Bitcoin price witnessed the second leg of its rally that originated on July 20 but failed to produce a convincing close above a crucial support level. Moreover, a technical indicator is flashing a sell signal, further supporting a downswing.
Axie Infinity price has been a rebel coin due to its relatively recent launch and its breathtaking performance. While the exponential rally has not yielded gasping corrections, investors can continue to be bullish on AXS price.
Dogecoin price could see further consolidation before continuing its rally. A technical indicator suggests that DOGE has printed a local top, and the canine-themed token could retest critical support levels before making its next big move.
Matthew Tweed learnt his first valuable lesson about cryptocurrency six years ago, when he was just 14 years old.
“I got into investing in crypto because I found an interesting token that was meant to be for online marketplaces, and I moved from that to bitcoin,” Tweed told Insider. “I can’t remember what the project was called – it didn’t go anywhere, but that showed me that there’s a lot of cool projects, but a lot of projects won’t end up working out.”
Tweed now runs his low-latency trading firm, Pine Financial, from his family home in Woking, a medium-sized commuter town, 25 minutes from London. He believes 100% annualized gains are possible in that area of cryptocurrency trading.
Low-latency, or market-making, trading refers to the use of algorithmic trading to increase profitability. Tweed’s bots execute trades on crypto exchanges like Deribit.
“I managed to get into the market-making space without eight figures behind me, but it’s not very accessible,” Tweed said. “You have to put in a lot of time to become competitive.”
Tweed has spent a significant amount of that time on Reddit. He said his first break in market-making trading came from an interaction with another user on the social networking site.
“At the very end of 2018, I got into low-latency trading,” he said. “That came from someone I met on Reddit – to be honest, 90% of what I’ve done and the people that I’ve met has come from the various sub-reddits on algo-trading.”
“I frequent r/algotrading for a lot of my work,” Tweed added, referring to a Reddit forum with 1.2 million users that focuses on quantitative trading and automated strategies. “The specific subreddits are good, but places like r/cryptocurrency don’t have much good content, so I barely look at it.”
Tweed embarked on a career in algorithmic trading just as his classmates were beginning to apply to college. For him, a formal education had limited appeal, given his success with cryptocurrency trading.
In terms of which cryptos he likes the most, Tweed said he believes the ethereum network’s superior technological capabilities will enable its ether token to surpass bitcoin.
“Ethereum will be far more scalable – that should lead the way for being able to make much better applications, so you can have a proper smart contract based decentralized system,” he said. “You’d never be able to build smart exchanges on top of bitcoin – there’s not a platform for it.”
“Long-term, I think there’s a good chance ethereum will become the king cryptocurrency,” Tweed added.
Ether has been volatile this year, surging from $730 to a peak of almost $4,000, before collapsing to under $2,000 weeks later. The token has risen by around 10% to $3,140 since last week’s implementation of the so-called “London hard fork” upgrade, which initially burned around $8,900 worth of coins per minute.
“I think Ethereum 2.0 is going to be great for scalability in the crypto space,” Tweed said. “Many smart contract platforms claim better scaling than Ethereum, but they’re often extremely centralized, or make other fundamental trade-offs, which defeats the purpose of crypto.”
However, despite his own success as a relative outsider, Tweed said investors need to be careful before throwing themselves into the cryptocurrency space.
“Cryptocurrency is fairly small and specialist – I wouldn’t recommend people just throw money at it,” he said. “There’s a lot of ways that retail investors can lose money.”
“There’s a need for regulators to have knowledge of the industry, but in general, I’m in favor of exchange regulation, risk disclosures, and education to protect retail investors,” he added.
Tweed pointed to ‘sh*tcoins’, such as the highly volatile dogecoin, as an example of an area where retail investors could potentially lose money without tighter regulation.
“[Sh*tcoins] are amusing, and I enjoy watching them, but I wouldn’t invest in them or hold them,” he said. “The price may go up in the short-term, but there’s no reason it would in the long-term. In the short-term it’s just supply and demand – people jumping on the meme-coin.”
CEO Adam Aron and the folks over at AMC Entertainment (NYSE:AMC) sure know how to excite retail investors. The movie theater chain just announced second-quarter revenue that beat expectations. However, there is more to the AMC stock story than that. As InvestorPlace Assistant News Writer Brenden Rearick highlighted, news of AMC accepting Bitcoin (CCC:BTC-USD) is generating buzz.
This points to the fact that the first half of the year has been huge for AMC. The movie theater chain has been battling the impacts of Covid-19, fighting off debt, and becoming the star in a market-gripping story about short squeezes. Along the way, AMC and its CEO have embraced retail investors.
With this all in mind, Aron shared big news today of AMC accepting Bitcoin as a form of payment by the end of this year. He said the company would accept BTC at all U.S. locations. In addition to this, he also shared it would accept Google Pay and Apple Pay for online purchases.
Although he did not have many specifics, this clearly tickled retail investors. Another big announcement from the call is news AMC is working on some sort of partnership with GameStop (NYSE:GME), such as an in-theater gaming event.
What to Know About AMC Accepting Bitcoin
Right now, there is not a ton of detail around the latest AMC stock news. However, it comes at a key time for Bitcoin and other cryptocurrencies. Just as the earnings call was kicking off, the Senate shot down a compromise that would clarify a new tax proposal on crypto transactions.
But beyond that, it also comes at a time when companies like AMC are eager to cater to retail investors. Embracing Bitcoin… and a partnership with GameStop… are both great ways to do that.
So what is the bottom line? It is unclear yet what exactly will come of this news, but it may not be the end of the AMC-crypto story. Earlier this summer, Elon Musk signaled his support for AMC to start accepting Dogecoin (CCC:DOGE-USD).
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Sarah Smith is the Editor of Today’s Market with InvestorPlace.com.
Even though Bitcoin price continues to surge higher, investors are worried that regulation could erase the recent gains, but derivatives indicators show no sign of confidence from the bears.
The proposal mandates that digital asset transactions worth more than $10,000 are reported to the Internal Revenue Service, including validators, miners, and protocol developers. However, Senator Cynthia Lummis and Senator Pat Toomey are lobbying to focus those requirements exclusively on brokers and the exchanges.
Holders keep ‘hodling’ and inflation benefits the crypto market
On-chain analysis firm Glassnode highlighted that coins held for 12 months and longer are not being moved despite the strong rally, indicating a “holding behavior.” Meanwhile, the Crypto Fear and Greed Index, a well-known indicator that tracks volatility, volume, social media, dominance and Google searches, moved from “moderate” to “greed.”
The 74 point indicator reached on August 8 was the highest level since April 18, indicating that investors firmly believe that the bottom of this cycle is behind us. The index ranges from 0 (extreme fear) to 100 for maximum greed.
It is worth noting that the United States Bureau of Labor Statistics will release July’s inflation report on Wednesday, with markets forecasting a 0.5% increase. Cryptocurrency markets also reacted positively after Federal Reserve chairman Jerome Powell failed to explain how the 5.4% year-over-year increase on the consumer price index (CPI) would recede.
Margin and futures markets show little activity from bears
Analyzing derivatives indicators can help confirm whether these positive expectations are reflected in professional traders’ data. The first one is the Bitfinex margin long ratio, which drastically changes when bearish bets are made.
The above chart shows that after a brief period from July 9 to July 19, Bitfinex margin longs were back at 90% or higher. However, the ratio has not seen a downturn since then, displaying a lack of confidence from bears.
Bitfinex margin traders are known for creating positions of 20,000 or higher BTC contracts in a very short time, indicating the participation of whales and large arbitrage desks.
Next, analysts should evaluate the futures market by measuring the percentage of top clients either betting on the upside (longs) or downside (shorts). Keep in mind that the outstanding amount in longs and shorts contracts are balanced at all times in futures markets.
Bybt consolidates futures markets data from Binance, OKEx, and Huobi top traders. The current 1.14 indicator favors longs by 14% among those exchange’s largest users. Therefore, there has been a significant change over the last 12 hours because these traders were previously net short.
Both the Bitfinex margin and derivatives exchange futures markets point to a lack of confidence from bears right as Bitcoin breaks through the $45,000 resistance. This suggests that the recent 20% rally is well-founded and not simply a blip or the result of heavy liquidations.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Bitcoin (BTC) price soared to a 3 month high at $46,293 after bulls confirmed that they intend to take full control of the market. While crypto traders might be in the green again and pro traders are looking to add larger leveraged positions, no every class of investors to obtain direct exposure to Bitcoin.
For institutional investors, a fund administrator sets the rules for what percentage of the portfolio is invested in various asset classes and different companies have varying appetites for risk. Reasons investors may be piling into these assets versus simply holding BTC include the aforementioned restrictions and the regulatory uncertainty surrounding the purchase of Bitcoin directly.
Because of this, a number of entities are restricted from investing directly in Bitcoin and other cryptocurrencies but there are other ways to obtain exposure to the crypto sector.
Companies that specialize in Bitcoin mining have also generated immense profits and a handful are listed and can be an off-set play for investors looking to gain some exposure to BTC in their stock portfolios.
The recent miner crackdown in China has led to a more distributed mining network and prompted several rounds of fundraising and expansion for listed Bitcoin mining companies that could potentially benefit from the reshaping of Bitcoin’s global mining network that is likely to continue for years to come. Here’s a few listed companies that offer investors exposure to Bitcoin.
MicroStrategy’s bet on Bitcoin provides a boost
The software company MicroStrategy (MSTR) and its CEO Michael Saylor have become well known across the cryptocurrency sector for his wild support for Bitcoin as a store of value and the massive amount of BTC the company purchased in the last year.
Along with helping educate the world about the promise of Bitcoin and blockchain technology, MicroStrategy has amassed a Bitcoin portfolio in excess of 105,000 BTC in its treasury as a way to hedge against inflation.
As a result, MicroStrategy’s stock price has become somewhat correlated with the price performance of BTC and it has been observed moving in tandem with the top cryptocurrency.
As seen in the chart above, the price of MSTR reached a low of $474 on July 20, the same day as the low in Bitcoin, and has since increased 65% to trade at $781.
Bitcoin mining stocks soar
Listed companies that specialize in Bitcoin and cryptocurrency mining have also benefited from the price growth in BTC.
Perhaps the most well-known Bitcoin mining firm is Riot Blockchain, a company that operates warehouses full of ASIC miners to help process transactions on the network in return for BTC rewards.
Since hitting a low at $23.86 on July 20, the price of RIOT has increased by 66% and reached an intraday high at $39.94 on Aug. 9.
Another company that focuses on Bitcoin mining as well as purchasing BTC with its treasury holdings is Marathon Digital Holdings (MARA).
Data from TradingView shows that after reaching a low of $20.52 on July 20, the price of MARA has rallied 83% to an intraday high of $37.77 on Aug. 6, making MARA the top-performing Bitcoin mining stock over the past two weeks.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
As Bitcoin goes, so go the Blockchain exchange-traded funds that are in the crypto world’s orbit.
The ETFs, which invest in businesses with crypto ties, have shot up in the past week along with the most well-known digital money. Bitcoin broke above $46,000 on Monday, soaring ahead of the Senate vote on the infrastructure bill. The crypto is now at its highest level since May.
All are highly concentrated funds, with 20 to 50 stocks in companies expected to profit from crypto industry development. That includes Bitcoin miners; transaction and trading platforms; custodians; firms developing private blockchains; and other beneficiaries like chip makers and warehouses for mining machines.
Investors need to be cautious about the differences in the funds, though.
The Amplify ETF, for example, is actively managed and—with its 43 holdings—the most diversified among peers.
The VanEck and Bitwise ETFs are both index funds, and invest in companies that derive significant revenue from their crypto business or hold large amounts of crypto assets. More than 70% of their portfolios overlap, but the VanEck fund charges 20 percentage points less.
The Global X fund is the latest and cheapest, with a 0.50% expense ratio. It doesn’t own crypto-holding companies like MicroStrategy
(MSTR) and has a higher weight in Chinese firms.
Bitcoin’s latest surge comes ahead of the Senate’s vote on the infrastructure bill, expected sometime on Tuesday. The measure includes a provision about the tax-reporting requirements for cryptocurrency brokers and exchanges. Congress aims to raise $28 billion in revenue from crypto transactions to help pay for $550 billion in new infrastructure spending.
Crypto advocates have lobbied hard against the bill’s language, which doesn’t exclude miners or software developers from the definition of crypto brokers. This could prompt an exodus of the industry to offshore locations, they argue. The amendment is expected to be revised, and the crypto market is rising on signs that the industry is getting more allies on Capitol Hill.
The crypto industry might have better luck with the Securities and Exchange Commission, too. The agency has recently approved the Bitcoin Strategy ProFund (BTCFX), the first mutual fund that invests in Bitcoin futures, and Chair Gary Gensler signaled openness for futures-based Bitcoin ETF in a speech last week. Fund companies are moving fast.ProShares and Invesco
have already submitted plans with the SEC to launch ETFs based on Bitcoin futures.
Still, many investors are hoping for a physically backed Bitcoin ETF, which would eliminate the unnecessary layers of middlemen and derivatives. An ETF focused on Bitcoin futures would require investors put down a substantial amount of money on margin to trade.
Among exchange traded funds, the Innovator IBD 50 (FFTY) traded down less than 0.1% Monday. Nasdaq 100 tracker Invesco QQQ Trust ETF (QQQ) moved 0.1% higher. Meanwhile, the SPDR S&P 500 ETF (SPY) lost 0.2%.
Stock Market Rally
The Dow Jones industrials and the S&P 500 eased from Friday’s record highs, while the Nasdaq recovered a part of Friday’s modest losses.
Friday’s Big Picture column commented, “The market trend remains in a confirmed uptrend. Leading growth stocks are mostly acting well, like Advanced Micro Devices (AMD), which triggered the eight-week hold rule the past week. But there are some recent losers. Roku (ROKU) triggered the 7%-8% loss-cutting sell rule from a 463.09 buy point last week.”
(Be sure to check out Thursday’s Big Picture for a detailed breakdown of how to manage exposure in the current stock market.)
The price of Bitcoin briefly surged above $46,000 before paring some gains. Bitcoin traded around $45,700 in morning trade, according to Coindesk.
The Grayscale Bitcoin Trust ETF (GBTC) advanced almost 5% and is moving further above its 50-day moving average line.
Dow Jones Stocks To Buy And Watch: Home Depot
Dow Jones leader Home Depot is trying to break out past a cup with handle’s 333.55 buy point, according to IBD MarketSmith chart analysis. The 5% buy area goes up to 350.23.
Shares dropped 0.4% Monday morning.
Stocks To Buy And Watch: MercadoLibre, Square, Twitter
IBD Leaderboard stock MercadoLibre is trading right at a 1,755.05 buy point following Thursday’s nearly 14% surge. Shares dipped 0.1% Monday. Per Leaderboard analysis, the stock’s first 5 minutes of trading notched a high of 1,755.05, setting an alternate entry for aggressive investors. MELI is trading at a reasonable level above that price. A trend line within the base may also offer another early entry point.
The stock is also building the right side of a cup base, according to IBD MarketSmith chart analysis. Another possible entry looms at 2020.10. And be on the lookout for a potential handle to offer a more risk-optimal buy point.
IBD SwingTrader stock Square is back in buy range past a 267.87 buy point in a cup-with-handle base amid Monday’s 0.5% gain. The 5% buy zone goes up to 281.26.
Social media giant Twitter is approaching a double-bottom-with-handle’s 73.44 buy point. Shares are about 5% away from the entry following Monday’s 0.3% loss.
Tesla stock rallied over 2% Monday, looking to rebound from Friday’s sell-off. Early Monday, Jefferies upgraded Tesla from hold to buy, raising the price target from 700 to 850. The electric-vehicle giant is rebounding from support around its 50- and 200-day moving averages. Another strong show of support at these levels was bullish for the stock’s prospects.
Shares are trying to move back above a 700.10 aggressive buy point deep inside a correction. Meanwhile, a deep, large base continues to take shape.
On Jan. 25, Tesla stock hit a record high at 900.40, after climbing as much as 93% from a 466 buy point in a cup with handle.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple moved down 0.1% Monday, on pace to add to Friday’s 0.6% loss. The stock hit an all-time high on July 15 at 150. Apple stock remains out of the 5% buy zone from a 137.17 entry in a cup base. On a weekly chart, IBD MarketSmith chart analysis also places a buy point at 145.19 in a consolidation, which would put Apple in a buy range through 152.45.
Software giant Microsoft fell 0.2% early Monday, but remains just off record highs. Microsoft continues to trade solidly above a cup base’s 263.29 buy point. The stock is extended above the 5% buy zone, which goes up to 276.45.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
BITH11, a new exchange-traded fund (ETF) launched in Brazil by crypto-focused alternative investment firm Hashdex Asset Management, claims to be the country’s first “green” Bitcoin ETF.
The fund plans to neutralize its associated carbon emissions through purchasing carbon credits. To meet the ETF’s objectives, Hashdex has partnered with Germany’s Crypto Carbon Ratings Institute (CCRI) — which will produce annual reports estimating the energy consumption and carbon emissions underpinning the creation of BTC acquired by the fund.
The ETF is currently aiming to invest 0.15% of its liquid assets into carbon credits and eco-friendly technologies every year. The fund was launched on the B3 Brazilian Stock Exchange late last week under the ticker BITH11.
According to a rough translation, Rogerio Santana, relationship director at the São Paulo-based B3 exchange, stated:
“The new ETF offers investors exposure to variations in the world’s main digital asset, with all its growth potential and value reserve, in a regulated, secure manner and under sustainability goals,”
Hashdex is an issuer of regulated crypto investment funds, having launched its first crypto-focused ETF, HASH11, in April of this year. Over the past month, HASH11 has gained 33% according to Bloomberg.
In addition to HASH11 and BITH11, Hashdex also offers a weighted Nasdaq Crypto Index (NCI) fund tracking BTC, and its Bitcoin Risk Parity Gold Fund.
Bitcoin (BTC) reached its highest level in more than two months with just a few days remaining before the July inflation report.
The top cryptocurrency climbed 1.65% to $45,363 on Aug.8, continuing the upside momentum that has already seen it jumping 21.62% from its August 5 low of $37,300.
Momentum was strong among the Bitcoin rivals as well. Ether (ETH), the second-largest crypto by market cap, increased 29.78% from its Aug. 3 low of $2,630, crossing over $3,100 on Sunday. Its gains came after Ethereum’s London hard fork went live on Aug. 5, which should add deflationary pressure to the supply of ETH.
July inflation report, on-chain
On Wednesday, Aug.11, the United States Bureau of Labor Statistics will release July’s inflation report, with markets forecasting a 0.5% spike. The projections appear after the consumer price index (CPI) jumped to 5.4% year-over-year in June to log its biggest increase in 13 years.
Bitcoin bulls have responded positively to the recent inflation reports. They effectively guarded the cryptocurrency against falling below $30,000 after the May 19 crash. Meanwhile, their recent efforts to push the prices above $40,000, eventually leading into a slow upside break above $45,000, indicates strong demand for Bitcoin, which appears to be breaking out of its summer slump.
Lex Moskovski, chief investment officer at Moskovski Capital, highlighted a Glassnode chart that showed dramatic spikes in entities entering the Bitcoin network, matching the growth with the rising BTC/USD rates.
“Amount of new Bitcoin entities continues to hit all-time high,” Moskovski tweeted.
Additionally, on-chain analyst Willy Woo said the ongoing Bitcoin momentum should push its prices above $50,000, citing supply-demand imbalance in the market. He said that all investor cohorts were buying Bitcoin, which led to supply shock.
Woo referred to a chart he posted on July 15 when Bitcoin market was correcting lower after peaking out sessional at $36,675. The graph, as shown below, highlighted events of Bitcoin liquidity shock across all the exchanges and their relation to the prices.
“Fundamentals do not predict short-term price, but given enough time price discovery reverts to fundamentals. [The] exact value is $53.2k today, with a standard deviation band between $39.6k – $66.8k (68.5% confidence).”
However, the latest Bitcoin climb does carry risks of becoming a dead cat bounce based on previous top-to-bottom Fibonacci retracement fractals.
After setting up record highs, Bitcoin tends to correct toward its 200-week exponential moving average (200-week EMA; the yellow wave), where it eventually bottoms out to pursue another bullish cycle.
In the past two events, the BTC/USD exchange rate posted fake recovery rallies after testing the 23.6 Fib line as support. Those upside moves failed short of turning into big bullish momentums after facing resistance at higher Fib levels.
For instance, in 2019, Bitcoin rebounded by more than 50% after bouncing off from its 23.6 Fib line near $7,357. But the cryptocurrency faced extreme selling pressure near its 61.8 Fib line of $10,613. Eventually, it resumed its downtrend and crashed to as low as $3,858 in March 2020.
If the fractal repeats, Bitcoin could face extreme resistance at 61.8 Fib level at $46,792 and correct lower to retest its 200-day EMA, which currently sits below $20,000.
Independent market commentator and trader Keith Wareing suggested that an imminent bullish crossover between Bitcoin’s two weekly moving averages hints at the beginning of a multi-month bull run. Dubbed as MACD, the indicator was instrumental in predicting the 2020 bull run.
“The weekly MACD is due to cross bullish on Bitcoin after tonight’s close,” opined Wareing to his followers with the price of Bitcoin so far maintaining above $44,500 at the time of writing.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.