Within the framework of the following op-ed, Pavel Schipanov, head of the ICBF analysis and research group, prepared a weekly analysis of Bitcoin and other cryptocurrencies.

The suspicious lull and the overly confident growth of Bitcoin (and then the entire cryptocurrency market) from $6,600 to $7,400 that followed it were associated with many hopes of traders in the form of the expected SEC decision regarding the launch of ETF for Bitcoins in late September. The expectations of the community regarding the introduction of the "complexity bomb" in September also fell short, which led to the postponing of the deadline for another 12 months after the Constantinople fork of the Ethereum network planned for October 30, 2018. It will happen to improve the network, reduce the reward for miners to two units of cryptocurrency, and add a number of other important improvements.

But the collapse that began in the middle of the week was a new confirmation that the cryptocurrency market is still affected by the large capital factor, which is backed by the whales, as the professional traders say. One can note at once a number of interesting movements between wallets of capital exceeding several tens of thousands of Bitcoins, which indicated the beginning of sales of the first cryptocurrency several days before a powerful collapse. Firstly, a wallet started working, which was connected with the Silk Road online drug market, which was closed in 2013 thanks to the FBI. Part of the funds in the amount of 26,000 Bitcoins, which the government organization was able to access, were sold almost immediately, but still, a lot of wallets related to the shadow organization remained dormant until this day. At the very end of August, the Internet was filled with information about the sudden movement of Bitcoins with small shares in the amount of $1 billion on a large number of addresses associated with leading crypto exchanges. The sale of a large volume could not go unnoticed, and this led to the demolition of positions to buy faster than a hot knife cuts through butter.

Secondly, the justification for the fall was the decision of the owner of one of the largest volumes of private capital in the world of the American bank Goldman Sachs to postpone for an indefinite period the launch of their new division, which will fully specialize in the trade of crypto and other virtual assets. But on Friday, the bank's officials denied this message, making a concrete statement that in no way have their plans changed. The panicky news was important for the market at that time, and their colleagues, the financial journalists from CNBC, began to feed the public with "sweet promises" about the price increase to $7,820 and even $8,000 with the subsequent overcoming of these values.

And do not forget that the three-month futures for Bitcoin on the CME ended trading on August 31, which usually leads to a reversal of the current trend and the beginning of a new one. In addition, attentive investors could note the decline in the volume of transactions on the exchanges, which traditionally indicates the possibility of changing sentiment among investors from "actively buying" to "abandoning the Bitcoin ship." Wednesday's movements and a collapse of almost $1,000 by Thursday morning say that these were exclusively panic sales.

In summary, we can say that although we warned about the risk of decline in the previous review, it is already very dramatic. Most likely, the collapse may continue, but the whales may have their own plans. Let us see what the cryptocurrency graphs say now.


As we wrote above, rates were clamped between the levels of $6,000 to $6,600 from the beginning of August, which led to the "opening of the spring" and shot up to a significant area of ​​resistance in the form of a cluster of $7,375 to $7,500 levels. The "upward triangle" formed at the top and the sharply increased volume of sales on the Bitfinex exchange prompted the forthcoming "revolution" and the "removal of the crown" from Bitcoin. Immediately after the breakthrough of the figure of technical analysis, a collapse began at a speed that had not been observed for a long time. At the time of writing this market review, there was a collapse to the support level in the form of the lower boundary of the cluster levels at $6,400 to $6,600. At the same place, as if on purpose, the descending line (indicated in the graph below in yellow) and the ascending (browned) trend line coincided. It is possible to expect the development of corrective growth to the levels of $6,600 and $6,670, where the 200-day simple moving average line is located.

At the same time in the trading of the upcoming weeks, the scenario of the continuation of the drop in the cost of Bitcoin seems most likely, and it will consistently be kept at levels of $6,200 and the support areas of $5,776, $5,850, and $6,020. Presenting a longer-term forecast now is a very powerful challenge for analytical ability in the conditions of increased volatility of the investment instrument. Therefore, I again recommend that when making deals, to refrain from fantasizing of making a profit on a crash or try to make a profit on assumptions that it is about to shoot up. If the downward trend continues, we should expect the following levels: $5,500, $5,280, $5,000, and $4,741-$4,800. The second option is a positive scenario, and if you find support at current values or around $6,000, which looks more likely, you should expect the development of growing dynamics. This can be confirmed by an exit above the values of $7,500 and $7,800. In this case, the first targets will be the area of values at $8,000 and $8,200 and levels of $8,500 and $8,900.

BTCUSDT graph, four-hour time frame. Source.

Bitcoin is still more inclined to continue to decline under the weight of the negative headlines that have piled on it, but it can very quickly "raise its head" when there are positive news and big businesses see the benefit in "pushing the sellers off the train." They can take advantage of the SEC's final answer on September 30 to the question of the possibility of launching ETF for Bitcoins.

Ether and Other Altcoins

With the collapse of Bitcoin, the market of altcoins traditionally shows a drop of two or three times more, and this is only considering the top ten of the CoinMarketCap list. Other assets may show worse results, but they are confronted only by the "forces of good" in the form of a number of stablecoins. It is in Tether (USDT) or TrueUSD that investors can channel their assets if they do not want to lose money in the "cycle" that is currently sucking in money from new bidders.

Concerning Ether, it can be noted that the forecast said that the price would rise to $300, and in the end, it turned out to be slightly higher, where your profit entry orders worked. The ensuing general market collapse led to a sure goal for declining dynamics in the form of a $250 level, and at the time of writing of this review, Ether is already near support at $215, where an 11-percent Fibonacci line runs from the August 2017 low. Maintaining a downward trend will make it possible to make a profit first in the region of $193 to $200 levels, and if they overcome these, $180, $160 and $131. In favor of this idea is the implementation of a "bear" model of price analysis, the "pennant." Usually, the decline occurs at 70 to 80 percent of its shaft, which began to form at the end of July and ended in mid-August, as shown in the graph below.

ETHUSD graph, four-hour time frame. Source.

Be 100 percent cautious today and be wary of the possibility of a sharp price movement to either side for all crypto assets. Profitable transactions for you all!