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Risk-On Could Bode Well for Bitcoin
BTC: Price: $9,250 | MCAP: $166 Billion | 24-Hr Volume: $21.12 Billion
Short-term trend: Bullish
The ongoing rally in the U.S. stocks may bode well for bitcoin. “Prior bitcoin bull runs were characterized by a gradual decline in equity market volatility. For example, we’ve noted its, albeit imperfect, inverse relationship with the VIX Index over longer time horizons (i.e. 2017 run-up),” analysts at Delphi Digital wrote in their monthly report.
The S&P 500 clocked a record high of $3,066 on Friday and the bull market is expected to continue on the back of three big buyers – corporations, foreign investors and US households – according to Goldman Sachs.
Technical charts are also reporting bullish conditions. Notably, the repeated defense of the 200-day MA seen over the last few days indicates the pullback from recent highs near $10,350 has likely ended and prices could soon rise to $9,600 and higher.
In fact, the recent pullback from $10,350 to $9,000 was accompanied by a drop in volumes. A low-volume pullback is often reversed, meaning a rise all the way back to $10,350 cannot be ruled out.
The bullish case would weaken if prices find acceptance under the 200-day MA, currently at $9,108.
Long-term trend: Bullish
Reward halving is likely to keep bitcoin better bid over the next few months. Historical data shows the cryptocurrency rallied from $5 to $16 during the six months leading up to the reward halving in May 2020.
Also, BTC jumped from $360 to $780 in the four months to mid-June 2016, before trimming gains and falling back to $465 in August, when the block reward was cut from 25 BTC to 12.5 BTC.
More importantly, BTC continued to scale new heights following the reward halving. The long-term bullish case The bullish case looks stronger if we take into account the strengthening narrative that the top cryptocurrency is a digital gold and a hedge against inflation.
Many observers believe the negatives interest rate era could force traditional investor to pour money into cryptocurrencies. After all, BTC is the best performing asset of 2019 and possibly of the decade.
Long-term technical studies are also biased bullish. For instance, the 100- and 200-period averages have produced a bullish crossover on the three-day chart. A similar bull cross in March 2016 was followed by a 21 month bull market.
The bullish view would be bolstered if and when prices exit the four-month falling channel seen on the weekly chart, confirming a resumption of the rally from lows near $4,000 seen in April.
That looks likely by the year's end, as the three-day chart MACD, which has a strong record of signaling big moves, has turned bullish for the first time in over three months.
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Decred Goes Ballistic
DCR: Price: $2.72 | MCAP: $236.01 million | 24-Hr Volume: $18.7 million
Short-term trend: Overbought
DCR's incredible 43 percent rise over a 3-day period has finally slowed as it begins to show signs of exhaustion with a faltering daily candle and decreasing levels of volume on a rising price - a bearish volume analysis.
Prices are now extreme overbought, demonstrated by the daily RSI well above 70. However, residing above the 100-day moving average hints at a mid-term bullish trend forming should prices maintain a footing above $21.45. That support area will be crucial as the new month develops.
Long-term trend: Neutral
The long-term trend is now in contention thanks to recent price gains pushing value back above former areas of resistance along the 50-day moving average and 100-day moving average located at $17.31 and $21.45 respectively.
The AO has been unable to produce new peak highs on its histogram bar since April 9, highlighting its oppressive downtrend, that until recently, has suppressed bullish aspirations. More time is needed to see if November produces a breakaway from the ongoing downward trend.
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Needing To Prove One's Worth
SNT: Price: $0.01344 | MCAP: $46.6 million | 24-Hr Volume: $183.7 million
Short-term trend: Pullback
Sliding 5.47 percent on the day, SNT continues to pullback from a breakout witnessed Oct. 25 to Oct. 30 before a sharp correction took place and brought prices back toward the 50-day moving average (MA) located at $0.01311.
The short-term trend depends largely on SNT's ability to hold the 50-day MA. an indication of short-term market health, bullish when prices are above and conversely bearish when below.
Long-term trend: Neutral
The long-term trend has finally begun to show signs of life for buyers as the RSI crossed bullish above 50 on Oct. 27 whereby utilizing that area as support before bouncing higher. That has not been achieved since February and points to a reversal in the long-term bearish trend.
However, the 100-day MA (blue line) is the determining factor (alongside the 200-day MA at $0.020), in whether or not price action has enough buyer (bullish) momentum to continue to reverse recent Oct. 25 lows at $0.013 or face another rejection along those lines and continue trending south.
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Bitcoin trading volumes have reportedly hit record highs in Argentina, which is facing yet another economic crisis.
The political and economic turmoil has taken toll on Argentinian Peso, forcing the central to lower the U.S. Dollar purchases limit from $10,000 to $200 per month.
Argentinians, therefore, are flocking to bitcoin, which cannot be censored and can be moved across borders in minutes. Also, the top cryptocurrency is deflationary in nature. Its supply growth is trimmed by half every four years via mining reward halving.
Due to increased demand, bitcoin in Argentina is trading at a large premium to prices on the U.S. exchanges. Currently, BTC is changing hands at $9,250 on Coinbase and is reportedly trading well above $10,500 in Argentina.
In the past, BTC has consistently found love in hyper inflated and politically and economically unstable nations. Essentially, the cryptocurrency takes up a role of a safe haven in dystopian economies where investors have lost confidence in “all major reserve assets (dollar, euro, yen, gold) and in the payments system.
In stable nations, it is still being viewed as a risk asset due its volatile nature. |
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| Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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Risk-On