmos (ATOM), Chainlink (LINK) and Binance Coin (BNB) were the top underperformers of the week. While the first lost over 15% to be trading now at $2.17, LINK is losing 12.15% and trading at $1.85. BNB is down 11.32% and trading at $22.69.
Regarding the top-20 listing by market capitalization, some permutations in the ordered ranking. Monero (XMR) took Stellar’s (XLM) 9th place, and Dash (DASH) was overtaken by Ethereum Classic (ETC) in the 13th place. Tezos (XTZ) also lost his 15th position to IOTA (MIOTA), and NEM (XEM) overtook Cosmos (ATOM) in the 18th position.
The number of assets with over $1 Billion of market capitalization is still fixed on twelve, with TRON (TRX) bottoming that list. Ontology (ONT), in the 20th place, has seen its market capitalization dropping below $400 Mn.
Bitcoin Market Analysis
Looking into the daily charts for Bitcoin, we have seen further confirmations on the descending triangle pattern. These consolidation figures have a greater chance to break to the downside and, by our recent collective memory, we might recall the setup that we all experienced twelve months ago. By then, the resolution was downwards and brought Bitcoin prices from $6k down to $3k.
The remark to be taken here is that the chart has turned slightly into a more bearish construction. Nevertheless, the tails of the week have respected the candle body lows at $9,400 and therefore — technically speaking — the bull scenario could also be still in play.
The setback conjecture on that play has to be brought into mind: the bulls have suffered some serious adversities recently, and have their chances of winning this consolidation diminished.
As the triangle pattern has its vertex in October of 2019, it means we might spend the next weeks still oscillating back and forth between its edges, before actually reaching a resolution. Unless FOMO or FUD kicks in.
Now, let’s gain some finer perspective and zoom in the charts to focus on the key areas.
The weekly chart remains pretty neutral. The 38.2 Fibonacci level provides some clear support but the breakout targets remain the same above and below.
The daily chart clearly pinpoints the main challenge areas for the bulls. The $10,800-$11,000 region brings together the previous highs along with the upper boundary of the descending triangle.
Stay above these levels and expect some joyful reaction from the bulls. Rejection on the upper edge would keep the game unbalanced in favour of the bears.
If we also zoom-in on the intraday charts, we observe that the recent price action has penetrated both the heavy red cloud and the Daily EMA21. The general impression is that Bitcoin is feeling quite heavy, and the bounce from $9,400 is (still) looking more like a correction than as a fresh impulse.
Important Note: The information provided on this post has been prepared solely for informational purposes and should not be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any security or instrument or to participate in any transaction or trading activity. The contents are based upon or derived from information generally believed to be reliable although no representation is made that it is accurate or complete and Obvious Capital accepts no liability with regard to the user’s reliance on it.
