At the dawn of the crypto market, when specialists were trying to create a framework for cryptocurrencies and categorizing them as an asset class. As part of the categorization, specialists in economics had to understand and analyze the behavior of crypto assets as a type of market class and approximate it to existing assets and their established fundamental analysis theories.

Analyzing Cryptocurrencies – The Class

Analyzing cryptocurrencies is just as an art as it is process of mathematical sifting, since they are unlike any other asset or commodity that has ever been developed or market fielded. A shining example successful categorization of cryptocurrencies as an asset is the case of Bitcoin itself, which has long been considered an asset class in its own right. The king of cryptocurrencies has been outperforming every other asset in history by its price dynamics. And yet, it has shown to demonstrate behavior similar to the behavior of traditional financial assets, such as currencies on Forex exchanges. However, historical data and in-depth analysis of formulated historical price charts of Bitcoin has proven that the cryptocurrency is more of a commodity than a currency when it comes to its behavior analysis.

Being by virtue highly susceptible to external triggers, like announcements of adoption by major companies, or large inflows of investment from major funds, Bitcoin can be correlated to oil, which is just as susceptible to geopolitical events and reacts violently in price. Bitcoin’s price hikes outstrip those of oil greatly, but the digital currency is as much perceptive of the real, base economic principles that set it aside as a commodity – in essence – an abiding element of classical economics.

Bitcoin is a carrier of intrinsic value, as most coins and stablecoins on the market, and that means that it beats intrinsic value and abides by the laws of supply and demand, since it, as an asset with limited emission, is also scarce.

Cryptocurrency Fundamental Analysis

Intrinsic value can be established by defining the fundamental value of an asset The effort takes into account the various factors affecting the overall valuation of an asset to determine its valuation as high or low.

Cryptocurrencies are also subject to fundamental analysis. But unlike traditional assets that have their value determined through such indicators as price per share or earnings per share, cryptocurrencies have their own set of metrics. Technical analysis has also been adapted to cryptocurrencies by traders, who have established that most digital assets trace the same behavior on market charts as traditional tradable assets, like fiat currencies. This makes it possible to apply such analysis techniques as MACD, Moving Averages, Candlesticks and other indicators to cryptocurrencies.

Cryptocurrency Fundamental Analysis Metrics

The main metrics used for conducting fundamental analysis of digital assets can be divided into on-chain and off-chain sets.

On-chain factors for cryptocurrencies include important numerical factors, essentially, transparent and available for viewing by anyone online. These include such figures as the total number of conducted transactions for a certain cryptocurrency within a timeframe, the total value in all transactions for some period, the total number of users holding the cryptocurrency, the current hash rates and amounts of the asset staked, and, most importantly – the fees paid for said asset.

Commission fees are extremely indicative as clear evidence of demand for some specific cryptocurrency. Supply and demand are the factors determining the price for assets, be it Bitcoin of traditional assets.

Off-chain metrics for a cryptocurrency are reminiscent of the stimulants that can affect the price of oil. For digital assets, off-chain factors are the likes of the wholesomeness and performance of the issuing project, the total inflows of investments, positive news backgrounds, major update or partnership announcements, adoption rates, and others.

The Financial Metrics

The financial indicators of a cryptocurrency are just as critical, which include total market capitalization, its liquidity and trading volumes, and the total available supplies. The combination of these metrics illustrates the fundamental value that a cryptocurrency bears and allows investors to assess whether their object of analysis is performing well, or poorly.

Conclusion

Metrics, fundamental or technical analysis separately is not capable of acting as reliable proof of a digital asset’s performance, just as with traditional assets. The combination of financial performance over time with the internal and external factors create an overall image of a digital asset and give investors clear guidelines on whether an asset is worth investing in – in conjunction with their own intuition and experience.

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Last week we predicted that Bitcoin would test the $60k strong resistance zone, and if it failed to break/hold above this – it would retrace and test support levels closer to $50k. This seems to be exactly what played out and what continues to play out on the charts this week! Let’s take a look and see how our predictions/analysis worked, and see if we can continue to decipher the trends. 

BTC/USD 4H Chart from Tradingview

As you can see, Bitcoin did in fact break the previous high of $58k and briefly traded as high as $62k before failing to hold the $62k level upon the first retest. Because of this, Bitcoin has been trending down, currently trading at $55k. Our prediction that holding above $60k was unlikely proved out to be true – largely since the market is heavily overbought and a bearish signal on the moving averages. 

(BTC/USD 4H Chart with Moving Averages from LAST WEEK) 

Price Analysis

Last week we saw the moving averages in the chart above and saw that the 100MA was flat/slightly down and was coming up on a bearish cross with the 200MA. 

BTC/USD 4H Chart, UPDATED

If we look at the updated chart for this week, we see that the 100MA line (light blue) changed direction and did not complete the bearish cross with the 200MA line (yellow). While the bearish situation did not fully complete, it remains close if this downtrend continues. The 200MA line has been strong support during this uptrend (see around Mar 1) and will most likely continue to be around the $50-51k mark. 

BTC/USD Daily Chart from Trading View

Looking at the long-term daily candle chart, it’s clear that despite these pullbacks in price we are still in a bullish situation. The closest support according to moving averages is around $52k (20MA). 

BTC/USD 4H Chart with RSI

Lastly we will use the RSI on the 4H chart to determine if we are overbought/oversold for the week. Last week it was clear that we were overbought and due for a correction – which happened. This week we can see that the correction has definitely begun, but we are still in the purple zone – which means we have a little ways to go before becoming oversold.

Investor Sentiment

We are still in the “greed” zone – which has climbed up a bit from 68 last week to 71 today. This is probably due to Bitcoin minting its new ATH, but overall is a signal that further price reductions are likely for now. 

Fundamental Analysis

Total Hash Rate, taken from Blockchain.com

The Total hash rate continues to be strong, declining slightly from last week but still up about 50% from where it was this time last year. This indicates that the mining cost (inherent value) of Bitcoin remains strong. 

It was reported last week that Chinese app Meitu bought $40 million worth of Bitcoin and Ethereum, indicating that institutional investment into cryptocurrencies continues to rise. This is a long term bullish case. 

Conclusion

It appears we are in a short term down trend, and that we will test the $50-52k support zone. This should be a strong support, as it is a combination of moving average, RSI, and psychological support zones. If this support somehow fails, we will likely continue trending further down. Otherwise if it holds, expect a retest of $60k. 

The post Bitcoin Analysis – Week of March 13 appeared first on Midas.Investments. Crypto investment company blog..

It’s been a few weeks since our last Bitcoin Analysis piece, but we are back and ready to dive back in! Bitcoin has been up to a lot since our last article, which was published in early December when Bitcoin was still trading under $20k. We had predicted in the past that a price target for Bitcoin this cycle was around the $50k mark – and we were correct! Bitcoin has fluctuated around this price point, and seems poised to test new highs. Let’s take a look at the charts, as well as conduct some fundamental analysis and see if we can predict future trends! 

Price Analysis

BTC/USD 4H Chart taken from Tradingview

Bitcoin has ranged in the 40-50k zone since it crossed this threshold in early February. It now appears to be approaching the $58k mark, which was our previous high. If the price breaks and holds above the $58k resistance, we could see Bitcoin test $60k. If Bitcoin fails to break $58k, it is likely we return to the $50k price point to test support. 

Looking at the moving averages, we can see that the yellow 200MA line acted as strong support after the initial fall from $58k. This 200MA has continued to rise, and is now positioned between $48-50k. This is our support zone. 

A looming bearish sign is the flatlining 100MA, which could soon push a bearish cross beneath the 200MA. Remember, whenever 20MA>100MA>200MA, we are in a bull cycle (for a given timeframe). Likewise, whenever 20MA<100MA<200MA, we are in a bear cycle. If Bitcoin fails to break above 58k and retraces, we could see a death cross scenario. 

BTC/USD 1D Chart from TradingView, Moving Averages Shown

Looking at the much larger 1D chart, we can see that the market has been highly bullish for a long time – and we are way above our support levels. The 100MA is currently sitting at $35k and the 200MA at $23k. If we move into a bear cycle, look to these areas as key support levels. 

BTC/USD 4H Chart, RSI shown

The Relative Strength Index (RSI) is one that we often use to determine if the market is overbought or oversold in a given timeframe. Whenever the index trades above the purple zone, we are overbought, and likewise oversold when trading under the purple zone. As it stands, we are overbought – meaning we are likely due for a correction soon. This makes it look unlikely that Bitcoin will break the $58-60k zone resistance, but stranger things have happened. 

Investor Sentiment 

Fear/Greed Index, taken from Alternative.me

The Fear Greed index is one that we often use to predict large market movements. We have been in the “extreme greed” territory for the past several months, but we have now entered the “greed” territory. Generally speaking, “extreme greed” means that we will correct down. However, “greed” is not a strong indicator by itself and could easily go back to “extreme greed” zone. 

Fundamental Analysis

Taken from Blockchain.com

Bitcoin’s hash rate continues to be strong – climbing back upward toward its yearly high of 165m TH/s, which was achieved on Feb 8. A high hash rate means that the network’s electricity consumption is high – keeping the mining cost high (and subsequently, Bitcoin’s inherent value). 

Fundamentally, Bitcoin continues to be very strong – with institutional investment continuing on a daily basis. Today alone, Israeli Pension Giant put $100M into Grayscale, and the newly passed stimulus in the United States has pushed Bitcoin closer to its all time high. This comes on the heels of big companies such as Tesla, who have diversified a portion of their company holdings into Bitcoin. 

Conclusion

Bitcoin’s latest bull run has brought us to record highs, and it may not be over yet. It’s looking like it will retest its all time high before making a decision point. The indicators seem to predict that it will not break the $60k level before retracing, but anything can happen. The market remains greedy, and is becoming heavily overbought. Look at $60k as a strong resistance, and $50k as support. 

This is not investment advice. Article is intended for education and entertainment only. Do your own research.

The post Bitcoin Analysis – Week of March 7 appeared first on Midas.Investments. Crypto investment company blog..

After a one week hiatus, the weekly Bitcoin Price Analysis articles are back! The market has been very active over the past two weeks, so there is a lot to get to! Let’s get started. 

Last week we said: 

Last week we saw a rather bearish scenario, but since the $10k level held we now see either a consolidation phase (neutral wedge) forming, or the confirmation of a bull channel. With investor sentiment neutral and/or slightly fearful, there certainly will be buyers at this price level. Combine this with extremely strong fundamentals and the bull case for BTC is quite strong at this moment. To confirm the bull channel, a return to $12k is needed. Likewise, both theories could be invalidated if BTC returns to the $10k level and fails to hold yet again. For now, it’s looking like the days of sub $10k BTC are over. 

We correctly predicted that Bitcoin was showing bullish signs, and the market has reacted accordingly – today pushing up above $11.5k! If the bullish trends continue, this could confirm that we are likely in a bull channel and that new highs are forthcoming! 

Price Analysis

In our last article, we showed a wedge forming on the 4H chart. Based off of indicators and sentiment, we saw that it was likely to break upward, which is exactly what is happening now. This move is likely to continue toward the $12k zone where it may consolidate before continuing upward. 

Zooming in on the same timeframe, we can see that the moving averages are confirming this bullish move, and all of them are inclined upward (bullish). 

The Daily chart gives us a more macro-view of the price action. As you can see, the price bounced multiple times off of the 100MA (light blue), which has acted as strong support for the bull trend. The 20MA (which acts as our short term indicator) never crossed below the 100MA, meaning that the trend is still in tact and may now resume after repeatedly testing support. All averages are still inclined upward. 

Looking at the RSI, we can see that the price has more room to grow before becoming overbought. Currently, the RSI is around 65, which is slightly overbought but not overly so. The last time BTC was at this price level, it was heavily overbought and needed to slow down and recharge. This is no longer the case. 

Investor Sentiment 

This is an incredibly bullish sign. Even with the recent move upward, the market is still “Fearful” by a significant amount – meaning that the price still has significant room to grow. Remember, we tend to take a contrarian mindset. When this reads “fear’ we buy and when this reads “Greed” we sell. 

There is more than one fear/greed index for the crypto markets. We look at more than one so that our view of the market is not biased. While these indexes sometimes agree, right now it appears that Alternative.me is slightly more greedy than BTCtools.io. Still, this confirms that the markets have not yet reached “greed” status. 

Fundamental Analysis

Bitcoin continues to post strong fundamentals, with the Hash Rate remaining near all time highs. This is good news for bulls, as a high hash rate means the inherent value of Bitcoin remains higher than market price. 

Miners revenue remains relatively low, and has actually decreased a bit over the recent spike due to transaction fees being so low. Remember, there are multiple variables that affect Miners Revenue, including the price of Bitcoin, Hash Rate, and transaction costs. Since revenue is relatively low compared to the past, either the price/transaction cost have to increase or the hash rate has to decrease – which would result from a decline in miners competition. With interest in blockchain rising, competition is unlikely to go down anytime soon – meaning that Bitcoin must continue to rise in price! 

Interesting News

CoinDesk reported last week that Square had purchased 4,709 Bitcoins ($50M) and planned to hold them as a company asset. The company said in a statement, “Square believes that cryptocurrency is an instrument of economic empowerment and provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose.” This is an interesting development that is sure to catch the attention of other large tech companies, and signals that institutional interest in Bitcoin continues to rise. 

Conclusion

Bitcoin is making significant headway on the charts, and all indications are that it will continue. With bullish price action, a fearful/neutral sentiment and rock solid fundamentals paired with growing institutional investment, Bitcoin’s moon mission 2.0 looks ready to launch. 

It’s looking increasingly likey that Bitcoin is in a new bullish channel (shown in green). The key level to test is shown by the red horizontal line in the image above. If Bitcoin fails to make a convincing break above that level, it will have formed a double top and will likely consolidate before choosing a direction. A break above $12.2k would confirm the channel and a rise to $13k is likely. Likewise, the price falling below $10.5k would invalidate the channel and signal a consolidation period. 

• TLDR
• BULLISH

This article is not investment advice, and is intended only for educational and entertainment purposes. Always do your own research before making an investment decision, and consult your financial advisor. 

The post Bitcoin Price Analysis – Week of October 11 appeared first on Midas.Investments. Crypto investment company blog..

Last week we said: 

BTC is testing $10.4k, but with an imminent death cross on the local hourly chart, a retest of the 10k zone is possible if not likely. I would expect this to be a quick touch, “wicking” below the 100MA on the daily chart but closing the day above 10.4k.

Could our analysis get any better?? Once again, we hit the nail on the head with our prediction. Just like we predicted, BTC wicked down to the strong $10k support zone, reaching a low of $10,137 before rocketing above the $10.4k zone: 

After finding support in the 10.3-10.4k zone, BTC shot up again, forming a double top at $10940 and then retracing: 

Since the local top, the top cryptocurrency has been trading in the 10.6k – 10.7k range, forming a consolidation pattern and gearing up for its next move. Let’s continue our weekly analysis and try to get a leading edge on what the market will do in the coming days! 

Price Analysis

From the 4H chart we can already see that BTC is forming a wedge pattern, which in this case I would view as bullish. Since the wedge is a neutral wedge and the support is trend support, the likelihood is that it will break upward just as it did in our last wedge. Markets tend to perform in cycles. 

Another possible scenario is that Bitcoin is forming a long term bull channel on the 4H chart. This would be confirmed by a move back to the $12k price level. 

The 1D candle chart makes the bull channel even clearer, especially with the 20MA bouncing off of the 100MA as support. If BTC makes a strong move upward in the coming days, this theory could be confirmed. If not, expect a longer consolidation period. 

Investor Sentiment 

The Fear Greed Index is still showing “fear” – indicating that the market may not have topped out yet. Remember, we always trade contrary to the market sentiment. A contrarian mindset when trading can be quite profitable. Never trade out of emotion. 

Both indexes agree that the sentiment is slightly fearful. This is slightly less fearful then last week, which measured around a 39 on both sites, which should be expected since the market moved upward. Since the dials are not showing “greed” – I view this as slightly bullish. 

Fundamental Analysis 

The mining hash rate has declined a bit since last week, but is currently rebounding. Still, levels are near all time highs, which is bullish if you believe in the inherent value of Bitcoins. This means that competition for mining Bitcoins is at an all time high, and so is Bitcoin’s carbon footprint! The inherent value of BTC is directly correlated with the amount of electricity it takes to mine one (mining cost). 

Even still, compared to all time high mining revenues, currently miners are not making much. This is largely due to the block halving. Keep in mind that miners are good traders, and would sooner stop mining than sell at a loss. For BTC to return to all time high mining revenues, the price would have to nearly 5x. 

Conclusion

Last week we saw a rather bearish scenario, but since the $10k level held we now see either a consolidation phase (neutral wedge) forming, or the confirmation of a bull channel. With investor sentiment neutral and/or slightly fearful, there certainly will be buyers at this price level. Combine this with extremely strong fundamentals and the bull case for BTC is quite strong at this moment. To confirm the bull channel, a return to $12k is needed. Likewise, both theories could be invalidated if BTC returns to the $10k level and fails to hold yet again. For now, it’s looking like the days of sub $10k BTC are over. 

Always do your own research before making an investment decision. This article is for educational and entertainment purposes only. 

The post Bitcoin Price Analysis – Week of September 27 appeared first on Midas.Investments. Crypto investment company blog..

Good Day Midas community! 

The markets have been very turbulent in the time since our last article. ICYMI, our conclusion in our last analysis was: Short term pain, long term gain. In other words, we thought that further price retracements below the $11.2k level were quite likely before Bitcoin continues its bull trend. 

Our hunch was correct. This is exactly what played out in the markets. 

Let’s take a look at what the charts and fundamentals are telling us, and see if we can continue to predict BTC’s movements. 

Price Analysis

At the time of writing our last article, Bitcoin was trading around the $11.2 – 11.3k level after testing the $12.4k resistance zone. As we predicted, the markets have experienced a lot more “pain” – further retracing in price to the current $10.2k mark. As we know, the $10k price level serves as extremely strong resistance/support, as it is a key psychological number. Over the past week, Bitcoin has tested the $10k level multiple times, as represented by the several “wicks” that reached as low as $9.8k. Since Bitcoin has consistently bounced back above this level, I view it as a strong confirmation that $10k is a strong support level. The support range is from $9.8k – 10k. 

Here we take a closer look at the price movements by looking at the 1H candle chart. The solid green line is the strong $10k support level. We also can see the moving averages in this chart. 

While the moving averages aren’t necessarily bullish, the 20MA is now preparing to cross above the 100MA, which is flattening out. This could mean that the worst is over, and Bitcoin will trade sideways for a bit as it refuels to test resistance levels. 

To get a Macro view, we will apply the same criteria to the daily chart. We can see that despite the recent pullbacks, the bull trend dating back to March is still in tact. The moving averages are still bullish, but if BTC breaks below $10k, support will be found around $9k, where the 200MA currently sits. 

Investor Sentiment 

As we know, Bitcoin’s price is largely driven by how the crypto community feels. We typically use the Fear/Greed index from Alternative.me. Let’s take a look: 

As you can see, last week the market went from “extreme Greed” to “fear” rather quickly. However, the index read basically flat after the initial drop. Here is a plot of the FGI over time: 

The Index changed from 79 to 41 overnight, where it has stayed for most of the past week. However, in my opinion this change does not reflect the true fear of the crypto community. 

There is another Fear/Greed index that we will take a look at, and perhaps take an average of the two. 

This additional index shows a sentiment of “Extreme Fear” which I think accurately encompasses the feeling of the crypto market over the past week. From this, we can gather that the market is Fearful/Extremely Fearful, which in general is a bullish sign for crypto. Remember, we want to do the opposite of what the markets are doing. 

Fundamentals 

This suspicion is confirmed by Bitcoin’s hash rate. Despite the dip in price, the network continues to grow and the hash rate is climbing. This means that the inherent value of Bitcoin is still trending upward. 

It’s important to keep in mind that Bitcoin miners tend to be good traders. If the hash rate is higher, we can assume that more electricity is being used to mine a single Bitcoin. If the cost to “mine” a Bitcoin is greater than the value of the Bitcoin, the hash rate will go down as miners are turned off. But if the hash rate is climbing while the price is dipping, we can assume that miners are going to hold their newly mined BTC and sell at higher levels. This is bullish. 

We can also see that the Bitcoin network continues to grow despite the decline in price. More people are using Bitcoin than ever before, which will be reflected in the value sooner or later. 

Analysis

Bitcoin has declined in price over the past week, but has held the $10k support level nicely. This, combined with the fearful market sentiment and strong fundamentals, indicates that the market is quite bullish at this point. I expect Bitcoin to trade sideways for a few more days before moving up toward $11k, and possibly $12k. If Bitcoin reverses and breaks below $10k, I expect to find support at $9k. 

TLDR

• Price Analysis: Neutral
• Sentiment: Bullish
• Fundamentals: Bullish
• Consensus: Bullish

Please keep in mind that all information in this article are for educational purposes only, and should not be taken as investment advice. Always do your own research before making any investment decision. 

The post Bitcoin Price Analysis – Week of September 6 appeared first on Midas.Investments. Crypto investment company blog..

Hello again Midas Investors! 

We will continue our series of weekly TA on Bitcoin and the crypto markets in general. If you’ve been involved in crypto for any amount of time, you are well aware that where Bitcoin goes – so does the entire market. Except for stablecoins, the movements of Bitcoin have a direct effect on nearly every other cryptocurrency. As such, prudent investors will keep their eyes on the market direction of BTC at all times. 

Price Analysis

Bitcoin has been retracing over the past week, dropping about 4% today alone. Currently, the top cryptocurrency is trading around $11.3k, and has yet to find a price support. Two weeks ago, we saw a price retrace to around $11.2k, before the price retested the $12k levels. Perhaps we will find support around that level. 

We get a slightly clearer picture of what is happening when we look at the 4H chart with moving averages. The 200MA (shown in blue) is a strong support level, and BTC is currently testing it. If BTC continues to close candles below this line, we might see further retracement. If a “wick” forms and the candle closes above the 200MA, a bounce is likely coming. 

The daily chart gives us a more macro-view of the trend. Despite the pullbacks, the uptrend is still quite strong, and all of the moving averages show bullish. Support levels for the 100MA and 200MA are around $10k and $9.2k, respectively. However, the red trendline could also be used as support, around the $10.7k level. 

Investor Sentiment 

Since Bitcoin is primarily a P2P traded instrument, market sentiment is king. In general we want to “buy” when the market is fearful, and “sell” when the market is greedy. Alternative.me provides a great index which measures this sentiment. Let’s take a look at what it says. 

Despite the week-long retracement, the market is still reading as “Greed”. However, last week it was at “Extreme Greed” – so there has been a slight pullback in sentiment. Keep in mind that this indicator is only updated once per day, and that today’s sharp price decline has not yet been “priced in” to the index value. I would expect that after today, the index would be much less greedy. Overall, the index suggests that we could see more short term pain. 

Fundamentals 

Bitcoin’s hash rate is a measure of the total number of miners contributing to the network. As you can see, the hash has declined from its all-time-high, but might be in the process of bouncing. The hash rate helps to determine the inherent value of Bitcoin, because in general the higher the hash is, the more electricity is required to generate one Bitcoin. 

Despite the long term upward price trend and hash decline, the Miners Revenue is still relatively low due to the block halving. I view this actually as a bullish sign, since the miners have every reason not to sell their rewards at this point. 

The last fundamental we will look at today is the number of unique addresses used on the Bitcoin blockchain. This is a raw indicator of how many people are actually using Bitcoin. With this number on an upward trend, we can be confident that Bitcoin is still growing, and will continue to gain value. 

Analysis 

With how quickly Bitcoin shot up over the past few weeks, we could see this price correction coming from a mile away. But, as long as we stay over the $10k mark, the upward trend will remain in tact. Since the block halving has historically been extremely bullish, I view this pullback as “refueling” for testing new resistance levels. The fundamentals are still incredibly bullish. 

TLDR

• Short term: Pain
• Long term: Gain
  

The information in this article is the opinion of the author and is intended for educational purposes only. Not investment advice. Do your own research. 

The post Bitcoin Price Analysis – Week of August 23 appeared first on Midas.Investments. Crypto investment company blog..

How Accurate Has our TA Been?

For those of you who have been following, we have published a series of ten Bitcoin TA articles over the past few months. These articles were written on a weekly basis, with the overall goal of determining the market direction for Bitcoin and Crypto in general. We hope that you have found the articles interesting, and that they have been a useful tool for you as you conduct market research. 

Technical Analysis: Art or Science? 

The particular method of Technical Analysis that an analyst uses will vary from person to person. Some may take a very measured, scientific approach, while others may use more of a “gut feel” and their experience to read the charts. The beauty is that there is no right or wrong answer! The only thing that matters is the final result. In our TA articles, we use a combination of factors, including chart patterns (price analysis), moving averages, RSI to determine overbought and oversold, investor sentiment, and blockchain fundamentals, essentially blending both art and science into a unique approach. 

So how effective has our analysis been? Let’s take a look at each week’s conclusion and see how accurate our predictions were. 

Week of May 24 – “Bitcoin is currently bouncing off of the short-term trendline, and will retest the $10k levels. If this level is broken, I expect the price to increase significantly, as Network Hash and Mining Revenue are at support levels…. If BTC breaks $10k, it could easily rocket to $12k. If it fails and the trendline breaks, a return to $8k is likely.” 

As you can see, we were correct! The price retraced, held the trend, and then retested the $10k levels. Accuracy: 1/1

Week of June 7: As we correctly predicted in our last analysis article, Bitcoin bounced off of the trendline and retested the 10k levels, which it failed to break. Since then, it has been trading in a narrow range, with a decision point coming in the next week. The $10k mark is a strong resistance, and if broken, BTC could easily test the $12k levels. If instead, BTC breaks downward, strong support will be found around $8.1k. 

Since price indicators and investor sentiment are both neutral, trading in this time is at an increased risk. Be sure to use tight stop losses and not to trade more than you are willing to lose. 

Let’s see how we did! 

Our advice was to use extra caution, and we predicted that if Bitcoin did not break the $10k levels, it would retest support. Thankfully, the price did not go all the way to $8.1k, but it did in fact retrace to about $8800. We’ll give ourselves a half point here. Accuracy: 1.5/2

Week of June 14: Last week we predicted that if Bitcoin failed to hold above the $10k level, the trend line would be broken and the price would test support levels. That is exactly what happened, leading to the recent correction to $8800. The recent spike to ~$9400 could be a good shorting opportunity for traders with a higher risk tolerance, with a target entry of $9450 – $9550. Long term, Bitcoin remains bullish, but traders should exercise extra caution until a clear direction is confirmed.

Here’s what happened: 

Our suggestion for risk takers to consider shorting around $9550 was a perfect entry (red box above) and would have been profitable if closed before the next week’s TA article was released. 

Accuracy: 2.5/3

Week of June 21: Since miners are not making as much money post-halving, a convincing and sustained break above the $10k level will be explosive. Nonetheless, the $10k mark has been an extremely strong resistance, and the price has failed to hold above this key level. Technical indicators as well as investor sentiment are all bullish, and I expect the price to retest the $10k levels in the coming days. Key support levels are: $9.2k, 8.8k. Key resistances are $9.6k, 9.8k, and 10.2k.

We read the market as bullish, and thought that Bitcoin would go up to challenge the $10k levels. We were right about the direction, but Bitcoin stalled out around the $9800 mark. We’ll give ourselves .75 of a point for this one. 

Accuracy: 3.25/4

Week of June 28: The $10k psychological resistance continues to evade Bitcoin, and the price is now consolidating yet again. After a failed attempt to break support last week, Bitcoin is in indecisive territory. On a short timeframe, technical indicators look neutral to bullish, but on the larger time frames, they look neutral to bearish. The best move now would be to wait for entries near the support zone, use tight stop losses, and exercise extra caution until Bitcoin determines a decisive direction.  

Since the advice for this week was to avoid trading and wait for a clear change of direction, we are going to skip this week. 

Week of July 5: Bitcoin continues to consolidate in an increasingly narrow range, indicating that a large move is getting closer. While many expected a “death spiral” to form after the block halving – the network hash is increasing. Bitcoin is showing its resiliency, and is currently undervalued. While sentiment and indicators are neutral or slightly bullish, Bitcoin’s fundamentals are strong. That being said, Bitcoin does not always perform as we expect it to. It’s the wild west. Be sure to use extra caution when taking your positions, and as always: NEVER INVEST MORE THAN YOU ARE WILLING TO LOSE. 

Again, we are going to skip this week since no clear prediction was called. We did, however, predict that a “large move” would be coming once Bitcoin broke out of the consolidation zone. 

Week of July 12: Bitcoin’s strong fundamentals tell me that once we break out of this consolidation zone, chances are it will be upward. This is not guaranteed, but a convincing break above the $9500 zone and then $10k with strong volumes will confirm the move. Otherwise, a break below $8600 and then $8k will confirm the opposite. Given Bitcoin’s low volatility, a break out of the consolidation zone could happen at any time. It’s important to exercise extra caution while trading until a direction is confirmed. 

Unfortunately, the market did not move much in this week, and no call was made. On to the next week! 

Week of July 19: Last week, we shared that Bitcoin’s “Hash Ribbon” indicator flashed its first “buy” signal in months. This signal was given on July 12.

Whenever this indicator has given a buy signal in the past, huge gains have followed in the weeks after. In 2017, it posted 93% returns in 122 days after the signal. In 2019, it made 277% in 166 days. In 2020, it made 45.3% in 48 days. What will it be now? 

The week that we made this “bullish” indication is when the fireworks started to go off on the chart! Definitely was a good call that week. 

Accuracy: 4.25/5

Week of August 2: After taking a one week vacation, we were back this week with the following analysis: 

Bitcoin has been responding predictably to the market indicators. After finding support levels above $9k in price, investor sentiment being slightly fearful, and the hash finding strong support, the only way Bitcoin could go was up. I expect that Bitcoin is out of gas for the moment, and will bounce around in the $10-12k range for a bit of time before making another move. Long term, I am very bullish on Bitcoin but a retrace to $10k is possible. If Bitcoin holds $10k, this is actually very bullish as it means that the strong resistance has turned to strong support. 

We predicted a short term correction before long term gains. At the time of writing, Bitcoin was closer to the red box in the image above. It very quickly followed our prediction, and dropped to the green zone before rebounding. 

Accuracy: 5.25/6

Week of August 9: While the fundamentals and price analysis look Bullish, the investor sentiment is clearly bearish for the short-to medium term. That being said, the market could stay greedy for a few more days and push Bitcoin higher before the “greed bubble” bursts and the price corrects. Personally, I would be very hesitant to enter a long position until the index turns back to neutral. However in the long term, I see the markets as very bullish for Bitcoin and believe we are in the beginnings of a new bull cycle that could take us to all time highs. The future is bright for crypto. Happy trading. 

Yesterday we said that in the short term, we were Neutral/Bearish, but still bullish in the long term. As you can see, today our prediction is playing out correctly, and Bitcoin is retracing its price. 

Accuracy: 6.25/7

TLDR;

Our goal was never to create buy and sell signals. Rather, the purpose of these TA articles was to determine overall market direction for both short and long term. If you have read these articles, you have enjoyed our highly accurate analysis, which was correct nearly 90% of the time. Hopefully you have seen the value of these articles reflected in your portfolio. 

As always, do your own research! 

The post Bitcoin TA Review appeared first on Midas.Investments. Crypto investment company blog..

Greetings Midas Community! 

Another week, another Bitcoin analysis article. As every crypto investor is well aware, the price fluctuations of Bitcoin are essential to understand the market in general. Bitcoin – the king of Crypto – largely determines whether the industry is bullish or bearish. In these articles, we are going to conduct price analysis, as well as fundamental analysis in an effort to dissect Bitcoin’s overall trend. Let’s get started. 

Price Analysis

To begin, we will look at the price fluctuations of BTC vs. USD on a large (4H) timescale. As we have observed in recent weeks, Bitcoin continues to consolidate between the 9k and 10k price points, preparing for what many expect to be a significant move in either direction. Many analysts believe that the longer Bitcoin trades in a low-volatility zone, the larger its next move will be. 

Zooming in on the past few weeks of action (still on the 4H candle chart), we can clearly see that a wedge is forming on the chart. Using the wicks to determine the trendlines, we can see that Bitcoin has consistently found support between the 8800-8900 zones, forming a pattern of higher lows and lower highs. This is a neutral trading pattern. 

On the much larger 1D time frame, we can see that this consolidation pattern has been forming for a long time, with higher lows and lower highs forming consistently over the past few years. This dates back to the 2017 bull run, which peaked around the $20k mark, and last year’s peak of $14k. The moving averages currently are bullish, with the 50MA and 100MA sitting above the 200MA. Most traders believe that as long as BTC stays above the 100MA level (currently around $8.6k) – it remains bullish in the mid term. 

Investor Sentiment

Fear and greed indicator is usually a contrarian indicator. When the majority of people are at one end, the market tends to cause maximum pain. Generally speaking, when people are fearful (most often after a rapid decline in price) – this is a good time to buy. Alternatively, when people are greedy (most often after a rapid increase in price) – this is a good time to sell. There are other factors that play into this index, such as volatility, momentum, and social media sentiment. Since Bitcoin is primarily a P2P traded instrument, knowing the tide of sentiment can go a long way. 

As we have seen in this consolidation period, the market remains slightly fearful. A value of “50” would be perfectly neutral, but as the historical values indicate – we have been in this territory for a long time. While “Extreme Fear” values (below 20) are a great indicator, this indicator is basically neutral and does little to help us predict Bitcoin’s next move. 

Fundamentals

After Bitcoin’s block halving, some experts predicted that Bitcoin would plunge into a “death spiral” since mining would cease to be profitable. In essence, if miners consume more electricity than their Bitcoin returns bring them, there is no sense in continuing operation. Bitcoin would be forced to increase miner profitability – either through increasing price or reducing the mining competition. 

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Dear Midas Community,

This is our weekly update on Bitcoin price movements. We as a team feel that these insights are valuable to the community, as the value fluctuations of Bitcoin greatly affect altcoin markets. In this series of TA articles, we will conduct both price and fundamental analysis to determine an overall trend for BTC. 

Price Analysis

Once again we will observe the movements on a large (4H) candle timeframe. We can see that over the past few weeks, Bitcoin has been consolidating between the 9-10k mark, with breaks out of this range quickly correcting. 

A new wedge is forming on the chart, with support being repeatedly tested in the $8800 zone. This is a major support zone, which has survived multiple tests. The lower highs suggest that this zone will continue consolidating until a direction is determined. 

On the shorter-term 30m candle chart, things are looking decently bullish with a nice bounce from the $8800 support zone. The moving averages are looking good as well, with the 100MA crossing the 200MA. This bullish move would be confirmed with high volume, which has not yet happened. 

Investor Sentiment

Investor sentiment is a key indicator for the market direction. As the renowned investor Warren Buffet once said, “Be fearful when others are greedy, be greedy when others are fearful.” The key here is to go against the sentiment. When times are fearful, it presents a good buying opportunity. Likewise, when investors are greedy, the market is likely due for a correction. 

The sentiment index has been in the low 40s for quite some time now, showing investors are tepid about price prospects. Nonetheless, the market has not had any significant moves in either direction, so the index has stalled out in this range. 

Fundamentals 

Miners revenue continues to hold near yearly lows. Bitcoin miners have certainly taken a large decrease in earnings following Bitcoin’s block halving. These yearly lows have not broken significantly below $7M, creating a nice support zone after testing several times. The only way that miners are going to increase their revenue is by refusing to sell at this valuation. 

Analysis

The $10k psychological resistance continues to evade Bitcoin, and the price is now consolidating yet again. After a failed attempt to break support last week, Bitcoin is in indecisive territory. On a short timeframe, technical indicators look neutral to bullish, but on the larger time frames, they look neutral to bearish. The best move now would be to wait for entries near the support zone, use tight stop losses, and exercise extra caution until Bitcoin determines a decisive direction. 

Always do your own research before making an investment decision. 

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