In this weekly op-ed, Pavel Schipanov, head of the ICBF analysis and research team, evaluates the market outlook against the background of the latest news.

The first cryptocurrency continues to intrigue the community with its ability to move without any certain dynamics in recent months. The borders we had designated earlier at $6,000 to $6,800 remain relevant because the price has not gained enough strength to break through them to one of the sides. Within the framework of the current week, one can even observe the predominance of movement near the value of $6,600, now down by $100 to $150, then upwards by the same amount. It should be noted that, from the point of view of the fundamental component of reasons for price movement, there are constantly grounds for the development of a trend. But, in fact, this news does not affect the price after the SEC indefinitely postponed the decision on the VanEck SolidX Bitcoin Trust ETF application or, in simpler words, on the start of trading in the ETF Bitcoin fund. After this event, two more meetings of state commissioners took place. At the same time, according to their results, the only decision was constantly made to postpone consideration due to the lack of information at the current moment and concerns about the safety of investors' funds. The next meeting of SEC commissioners may take place before the end of 2018.

The news about the creation of a coin by the Circle startup (Circle is owned by Goldman Sachs, the largest bank in terms of assets) based on the U.S. dollar (USDC) became the most positive event of the final week. Compared to other peers, like TrueUSD or Tether (USDT), the main competitors among young stablecoins, this asset will be backed in a 1:1 ratio with physical dollars and will be audited by proven companies, unlike USDT, the funds in the accounts of which are questioned by investors. As if by chance, on the same days, the media began to exaggerate unconfirmed, although not disproven, information about possible problems at the Puerto Rican bank Noble Bank International, where Tether funds were previously located. Later, it became known that the affiliated companies of Tether limited and the Bitfinex exchange managed to withdraw funds in the amount of $3 billion to another financial organization.

Graphic display of the growth dynamics of deposits at Noble Bank and Tether issued from 2014 to the beginning of 2018
Graphic display of the growth dynamics of deposits at Noble Bank and Tether issued from 2014 to the beginning of 2018. Source.

When evaluating the current situation, Changpeng Zhao, the CEO of Binance crypto exchange, one of the leaders in the CoinMarketCap rating, is sure that the cryptocurrency market will start growing soon because there is no “bearish” market right now. He is echoed by a no-less-legendary person on Wall Street, Mohamed El-Erian. He did not give forecasts about the cost of Bitcoin before the end of the year, something that many market gurus have been trying to surprise us with in recent months, but he inspired investors by saying that "crypto is not dead, and certainly the underlying technology is not dead. We’re going to see more widespread adoption, by both the private and public sector, of the blockchain technology and related technologies." At the same time, El-Erian confirmed readiness to buy Bitcoin only from the level of $5,000.

It is also necessary to note the statements of experts of another large financial organization from Wall Street Bank, Bank of America (BoA). They believe that blockchain technology could potentially create a new market with a capitalization of more than $7 billion for real estate companies, cloud computing, and logistics, for example, for Amazon and Microsoft.

In addition to the statements of these significant individuals about the interest in the world of

blockchain and cryptocurrencies, there is one more argument in favor of their acquisition. Namely, the volume of Bitcoins stored on the top 100 wallets of the whales.

The dynamics of accumulation of Bitcoins in the top 100 wallets
The dynamics of accumulation of Bitcoins in the top 100 wallets. Source.

It can be noted that the owners of the wallets in a falling market do not sell their Bitcoins, but, on the contrary, they are actively acquiring them. Thus, 45,834 Bitcoins were sold from eight whale wallets, while on September 14, the wallet balances increased by 109,522 Bitcoins. And, apparently, the largest cryptocurrency holders only want to accumulate their assets in anticipation of future value growth, unlike ordinary investors who are trying to catch the trend waves. And what is the situation at this time on the charts?


And now let us evaluate the current situation from the point of view of technical analysts. There were no significant changes compared to our previous review. The graph below shows the development of movement in the framework of the technical analysis of the Forks of Andrews and, provided the support at $6,500 is below support, we can expect to reach the $6,400 area with the potential to achieve in the future a cluster of $6,000, $6,111, and $6,200.

If the decline will have the character of a short correction and over the coming weeks there will be buy signals, then we should expect growth in the area of ​​resistance of $6,670, $6,820, and $7,000, where the upper limit of the forks now passes.

BTCUSDT chart, four-hour time frame
BTCUSDT chart, four-hour time frame. Source.

Note the narrowing of the boundaries of the Bollinger bands (indicated in the graphs above and below in blue), which usually precedes the beginning of a powerful movement. Therefore, do not forget about long-term goals. Developing a move below $6,000 will allow consolidation in the form of strong support at $5,600 and $5,776 to $5,880.

An alternative option with a break above $7,000 will give grounds for testing areas of $7,200 and consolidating $7,375 to $7,500 and $7,800. It will be the most rational to argue about other goals only in terms of well-established trends.

BTCUSDT chart, daily timeframe
BTCUSDT chart, daily timeframe. Source.

Ether and Other Altcoins

The market of altcoins continues to move without landmarks, therefore, as traders joke, now it “moves to the right.” There are also no interesting trading ideas on Ether, and the price is close to $220, where the 200-period simple moving average line on the four-hour chart is now located. After the realization of the forecast of reaching the levels of $230 and $240 with the subsequent rollback, expectations are being held about the possibility of a new attempt to collapse to levels of $180 and a cluster of $193 to $200. But in the case of the development of a powerful collapse below $180, we should expect a move to the marks of $160, $131, and $100.

In the longer term, we should expect a departure from current values ​​to the area of ​​resistance at $251, $270, and $300. The idea of ​​the development of a new trend will be confirmed by a rise above $340, where the line of 23.6 percent correction along the Fibonacci lines is located.

ETHUSD chart, weekly timeframe
ETHUSD chart, weekly timeframe. Source.

And finally, a bit of positive news: John McAfee confirmed his willingness to run for the presidency of the U.S. in 2020. Although he understands that he will not take the chair of the head of the country, he promises to popularize the new digital economy.

Profitable trades for you all!