BTC/USD

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November 8, 2024 Coin Telegraph

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Bitcoin price sell-off continues, but data highlights need for healthy correction

December 11, 2023 Coin Telegraph

4 things that can spark the next Bitcoin bull cycle

June 20, 2023 Coin Telegraph

Altcoins

Bitcoin is down 15% from its 2023-highs, but $40,000 may be closer than you think due to several important factors.

Bitcoin (BTC) has dropped nearly 15% from its yearly high of around $31,000, with the recent regulatory crackdowns on Coinbase and Binance crypto exchanges and the Federal Reserve's hawkish forward guidance accelerating its selloff.

Still, Bitcoin is up 60% year-to-date (YTD), holding above a technical support level of $25,000. Moreover, a new bull cycle can begin for a few reasons.

Bitcoin halving

The next Bitcoin halving, a pre-programmed event that slashes the cryptocurrency's supply rate by half every four years, is in April 2024.

The previous three Bitcoin halvings (2012, 2016, 2020) have all preceded massive BTC price rallies and new all-time highs. For instance, BTC is up 276% since the previous halving in May 2020.

*Bitcoin price performances since the last three halvings. Source: Glassnode*

The market will likely be in an accumulation zone until the halving, according to analyst Lark Davis, who anticipates Bitcoin to test its record high of $69,000 in the next 18-24 months. One analyst even sees the price hitting $160,000 by April 2024.

Volatility, volumes, and realized values are at multi-year lows, indicating that Bitcoin investor apathy is firmly in play.

However, under the surface, HODLers continue their classic slow and steady accumulation, with the halving now less than 1yr away.

To find our more,… pic.twitter.com/1w2gMTRWCC
— glassnode (@glassnode) June 19, 2023

BlackRock Bitcoin ETF

BlackRock's Bitcoin ETF application to the U.S. Securities and Exchange Commission (SEC) has also boosted confidence in a potential BTC price rally in the days leading up to the halving.

The investment firm, which manages $8.5 trillion in assets, has a near-perfect ETF approval record with the SEC. The SEC's deadline to respond to BlackRock's application is around March 2024, a month before the halving.

An SEC approval may double Bitcoin's bullish prospects post-halving, several analysts argue.

"Your are watching game theory at work," analyst Crypto Tea states, noting:

"BlackRock understands the bitcoin halving is less than a year away. New supply will decrease while demand continues to increase from worldwide hyperinflation. They are asset managers and need to capture Bitcoin's performance before their competitors do."

Bitcoin dominance rising

The latest SEC crackdown on crypto exchanges Binance and Coinbase has left many top altcoins under stress, particularly those deemed "unregistered securities." That has coincided with the Bitcoin's crypto market dominance crossing 50% for the first time in two years.

*Bitcoin market dominance index. Source: TradingView*

In other words, capital is moving from altcoins to Bitcoin as the latter is not considered a "security" by the SEC. Therefore, BTC may be seen as the "safe" bet when compared to the 60+ cryptocurrencies deemed "securities" by the regulator.

MicroStrategy cofounder Michael Saylor predicts this will push BTC's market cap to 80% of the total crypto market in the coming years. He said:

"Regulatory clarity is going to drive Bitcoin adoption by eliminating the confusion & anxiety that has been holding back institutional investors. Bitcoin dominance will continue to grow as the #Crypto industry rationalizes around $BTC and goes mainstream."

BTC price "bull flag"

Technicals show Bitcoin painting a clear bull flag pattern on its longer-timeframe (LTF) charts, suggesting an upside continuation of its overall recovery rally.

*BTC/USD weekly price chart. Source: TradingView*

A bull flag gets resolved after the price breaks above its upper trendline and rises by as much as the height of the previous uptrend. As a result, Bitcoin's bull flag target comes near $35,500 — a level that was strong support in May 2021 and May 2022.

Still, Bitcoin will need to close decisively above $35,500 to begin a bull cycle, given it would still be a lower high compared to the cryptocurrency's previous bear market peaks.

Interestingly (and simultaneously to the bull flag pattern), BTC price could be on the cusp of a breakout in its prevailing inverse-head-and-shoulders (IH&S) pattern, as shown below.

An IH&S is a bullish reversal pattern, confirmed by the formation of three troughs under a common neckline resistance. The middle trough comes to be deeper than the other two, which have more or less the same height.

As a rule, an IH&S pattern is resolved after the price breaks above the neckline and rises by as much as the distance between the middle trough's lowest point and the neckline. Sometime, the price returns to retest the neckline as support after the first breakout attempt.

Thus, a rebound from the IH&S neckline could have BTC price rally toward $40,500, up more than 60% from current price levels, and confirming a new bull cycle.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Why is Bitcoin price stuck?

May 22, 2023 Coin Telegraph

Analysis

Bitcoin is a volatile asset but BTC price can get stuck inside narrow trading ranges for week, if not months for multiple reasons.

Bitcoin (BTC) continues with its sideways BTC price action under $27,000 on May 22 as the bulls and bears find it hard to break the stalemate.

Which way Bitcoin?

Notably, BTC price has fluctuated inside a narrowing ascending triangle range since May 11, defined by a horizontal resistance around $27,500 and a rising trendline support currently near $26,890.

*BTC/USD four-hour price chart. Source: TradingView*

On May 22, Bitcoin dropped below the support trendline to around $26,550 but recovered quickly afterward to $26,900 — a bullish rejection. Meanwhile, the volumes were relatively lower, suggesting fewer traders participated in the intraday dump-and-pump move.

Overall, these technicals illustrate an ongoing bias conflict among traders. In other words, they are unsure about the direction of Bitcoin's next price trend with the same amount of buyers and sellers — something that derivatives are also hinting at.

Why is BTC price not moving?

Flat price action in the Bitcoin market can precede periods of extreme price volatility, triggered by big events.

For instance, Bitcoin fluctuated in the $16,000-17,500 range between Nov. 9, 2022, and Jan. 10. 2023, right in the aftermath of the FTX crypto exchange's collapse. The price attempted to break above and below the range on some days but failed to establish a recovery trend.

The market witnessed a similar flat trend after the sharp BTC price decline led by the collapse of Terra in May 2022. Notably, BTC/USD traded inside the $28,000-30,000 range for almost a month before entering a decisive breakdown stage.

*BTC/USD daily price chart. Source: TradingView*

Bitcoin's flat trajectory in May 2023 has followed the U.S. banking crisis rally two months ago with numerous failed attempts to cross above $30,000, a psychological resistance level.

In other words, Bitcoin traders are waiting for a potential market trigger once again that could decisively push BTC price in either direction.

One major potential event will be the Federal Reserve's decision on interest rates next month.

Currently, the conflicting outlook on raising interest rates is likely the main factor behind the sideways action of the stocks, including risk assets and cryptocurrencies. In fact, BTC price has seen one of its least-volatile periods since April, historic volatility data shows.

*Bitcoin 30-day price volatility after influential events. Source: BuyBitcoinWorldwide.com*

What's next for BTC price in the short term?

Technicals meanwhile show that a potential breakout above its 50-day exponential moving average (50-day EMA; the red wave) around $27,580 is in play.

If this happens, BTC price may once again retest the important $30,000-resistance level, where a rejection will be highly-probable upon first attempt.

Conversely, a pullback from the 50-day EMA would put BTC price en route toward the next big support level for a potential bounce at its 200-day EMA (the blue wave) near $25,000.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Warren Buffett dumps $13.3B in stocks — A warning sign for Bitcoin and risk-assets?

May 9, 2023 Coin Telegraph

Warren Buffett dumps .3B in stocks — A warning sign for Bitcoin and risk-assets?

Banking Crisis

The "Oracle of Omaha" has increased Berkshire Hathaway's cash holdings by $2 billion in Q1, signaling his decreasing confidence in risk-assets.

Warren Buffett moving into cash suggests that he's bracing for a possible collapse in risk-on asset prices. With Bitcoin (BTC) up 70% year-to-date and correlated with equities, should BTC investors also prepare for a potential stock market crash?

Buffett says "incredible period" is over

Warren Buffett's Berkshire Hathaway dumped $13.30 billion worth of equities and increased exposure in cash and U.S. Treasuries in Q1, its latest quarterly earnings report shows. Meanwhile, it channeled $4.4 billion toward purchasing its own stock and $2.9 billion on the shares of other publicly-traded companies.

The market considers Berkshire Hathaway's performance as a key indicator to gauge the U.S. economy's health, given the firm's holdings range from American railroad to electric utilities and retail businesses.

But the 92-year old investor, who has credited the U.S. economy's growth for the success of Berkshire Hathaway in the past, is no longer optimistic.

“The majority of our businesses will report lower earnings this year than last year,” Buffett said last weekend at an event. The “incredible period” for the US economy has been coming to an end over the past six months, he added.

Berkshire raised its cash reserves by $2 billion to $130.60 billion in Q1/2023, the highest level since the end of 2021 when equities entered a bear cycle. Moreover, the firm holds a vast amount of its cash in short-term Treasury bills and bank deposits thanks to higher interest rates near 5%.

In other words, Buffett is preparing for a potential stock market crash, particularly as the U.S. banking crisis continues to unfold (e.g. PacWest Bancorp and Western Alliance Bancorp) .

Bitcoin price stays correlated with Nasdaq

The increasing possibility of a global recession also risks putting downside pressure on Bitcoin, whose 100-week correlation with the Nasdaq reached its highest level of about 0.42%.

Moreover, Bloomberg Intelligence analyst Mike McGlone expects that BTC price would likely be the leading indicator for a stock crash.

"Bitcoin could pace declines for risk assets — If the worst isn't over for risk assets, Bitcoin may lead the way lower," noted McGlone, adding:

"Bitcoin is up about 70% in 2023 to May 2 vs. 20% for the stock index, and those are maybe bounces within broader bear markets. The Fed [is] still tightening in May, and [is] more inclined to stay the course unless risk assets fall to ease inflation, may portend a lose-lose."

In the short term, there are little expectations from the U.S. consumer price index report on May 10 about easing inflation in April. According to Bloomberg’s survey, economists expect core CPI to remain unchanged at around 5%, meaning more rate hikes ahead.

On the other hand, a big drop in inflation will likely prompt the Fed to consider pausing or even slashing interest rates in an extreme case scenario.

Currently, Fed funds futures' data suggests that at least five rate cuts between May 2023 and January 2024 are likely — something which may pour cold water on Buffett's risk-off strategy.

*Fed funds rate projections. Source: Bloomberg*

Could Bitcoin price fall below $25K again?

Bitcoin's price has declined roughly 6% over the past week, trading for as low as $27,350 on May 9.

Notably, this has pulled BTC's price the below its 50-day exponential moving average (50-day EMA; the red wave) near $27,950.

Bitcoin bears are now eyeing $27,000 as the next downside target based on the level's recent history.

A decisive break below the $27,000 support, primarily in the event of further rate hikes, could then pull down BTC/USD down to its 200-day EMA (the blue wave) near $24,600. In other words, a 10% drop by June.

Conversely, a rebound from $27,000 increases the possibility of BTC price retesting $30,000 as resistance, and to resume the uptrend of the last few months.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Ethereum price lower highs vs. Bitcoin hint at more downside in April

April 24, 2023 Coin Telegraph

Bitcoin

Institutional investors accumulated Ether and sold off Bitcoin last week, suggesting confidence in Ethereum after the Shapella hard fork.

The price of Ethereum's Ether (ETH) token has retreated from its recovery trend versus Bitcoin (BTC) while making a series of lower highs in April.

ETH price risks more losses vs. Bitcoin

As of April 24, the ETH/BTC pair was down about 5.5% from its local high of 0.0709 BTC six days ago. The same period witnessed Ether declining nearly 15% and Bitcoin dropping 11.25% in U.S. dollar terms.

*ETH/BTC daily price chart. Source: TradingView*

For now, ETH holds above its 50-day exponential moving average (50-day EMA; the red wave) near 0.0672 BTC. But if the March 2023 fractal is any indication, Ethereum's price could drop sharply below the support wave.

The ETH/BTC pair saw a pullback trend in March after testing the 200-day EMA (the blue wave), breaking below its 50-day EMA in the process.

If the fractal plays out similarly in April, the downside target is 0.0627 BTC by the month's end, about 7% lower than the current levels, and a level that served as major support in March and April.

This target also coincides with Ether's long-term ascending trendline support — the "buy zone" in the chart below — that has been capping its bearish attempts since June 2022.

*ETH/BTC three-day price chart. Source: TradingView*

Weekly Ethereum institutional flows beat BTC

Interestingly, Ethereum's underperformance versus Bitcoin was counter to institutional flows for the past week.

Ethereum funds attracted $17 million to their coffers in the week ending April 21 versus Bitcoin's $53.1 million outflow, according to CoinShares' latest report.

*Fund flow into crypto funds. Source: CoinShares*

"These inflows suggest there is increasing confidence amongst investors following the successful implementation of the Shapella upgrade," James Butterfill, head of research at CoinShares, noted, adding that they "were solely from Europe."

As for Bitcoin, the outflow began around April 14 when the coin reached $30,000, a psychological resistance level. Butterfill said the BTC's drop to below $27,500 resulted from profit-taking in the absence of macroeconomic triggers.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

MicroStrategy stock price more than doubles in 2023 in lockstep with Bitcoin

April 18, 2023 Coin Telegraph

Bank of America

Bank of America and Fidelity have increased their MicroStrategy exposure in what appears to be a passive Bitcoin investment.

MicroStrategy's infamous Bitcoin (BTC) investment strategy is playing out profitably so far into 2023.

Today, MicroStrategy's stock MSTR is up roughly 140% year-to-date (YTD) to $350 per share, its highest level since September last year. It mirrored Bitcoin's 90% YTD gains, maintaining a strong positive correlation with the top cryptocurrency.

*MSTR daily price chart featuring its daily correlation with BTC. Source: TradingView*

Proxy Bitcoin investment boom

To recap, MicroStrategy is essentially a proxy for direct BTC investment without a spot Bitcoin exchange-traded fund (ETF) in the U.S. It holds 140,000 BTC worth $4.26 billion, the most by a publicly-traded company as a part of its Treasury strategy.

MSTR investors typically get their buying or selling cues from the same catalysts that drive Bitcoin market trends.

As a result, the stock has mirrored the BTC price uptrend so far in 2023, led by rush-to-safety trades amid the U.S. banking crisis and anticipation the Federal Reserve would stop hiking rates.

For instance, CNN data shows Bank of America's entities owns 86,147 MSTR shares. Similarly, Fidelity purchased 97,199 MSTR shares throughout 2022, suggesting growing institutional interest in proxy Bitcoin investments.

Coinbase's COIN, another stock offering indirect crypto exposure, has doubled in value this year as well.

MicroStrategy's core business is unhealthy

MicroStrategy is essentially an enterprise software solution company and generates its revenue from software licensing and subscription services.

The firm realized a net loss of $193.7 million during Q4/2022, up from $137.5 million a year ago, led by a Bitcoin impairment loss of $197.6 million. Furthermore, its operating cash flow was $18.2 million compared to a positive cash flow of $3.2 million in the same quarter a year ago.

Revenue isn't what you're making it out to be. If a lemonade stand does $100M in revenue and spends $99,999,999 to generate that revenue, then a $1.00 profit isn't all that amazing.

Microstrategy isnt far from that example. Their expense to generate that revenue leaves them with… pic.twitter.com/ZhA80tWn3J
— Alby (@albyva) April 2, 2023

Of course, MicroStrategy could sell its Bitcoin holdings to boost its balance sheet reserves. But the company says it will not alter its BTC buying strategy under financial stress. Instead, it employs strategies like share dilutions and debt offerings to raise capital to buy BTC.

"The risk here will come from its inability to buy Bitcoin with positive cash flows in future quarters as per its strategy," says Pacifica Yield, financial blogger at Seeking Alpha, adding:

"Dilution to buy assets that you lose money on if Bitcoin returns to its near-term lows would not be a shareholder-friendly strategy."

20% correction for MSTR stock in Q2?

From a technical standpoint, MSTR has a high probability of a 20% price correction in Q2.

The stock's yearly rally has landed its price near a resistance range — between $320 and $340 — notorious for capping breakout attempts. Suppose a pullback occurs. Then, the price could drop toward its 50-3D exponential moving average (50-3D EMA; the red wave) below $260 by June.

*MSTR three-day price chart. Source: TradingView*

MicroStrategy is expected to release its Q1 earnings report by May 2.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Ethereum is up 15% versus Bitcoin since Shapella — More ETH price gains ahead?

April 18, 2023 Coin Telegraph

Bitcoin Price

Ether stakers have withdrawn $1.21 billion worth of ETH from Ethereum staking contracts since the Shapella upgrade.

Ethereum's Ether (ETH) token has entered a sharp price recovery a week after hitting a six-month low versus Bitcoin (BTC).

On April 18, the widely-tracked ETH/BTC pair reached 0.0709 BTC, up about 15% from its local bottom of 0.0602 BTC six days ago. Now, the pair eyes a run-up toward 0.075 BTC by June, based on the fractal setup previously discussed here.

Ethereum's Shapella FOMO

Interestingly, Ether's local bottom formation versus Bitcoin occurred on the day of Ethereum's long-awaited Shapella upgrade.

The hard fork enables Ether stakers to withdraw their rewards — around 1.1 billion ETH — from Ethereum's proof-of-stake smart contract. This update may have boosted ETH's appeal compared to BTC, beating anticipations that a freshly unlocked Ether supply would increase sell-pressure.

Stakers have withdrawn 574,700 ETH — worth about $1.21 billion — since the Shapella upgrade on April 12, according to data fetched by Nansen. Interestingly, Ether's price in U.S. dollar terms has increased by 14.25% in the same period.

*ETH deposits vs. withdrawals. Source: Nansen*

It means that many stakers have decided to hold onto their Ether rewards. On the other hand, Bitcoin has failed to log a decisive breakout above its technical resistance of $30,000, possibly making ETH a more attractive short-term bet for traders.

Weak institutional inflows versus Bitcoin

Institutional investors have shown more interest in Bitcoin than Ether in the past week, according to CoinShares' weekly report.

For instance, Bitcoin-based investment vehicles witnessed $103.8 million in inflows in the week ending April 14. In comparison, Ethereum funds attracted $300,000 only, showing that mainstream investors may have followed the "sell the news" strategy after the Shapella upgrade.

*Net flows into crypto funds. Source: CoinShares*

Ethereum price meanwhile is also at risk of a possible bearish reversal move due to its overbought daily relative strength index (RSI).

If ETH price retreats from its current resistance level of around $2,140, its immediate downside target appears at around $1,984, which acted as resistance in May 2022 and August 2022.

*ETH/USD daily price chart. Source: TradingView*

An extended selloff could push Ether price down to its 50-day exponential moving average (50-day EMA; the red wave) near $1,800, down about 15% than its current price levels.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Bitcoin halving

BlackRock Bitcoin ETF

Bitcoin dominance rising

BTC price "bull flag"

Which way Bitcoin?

Why is BTC price not moving?

What's next for BTC price in the short term?

Buffett says "incredible period" is over

Bitcoin price stays correlated with Nasdaq

Could Bitcoin price fall below $25K again?

ETH price risks more losses vs. Bitcoin

Weekly Ethereum institutional flows beat BTC

Proxy Bitcoin investment boom

MicroStrategy's core business is unhealthy

20% correction for MSTR stock in Q2?

Ethereum's Shapella FOMO

Weak institutional inflows versus Bitcoin

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