Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities

Archives

Bitcoin Sell-Off Continues As It Approaches Its 2018 Lows

December 5, 2018 at 19:12 by Arathur Stephen

After being unable to stabilize above the important psychological price level of $4,000, the flagship cryptocurrency, Bitcoin (BTC) has continued to sell-off and is now approaching its 2018 lows. Bitcoin’s latest leg down has led to a widespread market drop that has seen many altcoins drop 3% or more over a 24-hour trading period.

Bitcoin Not on the Good List for a Santa Rally

At the time of writing, Bitcoin is trading down 4.65% in 24 hours at its current price of $3,786 at 19:00 GMT. Wednesday’s drop was not unexpected, due to the fact that it was unable to stabilize above $4,000, and was slowly pushed into the $3,900 region by the bears.

Despite the markets being incredibly weak presently, they could be nearing another good entry zone for traders looking to profit from a relief rally, and one analyst claims that there is more upside than downside. Jani Ziedens of CrackedMarket explained to MarketWatch:

Bitcoin continues flirting with the $4k level as it struggles to find its footing following the latest selloff. But given how far we fell, at this point there is more upside than downside. That said, few things move as far and as fast as cryptocurrencies.

Grayscale Owns $826 Million Worth of Bitcoin

Amid Bitcoin chaotic price action, falling ceaselessly and ascending through key levels, reports indicate that Grayscale’s growing war chest has continued to swell, while institutional players continue to express interest in crypto assets. This, of course, makes it more than palpable that institutions see immense value in cryptocurrencies, and potentially, that a market bottom is inbound.

According to a research report released on December 3, from the offices of crypto analytics unit Diar, Grayscale Investments, a self-acclaimed “trusted authority on digital currency investing,” has accumulated thousands of bitcoins for its in-house Bitcoin Investment Trust (GBTC).

Since the start of 2018, Grayscale, owned by Barry Silbert brainchild Digital Currency Group (DCG), has seen its BTC coffers swell by 30,600 bitcoins to 203,000 total, now accounting for more than 1% of the asset’s total circulating supply.

As the chart above shows (sourced from LongHash), the wallets pertaining to Grayscale’s GBTC, a vehicle that allows retail and investors to purchase BTC on the US OTC market has seen month-over-month increases. Diar wrote on the matter:

Record inflows however have resulted in record Bitcoin equivalent holdings with December notching up a little versus the start of the previous month.

Although GBTC’s user base also consists of retail investors, the steady rise in BTC holdings indicates that capital continues to flow into this market through trusted third parties (ironically enough), a plausible positive sign.

BTCUSD Technical Analysis

According to the chart, the BTCUSD pair is now in a sideways trend following the bearish candlestick of November 26. The price of Bitcoin dropped to the low of $3,786 and then commenced a range bound movement. The crypto’s price had been fluctuating around the $3,800 price level since November 26.

However, if the bulls break the 12-day Exponential Moving Averages (EMA), the 26-day EMA and stay above it, the Bitcoin will resume its uptrend.

Meanwhile, the crypto’s price is in a sideways trend as seen in the 4-hour chart. For some time now, the price of Bitcoin had been in a sideways trend. However, the bears broke the $4,000 price level on December 3, but the price was fluctuating between the $3,800 and $3,900 price levels.

From the 4-hour chart, the bulls broke the 12-day EMA nevertheless, they were resisted by the 26-day EMA. Moreover, the price of Bitcoin is below the 12-day EMA and the 26-day EMA which indicate that the price is likely to decline. The Stochastic indicator is in the range below 40% which shows that the BTCUSD has a bearish momentum and a sell signal.

Resistance levels: $4,400, $5,600, $6,000

Support levels: $3,600, $3,400, $3,200

If you have any questions and comments on Bitcoin today, use the form below to reply.

Leave a Reply

required
required  

Navigation

Menu