The Rundown

Bitcoin has yet to show any signs of life in the past week. But it seems that we can’t make our minds up about what we want from BTC. We are looking for BTC to be the ultimate store of value asset/currency, which by default should have price stability as one of its characteristics, but we’re also rooting for those 10x shots to the moon – it’s oxymoronic if you really think about it.  

BTC has only moved about 1% to the downside since Oct. 13th. If we look at the daily chart, bearish signals seem to be lighting up as a death cross looms around the corner. A death cross, 

meaning when the 50 D SMA cuts through the 200 D SMA to the downside, has been a traditional bearish signal for the equity markets.

And the last time this happened back on March 2018, more than a year ago, we were basically at the start of crypto winter. The past week has also witnessed BTC’s 21 D SMA acting as a resistance (what's a resistance?) starting from $8,600, down to around current levels of $8,200. If BTC manages to fall through to $7,720, we can expect a further sell off to happen as volume orders below that are very shallow right now.

As with the rest of the top alts, XRP was the winner this past week with a 6.5% gain and EOS being the loser with a -6% slide. XRP is an interesting coin to follow. Since the September 24th correction, it is up close to 40% from a low of around $0.21 to its current level of $0.29. Although momentum seems to be slowing down as the Money Flow indicator (what's a MFI?)  is showing a reversal from the 80 level and the MACD showing a near downwards cross through the signal line. If the 50 D SMA can manage to breakthrough the 100 D SMA, use that as a sign of strength for the bulls. But a near term downside move is more imminent as Ripple’s sales fell 74% quarter over quarter according to their latest XRP Markets Report released this past week. We find it a little bit comical how they point to twitter bots for their dampened sales.

Three things to know

  1. FXCM Group, a popular FX trading platform, has launched a basket of 5 cryptos, including BTC, LTC, BCH, XRP, and ETH, for retail investors to get their feet wet in the crypto space. This basket is being named CryptoMajor and as FXCM’s CEO quotes, “Trading a basket of cryptocurrencies means our users are freed from the hassle of constantly monitoring the markets. CryptoMajor therefore streamlines the trading process and protects our customers from unanticipated and adverse market movements.”
  2. The Shanghai Gold Exchange launching its Shanghai Gold Price Benchmark, has proved to be a harbinger to other nations also pulling away from the COMEX, LMBA, and western bullion banking cabal. For decades the COMEX in Chicago and NY has been the leader in setting gold prices, but as other countries including China and recently the UAE set up their own gold exchanges, the global standard for gold being priced based on the US Dollar is surely in threat.
  3. In yet another surprising and not so surprising piece of news, another Goldman Sachs banker has been charged for insider trading – this would be the third Sachs employee to be charged for this in the past 18 months. The culprit, Bryan Cohen, a VP, has been charged of leaking nonpublic material information for the past three years in exchange for cash. Could this kind of behavior be avoided in crypto? Probably not for the time being.

Chart of the week

weekly chart 21.10.19

As mentioned above, it seems that a death cross is looming as price action continues to possibly consolidate towards the downside with the 21 D SMA acting as resistance. To pivot to another market as an indicator of BTC’s price, the S&P has been suppressed by the resistance level of 3000. If we see the S&P pull out from under this level, we may see BTC get the jolt that it needs. A lot of global factors also need to be aligned in order for such a scenario but as we see the continued US-China trade war extend and the latest impeachment status of Trump, the near term downside seems a strong possibility. Combined with China’s latest GDP number showing the slowest quarterly growth in the past two decades, it’ll be interesting to see how prices play out for the rest of the year.