The Rundown

We’re up 20%.

Down 10%.

We’re up 15%.

Down 10% again.

We’re up 17%.

Down 20%.

…welcome to tumultuous volatility ride of Bitcoin - Satoshi never said this was going to be a smooth ride – the volatility of the market might bring up images of the Gold Rush in the 1800s where those lustrous golden rocks miners held also could sometimes lead to violence, rape, murders and other dastardly deeds.

And speaking of volatility – just so we can make a fair comparison – back in February 2018 the Credit Suisse closed all trading of their own Inverse VIX Short Term ETN (XIV) after it dropped 90% in value in ONE day due to believed exaggerated movements. Key words:  -90% and ONE DAY. Crazy shit doesn’t just happen in crypto.

So what was the reason behind BTC’s 20% drop this past week? Well it’s very easy to use Bakkt’s opening flop as a scapegoat…BUT…We’re going to use it anyways. Considering all the hype leading up to the launch, and the fact that Bakkt is part of the whole ICE ecosystem (which includes juggernaut NYSE), having a first day volume of just 71 BTC is embarrassing. That wouldn’t even rank it in the top 100 exchanges on CMC.

Sooner or later, having the big players enter into the space was inevitable. The question of whether or not we need them though… that’s yet to be answered. Is the launch of Bakkt’s physically delivered BTC futures a ploy to allow mammoth institutional investors the same liberties they have with other markets to freely dictate the price movement of BTC, or will it do what it’s intended to which is to make BTC more mainstream? Both sides of the coin, pun intended, can be argued. In a perfect world and according to the base beliefs of the early HODL’s: BTC controls the big players and not the other way around. But with Bakkt on board and the CME having just recently announced their plans to launch options next year for its futures contracts, one can almost faintly hear Phil Lynott (who's Phil Lynott?) rolling up in his grave whispering “the boys are back in town”.

Despite the unprecedented volatility and all the controversial exchange hacks, the underlying BTC technology has never faltered. Don’t forget, BTC has been around for 10 years already. With BTC’s price action already below the 200 D SMA we could see further depreciation in the near term. The last time we saw the price go under the 200 D SMA was in early February 2018, which more or less heralded a crypto winter.

But it’s not all doom and gloom yet for HODL’ers who are scared silly. BTC is still up over 110% at the time of this writing. And the last time we saw a one day 20% drop was on May 17th of this year which actually ended up being followed by an 80% run hitting its peak on June 26th. Although chances for the same thing to happen again this time around are slim, it shouldn’t be taken off the table just yet.

As for the top altcoins this past week, abysmal as well. EOS took the biggest hit at -30% followed by BCH (-27%), ADA (-25%), and TRX at (-25%). That’s all we can say about the alts for this week’s outlook. It really doesn’t look too pretty out there.

Three things to know

  1. Singing to the same tune of the big timers entering the market, this past week saw the popular online lending platform, SoFi, announce their crypto trading platform supporting only BTC, LTC, and ETH. Will we be paying off student loans with crypto soon?
  2. The historic and prestigious Medici Bank will soon start accepting crypto clients as bank customers. Founded by Prince Lorenzo de’ Medici, a descendant of the Renaissance-era Italian banking family, Medici Bank will join the short list of financial institutions that are welcoming to crypto companies.
  3. On the coming eve of the 70th anniversary of the People’s Republic of China (the start of China’s Golden Week), threats from US officials to limit US investment into China has rattled markets towards the downside. This also included rumors of blocking Chinese companies from listing in the US and even delisting current Chinese companies from US exchanges. Regardless of whether this will take place or not, releasing these statements right before China’s National Day seems like a strategic ploy.

Chart of the week

As we all know, BUY LOW SELL HIGH.

So listed below are 5 possible re-entry points into BTC:

weekly chart 29.9.19

  1. 9478 represents the 0.382 Fibonacci support level we have relied on during the triangle formation. But that was broken through, hard. If prices bounce back through it, look to buy back at this price.
  2. 8349 | Prices for the past 3 days have been bouncing off the 200 D SMA . Looks like a good support level for the time being.
  3. 7555 | This was the support level felt from June 4 - 10. There’s a large possibility that prices could use this as support once again.
  4. 7022 | This level represents the 0.236 Fibonacci support level. Buy here if you believe in the Golden Ratio
  5. 5408 | This level represents the worst-case scenario of the triangle breakdown.