Cryptocurrency Analysis

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Technical Analysis of BTC/USD for August 18, 2021

Crypto Industry News:
Regulators around the world continue to put pressure on crypto companies. The Spanish National Securities Markets Commission (CNMV) has issued a warning regarding several cryptocurrency and financial market related companies for offering unregistered services.

According to the official document, the CNMV warned 12 entities that they were not registered with the relevant commission register. The listed entities, which include leading cryptocurrency trading platforms such as Huobi and Bybit, are not allowed to provide investment services in Spain.

The consulting site of CNMV states that only registered companies are authorized to provide securities related services. While the securities regulator does not have the power to directly prohibit an entity from operating in the country, the CNMV may appeal to a court. The July Crypto Company Guide report in Spain revealed that around 120 crypto companies are already registered and operating in Spain.

Spain created a rather friendly environment for crypto companies last year. The Committee on Economy and Digital Transformation approved the law to create a sandbox for financial technologies.


Technical Market Outlook:
The BTC/USD pair has made a new local low at the level of $44,162 as the pull-back deepens. The market is still trades inside of the ascending channel, but please keep an eye on the level of $43,686 because any violation would be negative for bulls and could deepen the correction out of the channel. The immediate technical resistance is seen at the level of $45,043 and $45,710.

Weekly Pivot Points:
WR3 - $54,673
WR2 - $51,130
WR1 - $49,247

Weekly Pivot - $46,037
WS1 - $43,891
WS2 - $45,515
WS3 - $38,510


Trading Outlook:
The bulls are still in control of the Bitcoin market, so the up trend continues and the next long term target for Bitcoin is seen at the level of $70,000. The next mid-term target is seen at the level of $47,000. This scenario is valid as long as the level of $30,000 is clearly broken on the daily time frame chart (daily candle close below $30k).







Sebastian Seliga
Analytical expert
InstaFintech Group © 2007-2021

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SEC and CFTC will sit down at the negotiating table with market participants



Bitcoin has worked out the $47,500 level several times over the past few days and bounced off it twice. Thus, for the time being, we can conclude that this level is too tough for buyers. In principle, "digital gold" has already risen in price very well in recent weeks even without overcoming this level. There were no visible and compelling reasons for the growth of bitcoin by $18,000. We believe that market participants, after the repression of miners in China, as well as the serious tightening of local legislation on the regulation of the cryptocurrency sphere, were afraid that legislation, in particular tax, would also be tightened in the United States. Ergo, they hurried to buy bitcoin coins before this happened. However, based on this factor, it is impossible to grow forever. Now, since the 50.0% Fibonacci level of $47,500 has not been overcome, we are waiting for a new prolonged drop in bitcoin quotes.

In the United States, Congressman Patrick McHenry and Congressman Glenn Thompson opposed the introduction of new legislation that encourages the creation of new jobs abroad, as well as suppresses innovation. These congressmen believed that the US Securities and Exchange Commission, as well as the Commission on Futures Trading Commission should not be given additional powers, since they may entail long-term consequences. Earlier, the head of the SEC, Gary Gensler, said that his organization could strengthen the regulation of DeFi and stablecoins. Congressman Patrick McHenry and Congressman Glenn Thompson invite representatives of the SEC and CFTC to sit down at the negotiating table with representatives of the digital asset market. According to McHenry and Thompson, this is the only way to achieve the prosperity of the digital asset market in the United States.

However, one potential problem for cryptocurrency investors is still looming on the horizon. And this problem is the new tax legislation in the United States, according to which almost every participant of the cryptocurrency market falls under the concept of "broker", which, according to experts, can seriously reduce the demand for cryptocurrencies. Or to provoke an outflow of investments abroad, to those countries where tax rates are lower or even absent. That is, the United States risks getting the same situation as with business. Since taxes are high in the United States, many companies have moved their business or its individual divisions to other countries where taxes are lower. It can also be the same with the cryptocurrency sphere. Why stay in the United States, buy bitcoin there, and pay the Tax Service, if you can buy bitcoin from anywhere in the world and not pay any taxes at the same time?



Technically, bitcoin continues to be in an upward movement on the daily timeframe and has twice worked out the level of $47,500, which is the minimum of April 26, as well as 50% of the movement from the absolute maximum of the value to the minimum of 2021. The quotes of bitcoin left the side expanding channel, but the confidence in its further growth did not become any more. Before overcoming the level of $47,500, we are again considering the option of falling to $29,700 or lower.





Paolo Greco
Analytical expert
InstaFintech Group © 2007-2021

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Ethereum's top 5 reasons why it can dominate the crypto market



Ethereum is currently trading at a price of $ 3175 and is the second-largest cryptocurrency by capitalization. What are the main reasons for the dominance of this cryptocurrency?

A completely new type of communication
Applications that are based on Ethereum can have a significant impact on various public services. It will be possible to use the platform for trading derivatives or securities in the near future. Ethereum focuses on an unprecedented new level of innovation, which makes this network incredibly valuable. The Ethereum network is constantly being scaled and improved, as it is backed by a huge number of high-class developers and an extensive user base.


Proof-of-Stake Model
The creator of Ethereum, Vitalik Buterin, promised to switch to the Proof-of-Stake model at the end of this year, which is also referred to as Ethereum 2.0, where the reward system will be completely redesigned. In this model, miners will be replaced by transaction validators, which in turn, will lead to the fact that you will no longer have to face and solve various cryptographic problems. With the launch of the Ethereum 2.0 model, the main altcoin can surge to incredible heights and play the most significant role in the global financial digital system, as well as be more environmentally friendly compared to Bitcoin.


Speed and scalability
Here, the main altcoin also differs from digital gold, and there are 2 key indicators for this. The Ethereum transaction will be displayed in about 4-5 minutes, and in order to conduct a Bitcoin transaction, the user will need about 35-40 minutes on average. For Bitcoin, the main priority is security, which leads to the fact that the speed of the transaction significantly decreases.

The coding language makes it difficult to crack the blockchain, but the speed suffers, and the new Proof-of-Stake update will provide users with the fastest possible opportunity to conduct transactions. According to many sources, the throughput of Proof-of-Stake will reach 15,000 transactions per second. This can put Ethereum on the scales with absolutely any centralized payment system when it comes to the speed of transactions.


Unlimited stock
Many people consider Bitcoin as an accumulative asset and protection against inflation, but Bitcoin has limited reserves, which are estimated at 21 million cryptomonets. Meanwhile, the main altcoin has an unlimited number of tokens. However, there are annual norms for the amount of Ethereum that is extracted during mining.


Independence from Bitcoin
At the moment, investors no longer see the connection of bitcoin Ethereum and there is no longer a correlation in the market when Bitcoin rises or falls and pulls Ethereum with it. In 2020, the correlation between Bitcoin and Ethereum was only 0.95. At the moment, the price of bitcoin is not the key point in determining the price of Ethereum.





Vitaly Kolesnikov
Analytical expert
InstaFintech Group © 2007-2021

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Bitcoin comes back to retest buyers

At the time of writing, bitcoin was dropping after failing to resume its upwards movement. It was traded at 45,501. Actually, it moved somehow sideways in the short term. Technically, it has shown some overbought signals, so a temporary decline is natural.

The outlook is still bullish, so we don't have to worry too much. BTC/USD could decline to retest some support levels before jumping higher. The current decline could help us to catch a new upward movement.

Bitcoin has dropped by around 1.82% in the last 24 hours, losing $843.38, but it's still up by 0.06% in the last 7 days. The trading volume decreased by 2.35% in the last 24 hours, while its market cap dropped by 1.87%.


BTC/USD TEMPORARY DECLINE


Bitcoin failed to approach and reach the channel's upside line. Now it may come back down towards the uptrend line. Also, the weekly S1 (43,843.07) is seen as a downside target.

Its incapacity to stabilize above the weekly pivot point (46,026.27) signaled strong selling pressure in the short term. This bearish momentum could be only a temporary one. The bias is still bullish as long as bitcoin stays above the uptrend line.

Bitcoin could resume its growth within the ascending channel's body. A bullish pattern around the S1 or printed on the uptrend line could signal a new leg higher. Also, failing to reach the support levels and coming back above the weekly pivot point 46,026.27 may signal upside continuation.

Only a valid breakdown below the uptrend line could invalidate the upside scenario and could signal a broader decline.


OUTLOOK
BTC/USD could resume its decline if it stabilizes under the pivot point and if it makes a new lower low to drop and close below 45,260.01. The confluence area formed at the intersection between the uptrend line with the weekly S1 (43,843.07) could attract the price.

A false breakout with great separation, a pin bar, or a major bullish engulfing pattern printed on these support levels could bring a new long opportunity.





Ralph Shedler
Analytical expert
InstaFintech Group © 2007-2021

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Bitcoin vulnerable to a move towards $42,000.

Bitcoin remains in a short-term bullish trend. Price continues making higher highs and higher lows. However as we mentioned in a previous post, the RSI is providing us with some bearish divergence signals implying that a pull back is imminent.



Black lines - Bearish divergence

Red line - support

Blue line - horizontal support

Bitcoin has most probably made a short-term top at $48,042. Price is turning lower and I expect to see at least a pull back towards the red upward sloping trend line. My most probable pull back target is the blue horizontal support line around $42,000. I expect Bitcoin to make a higher low around $42,000 or lower before continuing its up trend. Resistance is important at $47,100 and if broken we could see a new higher high above $48,042.





Alexandros Yfantis
Analytical expert
InstaFintech Group © 2007-2021

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Will bitcoin repeat the 2020 bull rally before the end of the year?

The third quarter is in full swing, the fourth is not far off. In 2020, October was the month after which a rapid rally began, raising bitcoin from $10,000 to $64,000. Based on the current picture, can we predict whether the same sharp momentum will be repeated by the end of the year as in 2020?

Here it is worth remembering all the forecasts for the growth of the main cryptocurrency to $100,000 and above. Which may not be baseless.

But Pete Humiston, manager of Kraken Intelligence Research, notes that the situation with bitcoin in the third quarter of 2021 is still significantly different from what it was in the fourth quarter of 2020.

Despite the fact that bitcoin has grown from $29,000 to $48,000 in just one month, there is still no buying rush in relation to it.

Humiston argues that you can verify this by looking at the Grayscale Bitcoin Trust (GBTC). It continues to trade at a discount of around 13% to the spot price this week. Demand seems to be growing slowly. As a result, we will probably see this discount disappear, as market participants seize the opportunity to get bitcoins at a discount, the expert notes.

Two other factors characterize the current structure of the bitcoin market: low open interest in BTC futures and lower than expected funding rates. Both are in contrast to the start of the 2020 bullish trend and are at odds with trends given the pace of price increases over the past month.

"During the time that bitcoin rose from 30,000 to 48,000, open interest fell. Nobody actually saw a massive BTC rally, which came as a surprise and not entirely normal," writes Pete Humiston.

Well, 100,000 for one bitcoin may not be worth it yet. But there is still time until the end of the year. And in the market, you know, anything can happen, especially if the deal is about bitcoin.

Although such a rally is probably not really necessary if you trade the market slowly, moving in short dips. In this case, bitcoin is very technical, and the next key milestones are quite clear. While there is a correction in the local range 44,807.24 - 48,178.13 between the two red dotted lines, it is worth waiting for a likely reversal from its support, and after that - either consolidation or a breakout and growth to 50,000-52,000.

And finally, some news from influencers:

Mike Novogratz's Galaxy Digital filed with the SEC to open a bitcoin futures ETF under the Investment Company Act of 1940.

Galaxy Digital has previously applied for a spot bitcoin ETF but has not been approved.

Notably, the company led by Mike Novogratz, which as of June 30, 2021, boasts $1.42 billion in assets under management, will not invest directly in bitcoin, but in bitcoin futures and other investment instruments.

This move is logical after the chairman of the US Securities and Exchange Commission Gary Gensler just a few weeks ago announced the preference of the regulator - futures on BTC, rather than spot bitcoin.

In the weeks following these comments, applications for ETF approval on Bitcoin Futures came from a number of funds. These included VanEck, Invesco, Goldman Sachs, Grayscale Bitcoin Trust, and Viridi Funds.







Ekaterina Kiseleva
Analytical expert
InstaFintech Group © 2007-2021

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Bitcoin can break the downward cycle or fall due to a correction: what is most likely to happen?

Bitcoin continues to move around the $48,000 mark, where the key resistance zone of the entire bearish trend passes. The cryptocurrency was approaching a difficult selling area but bounced back to the upper border of the support zone. As of 14:00 UTC, the asset continues to consolidate around $46,400. The coin steadily approached the long-term resistance zone, forming two highs at $46,200 and $37,300. However, bitcoin subsequently created another rally high at $48,200. The current price rebound will likely be the reason for a local correction with claims for a breakdown of the main growth range.

The market correction at this stage is quite logical and occurs within the upward trend from July 20. The cryptocurrency touched and bounced off the long-term downward trend that began with BTC's all-time high. In addition, the asset has formed a double top on the four-hour chart, which is also a prerequisite for a short-term correction. If this bearish pattern is realized, then blowouts could push the price to two key support levels. The first is at the midpoint of the growth range at $42,600. Here, a local upward reversal is possible, and if the bull manages to defend this line, the asset will quickly return to the growth zone. If this level is broken, the next support zone will be the level of $37,300, where a rising high was formed. Also, this area served as an excellent springboard and held bitcoin from breaking through to the middle of a wide range of fluctuations two months ago. If this zone is held, the market will receive a powerful bullish impulse and maintain the upward trend of July 20.



However, as of 14:00 UTC, technical analysis of the cryptocurrency points to pit weakening, which is a prerequisite for a powerful correction. The RSI has dropped past 40 on the 4-hour chart. The MACD continues its downward movement towards the zero level, and the stochastic has formed a bearish crossover and will soon leave the bullish zone. The weakness of bitcoin at the current stage indicates a strong resistance level that the asset is not ready to overcome. As a result, the bears will try to push the price as low as possible, but in any case, this stage should be viewed as an opportunity to buy more.



This is also evidenced by the daily state of technical indicators. The RSI is dipping into the 60 zone and the MACD indicates a continuation of the bullish momentum. At the same time, the stochastic gives clear signals for weakening. This may be an opportunity for the bears to aggravate the fall in bitcoin prices, but, most likely, sellers will not be able to push the asset below the long zone.



Bitcoin has shown clear signs of weakening over the past two weeks, but with the current market sentiment, the bears will only be able to profit locally from this correction. The cryptocurrency will hold one of two key support levels, consolidate and resume its upward movement. The market is dominated by restrained optimism, which indicates a willingness to wait and buy. Taking this into account, we expect a systematic waiting for an ideal position to buy back the next downward phase and further breakout to $46,400.





Artem Petrenko
Analytical expert
InstaFintech Group © 2007-2021

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Bitcoin tramples at $47,500 mark. Bloomberg discovers name of Bitcoin's real creator



Bitcoin has worked out the level of $47,500 several times over the past few days and bounced off it twice. Thus, for the time being, we can conclude that this level is too much for buyers, so the cryptocurrency has a good chance of starting a fall. However, we also remind you that there is still an upward trend line on the 4-hour timeframe, which continues to support buyers and maintain an upward trend. Thus, the price is now caught in a triangle between the level of $47,500 and the trend line. Whichever of these lines it will overcome, the movement will continue in that direction.

Meanwhile, one of the Bloomberg analysts said that he knows who is hiding behind the mysterious name of Satoshi Nakamoto, who is credited with creating the first cryptocurrency in the world, as well as a fortune that is now estimated at about $61 billion. According to Eric Balchunas, the programmer Hal Finney, who died back in 2014, is hiding under the name Satoshi Nakamoto. Finney's name is quite well known in cryptocurrency circles, as the name of one of the founders of cryptocurrencies, who participated in the development of bitcoin, and also conducted the first bitcoin transaction together with Satoshi Nakamoto back in 2009. Balchunas came to this conclusion after he came across a message from Finney, which he left back in 1994 on a forum, and in which he described a principle that is very similar to the current technology of non-fungible tokens (NFT). Thus, we now know another alleged name of the creator of the most popular cryptocurrency in the world, who also owns about 750,000 to 1.1 million bitcoin coins according to various estimates.

At the same time, the fundamental background for bitcoin remains rather weak. The problem is that there hasn't been any particularly positive news in the last few weeks. Nevertheless, bitcoin is up $18,000 and we have already questioned the reasons for such a strong growth. From our point of view, investors were just in a hurry to buy as many coins as possible lately, while the US adopted new tax legislation, which states that most of all bitcoin transactions will immediately fall into the "field of view" of the IRS, which will make many cryptocurrencies less attractive for investment. However, there is still no talk of a new "bullish" trend, and we still expect bitcoin to fall to the level of $29,700.



In technical terms, bitcoin continues to be in an upward movement on the 4-hour timeframe and has worked out the level of $47,500 twice. This level is important as it is the low of April 26, as well as 50% of the movement from the absolute high of value to the low of 2021. At the moment, bitcoin cannot overcome this level, so again there are expectations of a new drop in quotes to the level of $29,700, which we are counting on. Thus, to sell cryptocurrency, you should wait for the price to consolidate below the trend line. The targets are $40,746 and $31,100. Overcoming the level of $47,500 gives way to new purchases with a target of $50,350.





Paolo Greco
Analytical expert
InstaFintech Group © 2007-2021

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Trading Signal for Bitcoin, for August 17 - 18, 2021: Sell Below $46,957



Bitcoin (BTC) touched $ 47,961, the levels of May 16. BTC has tested this resistance zone twice and formed a double top as a result. It may be a sign of correction or a slowdown in the coming days.

Volatility and the volume of purchases of BTC have reduced, as the Eagle indicator is showing a bearish divergence. It is likely to put downward pressure on BTC in the coming days.

The 21 SMA around 46,500 located on 4-hour charts may provide some support to BTC as long as it trades above this line. Bitcoin is likely to try to climb towards the resistance level and psychological level of $ 50,000 (8/8).

The level of $46,000 is the immediate support. If the price breaks this level, it may fall to the support of 6/8 of Murray ($43,750). This is the key level because there we can expect a new bullish rebound and an opportunity to buy BTC.

On the contrary, if the bearish force prevails, a decline is expected to the support zone around the 200 EMA and the 4/8 Murray line located at $ 37,500.

Our outlook will be bearish due to the factor of the double-top pattern and the Eagle indicator that is showing a bearish signal. We should wait for the BTC to trade below the SMA 21, and we can sell with targets at $ 43,750 and $ 37,500.


Support and Resistance levels for August 17 - 18, 2021
Resistance (3) 49,859
Resistance (2) 48,876
Resistance (1) 47,451

Support (1) 45,042
Support (2) 44,103
Support (3) 42,633




Dimitrios Zappas
Analytical expert
InstaFintech Group © 2007-2021

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Global growth in the capitalization of cryptocurrencies



Bitcoin is experiencing an impressive rally in mid-August, breaking through $ 48,000 this weekend and raising the market value of the cryptocurrency by more than $ 2 trillion.

The leading digital asset managed to reach $ 48,126.47 on Saturday. Since mid-May, this has been the highest level.

CoinMarketCap reports that the crypto market sees a market capitalization of $ 2 trillion for the first time in three months.



The positive price dynamics in August came after Bitcoin's significant sell-off in June and July when the popular cryptocurrency fell below $ 30,000 after reaching April's record highs of 65,000.

Some analysts warn that it is not worth actively celebrating bitcoin's bullish victory yet, saying that another correction is possible.

According to Craig Erlam, Senior Market Analyst at OANDA Europe, Bitcoin has hit new highs once again without a corresponding surge in momentum, which is not ideal. The cryptocurrency lacks momentum to get it back above $ 50,000.

Bitcoin was able to ignore negative news last week, sharply moving towards $ 50,000.

Chairman of the US Securities and Exchange Commission (SEC) Gary Gensler once again stressed that the SEC needs powers, especially when it comes to crypto exchanges. He added that one of the biggest problems that worry him is stablecoins.

The cryptocurrency was also shaken by the news about one of the largest thefts in the world of decentralized finance. More than $ 600 million was stolen from the Poly Network blockchain site, as hackers took advantage of a vulnerability in the system and stole thousands of digital tokens, including Ethereum. However, in an unexpected move, the hackers returned almost everything that was stolen.

One popular crypto trader, Scott Melker, describes this cryptocurrency rally as an approximation of prices to the actual value.

He said that the price is actually catching up with the cost due to the large liquidation of traders with leverage, which led to the fact that the price cascade was much further than expected.






Irina Yanina
Analytical expert
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