Uncertainty in the crypto market, is it a good time to buy Bitcoin?
Julien Moretto – 2 Oct 2019
Uncertainty remains strong in the cryptocurrency market this week, with Bitcoin once again down 3% over the last seven days, trading at around €7600 ($8,300) on October 2. Altcoins remain correlated and no assets currently stand out in the market. Among the large caps, only XRP is slightly more resilient and regains 4.20% over a week.
The market is therefore in doubt and pessimistic messages are once again flourishing on social networks. However, we believe that current price levels are buying opportunities that could be favourable in the medium to long term. On Bitcoin, the 7400€ (8000$) area seems to resist, and the support just below 6700€ (7500$) should also be strong. Is this a good time to buy Bitcoin? Here are some arguments.
According to CoinMarketCap, market capitalisation is bouncing very slightly to $220 billion from $217 billion last week. Bitcoin’s share of the total market capitalisation remains around 67.7%, which makes reading this market complex. Some information to note this week:
- Ethereum suffers less than Bitcoin and holds its support around 160€ (175$)
- Tether (USDT) becomes the 4th largest market capitalisation with more than $4 billion, ahead of Bitcoin Cash (BCH).
- The Hashrate (the hash power on the Bitcoin network) is back to its historical highs and seems to be a sign of miners’ confidence.
We invite you to discover our complete analysis in video (in french):
Buy on support
Our recommendation this week on Bitcoin should be considered in light of your risk aversion. Here are the price zones to intervene in according to your investor profile:
- First of all, for those who have a low-risk profile, better to wait. Since the break of the consolidation figure and the support of the €8200 to €8400 ($9100 to 9400$), the situation is not very positive. You would prefer to wait for the buyers to regain control. A bullish break above the €8400 ($9400) level with volumes will be a buy signal to take new positions in the market again.
- For those with a more aggressive profile, buyings were possible last week during the drop towards the price level between €7550 and €7800 ($8200 and $8500), corresponding to the daily gap on the CME Bitcoin Futures contract. However, this decline has led the chart below the 200-day moving average (the yellow line on the chart), which usually supports the price of Bitcoin during bull markets. Currently located around €7700 ($8400), a break above this moving average would give a first buy signal.
- If the price drops again and comes to the support between €6550 and €6800 ($7200 and $7500), some new buyings will be considered. However, it will be necessary to monitor the strenght of this support and the volumes.
- In any case, a clear bear break under €6550 ($7200) with volumes will be a sell signal. The bull market sentiment will then be questioned and a more detailed analysis abour the next potential supports will then be necessary.
Ethereum récupère un peu cette semaine et regagne 3,40% en sept jours, pour coter à 163€ (177$) ce 2 octobre. Même si la baisse du 24 était impressionnante, elle s’est encore arrêtée net sur la zone des 145€ à 160€ (160$ à 180$). Le cours n’est passé que très temporairement sous les 160$ et il n’y a pas eu de clôture journalière sous ce niveau. Cette zone reste donc pour nous propice pour des achats et de l’accumulation d’ethers dans une optique moyen long-terme. Il faut toujours franchir l’ancienne résistance des 212€ (236$) pour confirmer une reprise haussière plus long-terme, et une cassure baissière franche des 160$ avec des volumes resterait un signal de vente.
Ethereum recovers a little this week with +3.40% in seven days, trading at €163 ($177) on October 2. Even if the last week drop was impressive, the chart stays above the €145 to €160 zone ($160 to $180). The price dropped temporarily below $160 but there was no daily close below that level. So this price level remains interesting to buy to accumulate some ethers in a medium-to-long-term perspective. But we need to break up the resistance at €212 ($236) to confirm a longer-term bullish recovery. A bear break of $160 with volumes would remain a sell signal.
Looking back at the ATOM token, which offers this week a nice 10% bounce, trading at €2.30 ($2.50). The interesting technical pattern on ATOM is that the asset seems to have found a solid support around €1.80 ($2), through a double-bottom pattern, in early then late September.
This support interesting to buy. For those who already have some ATOMs, it is now holding time, because the price is located between this support and the resistance of €3.20 ($3.50). We also notice that the 100-day moving average was merged with this resistance during mid-September and rejected the price. A break above this moving average would be a first buy signal on ATOM. However, the confirmation of a longer-term bullish reversal will be the price to break the resistance at €3.20 ($3.50). Another signalto signal to strengthen purchases. Only a clear bear break below the €1.70 ($1.90) level will be a sell signal
Top & flops of the market (top 50 marketcap)
1- Ravencoin (RVN) : +17,77%
2- Chainlink (LINK): +10,39%
3- Cosmos (ATOM) : +9,84%
1- Ethereum Classic (ETC) : -4,45%
2- NEM (XEM) : -4,14%
3- Bitcoin SV (BSV) : -3,88%
L’essentiel de l’actu crypto
- The EOS ICO, which had raised up to $4B in 2017, is officially considered an “unregistered sale of securities” by the SEC. BLOCK.ONE, the structure that oversees EOS, will be penalized with a fine of “only” $24 million.
- Google has made a new breakthrough in the field of quantum computers. The firm operated a 53 qubits computer for several minutes. In the short and medium term, there is no threat to Bitcoin’s security.
- Some actors in the crypto ecosystem have formed a working group to give a rating as to the probability that an asset will be considered as a “security”. Bitcoin receives a “perfect” score of 1 and MKR and Polymath receive the highest scores of 4.5 out of 5.
- Fairwin, a popular Ponzi scheme in China that had been operating on the Ethereum network since the beginning of the summer, collapsed. $10 million was injected into this Ponzi scheme. It accounted for up to 30% of the network’s transactions. Its fall has considerably reduced the network’s transaction costs.
- Falls of more than 10% in less than 24 hours like last week’s are a consequence of the small size of the market. While crypto assets are gaining traction, these violent drops are becoming increasingly rare. The fundamental indicators, on the other hand, are at their All Time High.
- The Bakkt platform only achieved 71 bitcoins of volume on opening day. It manages to total an exchange amount of $5M over its first week. These disappointing figures indicate some wait-and-see attitude among accredited investors.
- The Central Bank of Venezuela is studying the possibility of acquiring Bitcoins and Ethers in its reserves. The country has been experiencing a severe hyperinflation crisis for several years. The government had explored the Blockchain ecosystem with the ICO “Petro” project, a major failure.
- 640 crypto projects did not publish a single line of code this year. This suggests that these projects are simply being abandoned. Nevertheless, many continue to be valued at significant market valuation.Strong market corrections are still expected with these assets.
Investors’ attention is drawn to the fact that the content of the articles does not constitute financial advice.
Investing in cryptoassets involves a risk of total capital loss.
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