Cloud Hosting

Bitcoin (BTC) price has gained more than 10% in the last week, giving bulls some hope that the road ahead is a bright one for the leading digital asset.

However, despite an effort to blast through the critical resistance level of $7,200 as mentioned in last weeks analysis, there was a huge rejection bringing home the reality that perhaps it may be a little too soon to be expecting a miraculous bounce back to the $8,000+ levels.

Daily crypto market performance. Source: Coin360.com

BTC USD daily chart. Source: TradingView

I think its safe to assume that Bitcoin has settled back into the descending channel that formed in the second half of 2019. As Bitcoin has now not only bounced off support on the daily, leaving nothing but a wick, but it has now done exactly the same with the resistance.

To me, this validates the channel even more so than before, as the price is currently following a path marked I marked out in yellow, on a video I published to YouTube on March 31. This was one of three scenarios I was waiting on, and the one I felt that was most likely.

As such, since Bitcoin cannot seem to break out above $7,200, it seems probable that bears might be about to regain control ahead of the much-anticipated halving event, and this puts $5,500 as the critical price to hold before cheap corn is back on the menu.

However, many key indicators are contradicting this sentiment.

BTC USD weekly MACD chart Source: TradingView

During sideways market periods, it is easy to get chopped up and spat out when working off lower time frames, and often a glance at a higher time frame can help validate your bias. However, one such indicator that isnt good for bears right now is the weekly moving average divergence convergence (MACD) indicator, as this is now mooing to the herd.

As can be seen from the chart, the MACD is already starting to pinch towards the signal line. Since we have had a relatively bullish week, we should see this move in even more so when the weekly candle closes, bringing us closer to a bullish cross, which typically results in a sustained uptrend, which almost always lasts over a month if not several.

However, right now, there are bigger things happening in the world that may invalidate this as a possibility, and my concern is that we will begin to see a significant reduction in retail buying power due to the rise in unemployment resulting from the coronavirus lockdowns.

While the worldwide quarantine is in the early stages with many believing it will only last a couple of weeks you only need to look at China to see that this will last a lot longer, so who exactly would be buying?

The answer may lie in the Relative Strength Index, which could be enticing smart money into crypto.

BTC USD weekly RSI chart Source: TradingView

The last time Bitcoin approached oversold territory on the weekly, it experienced a 300% price increase within six months as can be seen on the Relative Strength Index (RSI) indicator. This is based on the Dec. 10, 2018,pivot from 29.07 on the RSI scale.

However, Bitcoin had already experienced a bounce on the RSI on March 9, 2020, when it was 33.37 on the RSI scale, and even with the colossal dump on March 12, the RSI is still trending upwards. This brings to light two pertinent questions:

But perhaps another clue as to what can be expected from Bitcoin over the coming weeks can be found in the mining difficulty charts?

BTC mining difficulty. Source: BTC.com

The Bitcoin mining difficulty dropped by a monstrous -15.95% the biggest since 2011 on March 26, an adjustment that helped ease miners concerns surrounding profitability. This time last week, it looked as if the mining difficulty would drop by a further -14%.

However, as the week has progressed the adjustment estimate has dropped to just -2.2% and with three days left to go, this could end up closing as a positive adjustment.

You only have to look at the impact the positive adjustments had on the price of Bitcoin this year to see what this could be yet another bullish indicator.

All the indicators are bullish, so why does it feel bearish? Right now we are at the top of a valid channel, as such a breakout could well be imminent. For this to happen Bitcoin would need to flip $7K resistance into support and from here $8,200 looks like the next level of resistance we would encounter.

The price of Bitcoin has already doubled since its recent bottom, as such a pullback to $5,500 over the next week would be completely reasonable to expect.

If this level fails to hold, then it opens up $3,900 as a possibility. If bulls dont step in then, Id be very surprised.

The views and opinions expressed here are solely those of @officiallykeith and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

More here:
Bitcoin Flips Bullish But Heres Why BTC Price May Still Hit $3.9K - Cointelegraph

The global spread of the coronavirus played a major role in the dramatic 2020 stock market crash. The bailout bill for saving the worlds economy is $7 trillion and rising fast. Bitcoin bull Tim Draper believes this confluence of factors may be the tipping point that allows innovations such as Bitcoin and smart contracts to flourish.

In an interview on April 6, the global venture capital investor said he was skeptical about the governments infinite money printing bailout plan and said it would take years before that money permeates the global economy.

They are gonna be printing all this money to try to get the economy back after they've basically tanked it, he said. They are going to flood it with a bunch of money, and that money is going to be worth less, and less, and less.

Draper believes people will start turning to Bitcoin as it has a fixed supply, in stark contrast to fiat which is being printed in the billions by central banks:

This is going to be a really interesting time where people say well, why dont I just use Bitcoin? I know there are only 21 million of them and we dont have to worry about whether a government is diluting their currency by printing tons of it, we can instead just use a currency we all agree on and its all a part of the economy and its already frictionless and open and transparent and global.

Although there is debate about whether coronavirus may end the trend towards globalization over the past 25 years, Draper believes digital financial innovations like Bitcoin, smart contracts and artificial intelligence will force governments to compete among themselves at the virtual level to bring better services at lower cost to attract talents.

This in return will empower people with more choices to move freely and live in a loving and nicer new global world. He added that:

It doesnt matter whether you are from the U.S, China or Russia or India or Europe or whatever, we are an open world and then the geographic borders are going to mean less and less.

See the article here:
Tim Draper: Pandemic Could Be The Tipping Point For Bitcoin - Cointelegraph

The number of Bitcoin addresses with a minimum balance of 1 has been on a rise despite the bearish sentiments in crypto markets.

While the derivatives market was predominantly bearish after the panic drop due to coronavirus on 12-13th May, the increase in BTC holdings projects positive on-chain fundamentals.Research analyst, Ria Bhutoria, currently with Fidelity Digital Assets tweeted,

The number of addresses with at least 1 BTC has consistently been establishing new highs every 1-2 days since March 22nd

Glassnode Studio which published the metrics notes,

Number of Addresses holding 1+ coins just reached an ATH of 802,715.000 Previous ATH of 802,567.000 was observed on 08 April 2020

Moreover, the SOPR (Spent Output Profit Ratio) is currently, at a critical juncture around 1. The indicator was introduced by Renato Shirakashi who notes in the blog post,

First of all, SOPR appears to oscillate around the number 1.Secondly, during a bull market values of SOPR below 1 are rejected, while during a bear market values of SOPR above 1 are rejected.

The drop which began in March has seen rejection from the number 1, twice and is now trading around 1. Rejection from this level could will continue to keep the bearish sentiments alive.

Moreover, the on-chain metrics for Ethereum has been consistent despite the drop in prices as well. The number of transactions is above the bear market during the latter half of 2019.

Ethereum [ETH] Daily Transactions Chart (Source)The number of unique addresses is also rising linearly. However, the number of addresses with more than 1 ETH witnessed a huge drop at the beginning of this year.

Moreover, the current risk-off environment as the economy is heading into a recession builds a strong case of cryptocurrenices. However, the risk associated with the investment is equally high.

Nevertheless, the number of ETH addresses with a balance of more than 10 has been stable, projecting a healthy long term view.

How do you think the price will be affected in the short-term? Please share your views with us.

Summary

Article Name

Bitcoin and Ethereum On-Chain Analysis: Consistency Persists with Short-Term Bear Threat

Description

The number of Bitcoin addresses with a minimum balance of 1 has been on a rise despite the bearish sentiments in crypto markets.

Author

Nivesh Rustgi

Publisher Name

CoinGape

Publisher Logo

Share on Facebook

Share on Twitter

Share on Linkedin

Share on Telegram

Go here to read the rest:
Bitcoin and Ethereum On-Chain Analysis: Consistency Persists with Short-Term Bear Threat - Coingape