After the lackluster opening week of Bakkt’s physically deliverable BTC futures where we saw a 20% drop in price in one day, the following week saw prices staying “relatively” calm. BTC is down 4% with other top altcoins staying flat in sideways trading (what’s a sideways market?). The surprising winner is TRX (TRON) which is up over 8% since the past week and has somehow rejuvenated its Twitter activity since the Buffet lunch fallout this summer (Tron’s CEO paid 4.5M USD to sit down to lunch with Warren Buffet – and even invited US President Donald Trump). Despite trading down to its low point at around $0.01124, according to www.cointobuy.io, it is considered to be one of the safest coins to buy right now. Trade it for the lowest trading fees at BXB Exchange!
But probably the most stunning news to come out this past week was the settlement between Block.one, the parent company of EOS, and the SEC over charges relating to EOS conducting an unregistered ICO – a violation of both Reg A and Reg D of the Securities Act. The ICO raised a total of $4 Billion USD and was only fined 24M USD which seems to hint that mass adoption for cryptocurrency is just right around the corner (but wait, it’s not that simple – EOS did take steps to cover themselves). It’s still a hefty fine compared to the penny settlements that traditional ‘too-big-to-fail’ banks pay regularly to the SEC – still, the final verdict of the EOS case fortified trust in the currency, pushing EOS’s price up 3% this past week.
As we continue to see BTC’s prices drop, pushing their market dominance to 66%, many analysts are starting to herald the beginning of the alt-season (what’s an alt?).
Three things to know
- French Hill (R-Ark.) and Rep. Bill Foster (D-Ill.) both sent letters to Fed Chairman Powell, outlining their concerns about risks to the U.S. dollar if another country or private company creates a widely used cryptocurrency. The bigger players getting worried is a sure sign of cryptocurrency gaining popular recognition, and power. One of the letters stated:
“We are concerned that the primacy of the U.S. Dollar could be in long-term jeopardy from wide adoption of digital fiat currencies. Internationally, the Bank for International Settlements conducted a study that found that over 40 countries around the world have currently developed or are looking into developing a digital currency.”
- This week saw Paypal withdraw their membership from the Libra Association in an effort to continue focusing on their own business advancement. In specific words they stated their intent to, “…continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.” Will this set a precedent for other current members to drop out from the Libra Association (what’s the Libra Association?).
- In an effort to boost Bakkt’s inauspicious debut, two large institutions, Galaxy Digital and XBTO, conducted the exchange’s first block trade of Bakkt’s bitcoin futures contract. A block trade is a large transaction that takes place off the open market in order to avoid moving the price too much. What we think this is aiming for is to encourage institutions to get more interested.
Chart of the week
Just a few days ago we saw LTC’s 100 D SMA breakthrough its 200 D SMA to the downside giving bears an opportunity for action. An interesting price level that should be watched is 1.414 level from the Fibonacci extension retracement ($47 price level).
Fibonacci extensions are a tool that traders can use to establish profit targets or estimate how far a price may travel after a retracement/pullback is finished. Extension levels are also possible areas where the price may reverse. (investopedia)
Back near the 2nd half of 2018, LTC bounced off this level 3 times for support. If LTC cuts through, look for further depreciation but if it somehow manages to bounce off once again, look for a swing rebound in the near term.
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