The Rundown

BTC…down…as expected.

In the last Monday Crypto Market Outlook, we specifically laid out the implications of the 100D SMA crossing down through the 200D SMA. We have also made reference to the last time this has happened.

weekly chart 25.11.19 4

And what have we seen the past week? BTC down 20%.

weekly chart 25.11.19 4

The MFI has now reached its lowest point since a year ago at the 3.74 level with the MACD drowning at the -441 level with a delta of 189 from the signal line. Two support lines in 7400 and 7000 have already been breached. Watch for the 7000 level to be a critical level going forward as it represents the 0.236 Fibonacci level which is represented by [(1+sqrt5) / 2]^-3. Swing trades at this level could still be possible as seller exhaustion looks imminent.

As the US-China trade war lingers with the US recently supporting the HK situation, negative sentiment could drag on for the next few months. For now, things in the traditional markets haven’t been as bad as expected with the S&P up 7% since September versus BTC being down 36% in the same timeframe.

weekly chart 25.11.19 4

Things within the next few months leading up to the halving event are surely going to heat things up with the US elections, impeachment hearings over the Biden-Ukraine corruption, and Libra’s continued development. And despite the recent crackdown on crypto exchanges here in China, it’s been quoted that the Central Bank of China could be rolling out its announced digital currency sooner than expected. Considering that China has been looking into its own digital currencies for years, one might question what’s the hold up?

But in general, has another bear market started? Or were we still in a bear market from the highs of December 2017? As BTC goes, so does the neighborhood, as they say. All the major altcoins are down more than 20% with DASH down close to 30%. And if I told you that half of the entire crypto market capitalization (that equates to about $157B in value) has been wiped out, would you sell or buy more?  

For now, 7000 is going to be a critical level going forwards. To play swing trades around here.

Three things to know

  1. Fidelity Digital Assets (FDAS) are planning to roll out its first crypto exchange to cater to retail investors. Currently FDAS serves institutional investors through OTC and block trading services. It also acts as a custodian for major investors to hold their crypto. With an exchange platform, FDAS can now attract the retail investors in the space.
  2. ICE has announced that the Bakkt Bitcoin Cash Settled Monthly Futures contracts will be listed on ICE Futures Singapore and cleared by ICE Clear Singapore – both regulated by the island-state's central bank. Back in September, Bakkt rolled out its first ever physically settled BTC futures contracts to a abysmal response which sent BTC rumbling down 20%.
  3. TD Ameritrade has been in talks in acquiring legendary brokerage and wealth manager Charles Schwab. This is a huge implication to the current investment environment and how we deal with investment accounts. Earlier this year, the race amongst brokerage and ETF providers were to lower fees to basically zero. This has been a huge hit for sales in general. And to point out that Charles Schwab has never had any real engagement in crypto. All this could be a correlation to either the lack of investment from millennials within this traditional brokerage powerhouses, or the lack of “keeping up with the investment trends” ala crypto.

Chart of the week

weekly chart 25.11.19 4

As mentioned before, 7000 will be the critical level for us. If we close 3 daily candles above 7000, look for prices to move upwards towards the turquoise top channel line. If we close 3 daily candles before 7000, look for prices to gyrate between the 7000 level and the lower turquoise channel line.