Does Bitcoin Have an Ace up its Sleeve – or a Joker?

Talk to most investors who jumped aboard Bitcoin on the tail end of last years incredible rally, and they will look a bit distant – might even pretend not to hear you.

Bitcoin hasn’t really set the world alight over the past few months, and it has become a bit of an elephant in the savvy investor’s room. Yet is this justified? Is Bitcoin now done with us?

We don’t think so – most investments hit peaks and troughs far lower than the trajectory Bitcoin hit, and survive and prosper. The problem for Bitcoin is the expectation. Everyone with interest in crypto is willing it to climb back up to the heady days of $20,000 – on the basis of this expert, or that expert, saying it would go to $100,000 or higher – 6 months later they are disappointed that it hasn’t materialized.

One of the leading Bitcoin proponents, John McAfee, tweeted last week, that he predicted Bitcoin would breach $15,000 before June the 12th, then dip back in July. Those who are up with the current news will note that this was the date of the original summit that was going to take place between Donald Trump and Kim Jong-un of North Korea. We think a rally to this level highly unlikely.

Meanwhile, “Fakhan,” on the website Crypto Daily, is predicting a maximum $130,000 or a minimum of $32,00 by January, 2019, using technical analysis. We think this equally unlikely.

Sensible projections are needed now, as never before – and a lowering of anticipation to a more realistic outcome in the short-term is something we are talking to our clients about.

Bitcoin Daily Chart
Bitcoin Daily Chart

This is the daily chart for the year so far and you can see the drop down to 1) after the rally at 3). The drop again to 4) in February – and the recent slightly higher drop at 5).

We can attribute all kinds of reasons for these highs and lows, but Bitcoin has always been a volatile instrument. The overriding feature of the chart is the wedge formed by the highs and lows. Bitcoin seems to be moving within this range – and there is no sign of it breaking out any time soon.

The big question now, with the convergence of the EMAs (exponential moving averages), is whether Bitcoin will rally or fall further when it does break away.

In order to be certain of any rally, Bitcoin must hold the support between $6000 and $6500. If it falls, and closes, below this level, it may well go back to £5,943 or lower.

If it can hold this key level, and retests the lows of February and April, (shown at around 6) we may find it rallying back up towards the $11,000 level.

Long-term we think the outlook is still good for Bitcoin – and it may well surprise us with a snap move up (or down) – but for the moment we are stuck up that sleeve …

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin Confounds Us Again

Bitcoin is certainly becoming a wild card. “Normal,” rules do not seem to apply on many occasions – yet, on others, Bitcoin follows technical patterns in an almost textbook way.

Bitcoin 4H Chart
Bitcoin 4H Chart

This is the 4-hourly chart of Bitcoin for the last month. This means each of these candles represents a period of four hours before the next one. It shows a much clearer picture of what has occurred with Bitcoin through the latter part of April – and why we are confident Bitcoin has turned a corner.

If you follow our posts you will be familiar with us using the 21-day EMA (exponential moving average) the 55-day EMA, the 100-day EMA, and the 200-day SMA (simple moving average) as support and resistance levels. These are shown on our charts as the blue line, the green line, the orange line, and the purple line, respectively.

From a technical point of view, a downtrend is signified by the arrangement of the moving averages in relation to each other.

On the chart, the 200-day SMA is above the 100-day EMA. This is shown by the square A) on the left of the chart. Look at square A) on the right side of the chart, though, and you will see this situation is reversed – with the 100-day EMA above the 200-day EMA.

If you look at squares B), and C) – and compare their positions on the left side of the chart, with those on the right side of the chart – you will see this reversal repeat itself for each of the moving average lines. The right hand side is the arrangement we would expect in an uptrend.

You will notice, that after flattening off at the beginning of April, the price climbed sharply after the 21-day EMA crossed the 55-day EMA. This was triggered by the infamous 10% rise, by Bitcoin, on 12th April.

Following on, there is a large movement in price when the 21-day EMA crosses the 100-day EMA on 16th of April – and another when it crosses the 200-day EMA, just four days later on 20th April.

These moving average indicators are powerful tools – and they have the ability to predict “normal” movements in the market. This applies to any market – not just Bitcoin, of course.

The 21-day EMA Is particularly predictive. A glance at the chart will show the price moves above and below this average more often than any of the others. When the price is consistently above the 21-day EMA, and the 21-day EMA, in turn, is above the 55-day EMA, the price will normally be in an uptrend. This is useful to us because if the price rises considerably above the 21-day EMA, but falls back to it, it presents us with a buying opportunity before the price regains its upward trajectory again.

This is the theory anyway.

Backed by the 21-day EMA theory, we think that if Bitcoin can keep upward momentum – and stay closed above the previous recent highs of $9,420 of 30th April, then it will rally higher.

The next test for it will then be the $11,435-$12,770 zone. It must get through this to continue higher. If it rebounds from this retest and falls back to the previous low of $5,943 or below – it could be in serious trouble.

We are not expecting this outcome – but, as the old saying goes – expect the best outcome, but prepare for the worst …

Bitcoin Gets Its Mojo Back

As we have said, in previous articles, Bitcoin has been in a downtrend since December of last year – represented here, by the red trendline running between 1) and 2) on the chart above.

Bitcoin Daily Chart
Bitcoin Daily Chart

You can see from this, that on 6th March, Bitcoin hit the trendline, at 3) but was pushed back by the resistance of the supply and demand area, shown as the yellow line at $11,435. From there it fell back to retest the February lows, at 4) since when it has risen sharply. Firstly, in the explosive 10% move, on 12th of April – and since – as a steady climb up to 5) through the resistance points of the 21-day EMA ( exponential moving average) and the supply and demand level, shown as the yellow line, 5) at $8,407.

This is the first time, this year, that Bitcoin, has not only breached the trendline, but pushed through it, with increasing momentum.

The divergence indicator, at 6) coupled with the change in pulse direction – shown by the dark maroon lines, on the bottom chart – gave warning that something was about to happen.The divergence indicator then started to rise, and has kept rising to 7). This has been coupled with a steady, and pronounced rise in the pulse signal shown in green, at 8). These are all very positive indications that Bitcoin is on its way again.

We have shown on the chart, the various levels of supply and demand, which, we think, will be areas to watch, as Bitcoin regains momentum, and climbs upward again. The crypto has seen a lot of volatility, in its short life, and these levels indicate the probable turning points between the highs and lows for the coming months. These are not exact. They are merely a “heads up,” to show the regions of the chart to pay attention to.

We think that the next area to watch is that around the $11,435 line, again, shown in yellow. A quick look across the chart from 3) to the left, will show that resistance has been prominent at this level, on about a dozen previous occasions. This means that if the momentum is weak, the price is likely to bounce back from this level next time too – if the momentum is stronger it may well push through to the next point of resistance at around the $12,770 mark, again, shown as a yellow line.

Our belief that Bitcoin is a long-term gain, can only be helped now that the small investors’ favorite cryptocurrency is moving in a positive direction again. Whether this will encourage further buying by such investors remains to be seen – but for the moment, Bitcoin looks as though it may be in for a renaissance of sorts. Just watch for those levels…

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Is Bitcoin Washed Up – or Is the Tide About to Turn?

Sadly, it wasn’t to be. Since the beginning of the year, an incredible $550 billion has been lost in the cryptocurrency markets. Those who bought near the top are nursing losses of around 70%, on average.

It is little wonder those investors who are not so seasoned in the reading of the markets, and the “cycle of investment,” are running scared – or just standing on the sidelines, with their mouths open, watching the avalanche roll down the hill.

It’s a prescient time to remind ourselves where we are now – and put these losses in perspective.

btc

This graph shows a typical cycle of investor sentiment. We show this graph to our clients all the time. If you apply it to the excitement and optimism of last Autumn, as Bitcoin started to become popular, you can almost see it follow the pattern of the Bitcoin price chart. As the thrill and euphoria of being on board turned to worry and concern, those investors who had not taken into account the fact that they could lose money, as well as make it, had a major problem – they had no plan B – or C.

This was fine for those who could afford to lose the money – but stories abound, of folk who remortgaged homes, and sold solid assets, to get a piece of the action – without thinking through the consequences of any loss-making situation.

Our feeling is, that we have reached the “despondency and depression” point on the graph (see the golden circle). Those investors who have lost large amounts of money have given up on Bitcoin completely – many simply setting the loss aside, and writing it off as a bad experience.

But – look at the next part of the chart – once the price picks up, hope turns to relief, which turns to optimism – and the whole cycle starts again.

With this in mind – a look at the daily chart, for this year, brings a new perspective into play:

Bitcoin Daily Chart
Bitcoin Daily Chart

Although Bitcoin is only one of over a thousand cryptocurrencies, it is, undoubtedly, the one which has the most impact – for good or bad – across the board.

The relentless fall since December of last year (which can be viewed as the point of maximum financial risk, on the cycle of investor sentiment chart above), at 1) broken, only, by the rally during February, at 2) continuing through,m 3) – which is where we find ourselves today – has been the precursor to multiple falls across the cryptocurrency complex.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin Seeks Friends for Long-term Relationship – GSOH and Patience Essential

It’s difficult not to have some sympathy for Bitcoin at the moment. Like the star jock of the football team, who makes a mistake, and finds himself to be “excess baggage” – the guy nobody wants to be around anymore – the main cryptocurrency is a dirty word in investment circles right now. “Oh yeh, Bitcoin – remember that? How much did you lose then?”

Being yesterday’s big thing is difficult. How do you shake off the innuendo, and separate the good from the bad now …

The run of bad karma for Bitcoin – since the highs of December, at 2) in the chart below, has been painful and devastating to many first time investors. Interestingly, anecdotal evidence suggests the majority of investors,  especially those holding small positions, are simply parking their money, and hoping for an improvement in Bitcoin’s future returns. They are not withdrawing their money en masse. This seems to go some way to explaining why Bitcoin is not lower than it is, and, for now, seems to have found a level.

The people cashing in, are ICOs (Initial Coin Offerings) and developers. They need to cash in for marketing, and to fund further tweaks to their crypto operations. Some, of course, are just panicking and simply closing their setups. Others are fearful of recent moves by the IRS (U.S. Internal Revenue Service) and the SEC (U.S. Securities and Exchange Commission) to introduce some form of regulatory, and tax structure, into the crypto equation – and are making their exit before these moves are brought into play.

The whole cryptocurrency “complex” (as the total of all cryptos on the market is known) has lost a staggering $555 billion in the eleven weeks, since the start of the year, in which it has been falling. This is 67% down. Ripple, alone, is down 85%!

This cloud may have a silver lining though. It is well-known that miners use vast amounts of electricity to acquire the codes necessary to break the crypto cyphers – and unlock the currencies. This electricity is expensive – depending on where in the world the miner is based. The estimate of breakeven for a Bitcoin mining operation is $8,038. It stands to reason, a miner who has to pay more for power, than they are making, is running at a loss.

Basic economics says that if supply is reduced, it introduces scarcity, and the price should rise.

Those miners in locations where electricity costs are cheaper, can safely, and profitably, mine down into the $4,000 – $3,000 level. There is evidence to suggest (heard at a major crypto conference in Mexico, recently) some mining operations are trying to set up, together with certain governments, their own dams, and hydro-electric schemes. Nobody would be contemplating such moves unless they saw a very bright future for cryptos as a whole.

There are still other issues looming. The ban on advertising for crypto firms on Facebook and Google will hit hard. Small investors have been the lifeblood of cryptocurrencies – and if they cannot be sold to, it leaves a huge gap in the income streams of both, existing operations, and ICOs.

The IRS is now circling too. The American tax collectors smell blood – they are looking at ways of collecting revenue from investors who made small fortunes in the run-up to Decembers highs – this is regardless of whether they are now nursing huge losses. The only way of avoiding this is by sheltering cryptos within an IRA arrangement – unfortunately, there are very few companies who are able to facilitate this at present.

So let’s take a quick look at the daily chart and see if there is anything emerging.

Bitcoin Daily Chart
Bitcoin Daily Chart

The long climb up from last September, at 1) is now long forgotten – but it is worth noting the level Bitcoin was then – around the $4,000 level – and the low of February, at 4) when it hit $5,871. These are now both key levels to watch in any further downtrend.

We can see, at 3) the trend is downwards – and despite a brief rally, at 4) followed by some volatility – it has retrenched, and is now falling again, at 5). In the last couple of days, there has been a small push upwards, at 6) but the 21-day EMA (Exponential Moving Average – blue line) has yet to be challenged as resistance.

We still think this downtrend has yet to play out – either at the level of the previous low, at 4) where it was $5,871 – or, as a worse case scenario – way down to the $4000 level, which is the bare minimum, sustainable by most miners.

Should it hit these levels, we think Bitcoin may well make a recovery. We think the “nuclear” option of it going to zero is overblown and sensationalized. Often these recoveries are swift and strong – and may well introduce to Bitcoin, the kind of long-term friends it is looking for.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Is Bitcoin Skiing Downhill?

The Winter Olympics are over for another four years. Athletes in svelte ski suits (or Marvel outfits – in the case of the American team) thrilled everybody, with some fairly breathtaking maneuvers down the snow-covered slopes of PyeongChang, in South Korea. The times in the giant slalom event were crazily fast. Zipping between the flags and defying gravity, to swing one way or the other, whilst hurtling down a hill takes nerves of steel. And practice. And planning.

However much you twist and turn, your ultimate direction – in any form of skiing – is down. Even the youngsters, on the half-pipes, with their snowboards followed the huge jumps with huge falls, eventually running out of steam at the end of their run – gravity is an inevitability in the Winter Olympics it seems.

Technology can help to overcome some of the forces at work – carbon fiber skis cut through snow and ice far better than wooden skis – and the sleek, designer overalls – cut down wind resistance and help gain the hundredths of a second which can mean the difference between a gold and a silver.

In the same way – we can use the technology of electronic indicators, and clever projections, to help us try to minimize losses, and increase gains – but we cannot deny or overcome trends. If the market is moving up – it is moving up – if it is moving down – well, you see what we mean …

Bitcoin Daily Chart
Bitcoin Daily Chart

This is where we find ourselves right now. The trend is obvious. We see two ways this can play out …

The first is a retest of the lows of February. The chart is forming, what may become, a classic “double bottom” pattern. This is a powerful reversal signal – by this, we mean a reversal of the trend. The trend is down, or negative.

Bitcoin Daily Chart
Bitcoin Daily Chart

Here we can see the trend clearly since Christmas – except for the bounce in February, and the slight retrace last week – this trend is obviously down.

At 1) and 2) the price formed a “double top” – and looks to be shaping an “M” pattern with a “double bottom,” at 3) – and possibly 4).

We need to be aware that the price may well bounce higher from the second low of around $6,000 – and, because of the power of the signal, the rise – if this happens – will be rapid …

The second scenario is a rise through the current resistance level – and psychological barrier at $10,000.

Bitcoin Daily Chart
Bitcoin Daily Chart

Once through this barrier, at 2) the price may rise from the low, at 1) back up again, to 3) once buyers get onboard again.

It has been a scary ride for the new and amateur investors, who make up the bulk of Bitcoin buyers – there are very few institutional holders. This has advantages and disadvantages.

On the one hand, there are no “high-frequency traders” here – on the other – many Bitcoiners are first-time investors, with no experience of falling markets, risk strategies, and stop losses. This means many – having bought at around the $20,000 mark – have lost considerable sums of money. This will make them extremely reluctant to get back in the ring.

If Bitcoin does follow the first scenario (and this is looking more likely by the day) there will be a lot of panic selling and anguish – the exact time the professional investors will step in to mop up the bargains.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Will Switzerland Save Cryptocurrencies?

Its location, nestled between Germany, France, Austria, and Italy; coupled with its rugged, mountainous terrain, have, for millennia, made it a perfect place to hide. Many of the world’s richest citizens count themselves amongst the 8 million inhabitants of Switzerland. Indeed, the country is the wealthiest in the world in per capita terms and has the 19th largest economy. Switzerland has no natural resources.

A large share of its income is from manufacturing. Pharmaceuticals account for around 6% of GDP – around 30% of exports – and many watches, and fine engineering companies, are based in the country. By far the biggest earner, though, is “banking,” and “wealth management.” This accounts for most of Switzerland’s historic and current affluence.

The main Swiss banks command a huge global presence – as well as UBS, Credit Suisse, Julius Baer, Pictet, and Lombard Odier – who are Swiss Banks, there are around 16 banks incorporated in the country, and about a dozen, family-owned banks based there. In addition, there are scores of international banks who have branches in Switzerland.

Back in 1934 the government, at the time, saw a way of capitalizing on the political situation in Europe and enacted secrecy laws for such banks, this allowed the identities of account holders to be withheld, enabling people to deposit unlimited wealth in Swiss vaults, knowing they were both safe, and private. This has served Switzerland well ever since. Until recently.

The Patriot Act in the US, and actions by European countries, seeking to stifle the money laundering of terrorists, and organized crime groups, has led to a steady erosion of privacy and confidentiality. There is now a US Terrorist Finance Tracking Program which uses sophisticated methods of obtaining information. For this reason, it is often better for the Swiss banks to quietly hand over the details of their account holders than it is for them to have their records hacked, and their encryption methods discovered. Combine this with the acceleration of whistleblowing (Bradly Birkenfeld), and breaches like WikiLeaks and the Panama Papers, and suddenly keeping your assets quiet doesn’t seem to be so easy.

Switzerland, though, has been looking to find other avenues to keep the account details of its clients confidential – and away from prying eyes and the tax authorities. These are not just rich individuals it is trying to protect, but organizations, banks, international companies, and trusts – countries, too, and the leaders of some of those countries.

It now seems the very technology which was about to cause the demise of the Swiss finance sector has now rescued Switzerland. Secure computer systems, using public-key cryptography (a type of financial cryptography) and anonymous financial instruments such as electronic money, and digital bearer certificates have now become so advanced that they can now provide the beefed-up security modern tax evasion, money laundering, and under-the-table finance, need.

If this sounds familiar – it ought to. It is a description of the blockchain – transparent transactions – with privacy as a side order. Smart contracts via Ethereum and derivatives of this technology are being rolled out in different forms every day.


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This other niche is growing in a valley city called Zug. This has become a center for raising funds for ICOs. The Swiss Financial Market Supervisory Authority (FINMA) has introduced regulatory guidelines for crypto, Blockchain, and distributed ledger technologies. Of course, the key to this new role is the fact that Switzerland has an estimated $2 trillion – 27% of the global offshore wealth – all looking for investment potential. The kind of returns cryptocurrencies are capable of delivering is far too tempting even for the Gnomes of Zurich (or Zug) to ignore. ICOs will be treated security in Switzerland – and on February 16th, FINMA published its guidelines, which set the ground rules by which cryptos will be handled by the authorities.

The implications of this are enormous. The credibility factor of Switzerland’s financial authority, officially recognizing Bitcoin, cryptocurrencies, ICOs, and the blockchain, as de facto financial instruments – and making them more tradeable, as well as giving them a base – in the most rarefied monetary environment in the world, is likely to be a major step towards them regaining their recent lost ground with investors.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

The Real Problems Being Solved Behind Cryptocurrencies

By way of a change this week, we are going to look at the technical analysis and charts we usually show, to see what lies behind cryptocurrencies, and explain why we think that not only are they here to stay, but why they will become an essential part of all our futures – along with artificial intelligence, data analysis, self-driving vehicles, and the internet of things.

Nobody knew, when Bill Gates put MS-DOS (Microsoft Desk Operating System) together, that it would become the giant worldwide game-changer that it has – Ditto, Steve Jobs with Apple’s equivalent.

This is where we are with cryptos right now. Sadly, most “investors” are looking short term, at just the money, the profit, and the short-term gains – but this is – we believe – just the beginning.

The “blockchain” (the MS-DOS behind the headlines) will be a game changer, in whatever form it ultimately takes – and whatever vehicle it uses to do it’s thing.

Let’s use a real example …

We all eat. The majority of us eat meat. Now, because industrialized farming is the only way to produce enough meat products to meet demand, a massive network of producers, slaughtering facilities, packing and distribution systems, and storage depots, have grown to cater to the meat industry. Because of its size, accountability – and more importantly, traceability – of meat has become an important issue when batches of meat are found to be contaminated, or unfit for human consumption, for some reason.

When this happens, the supply chain needs to be shut down quickly, and the source of the problem, traced so that remedial measures can be taken. This is a major problem. Each year bad food (not just meat) means one in ten people being ill, 700 million people in the hospital for treatment, and 400,000 deaths – mostly in children under age 5. The cost, to the US economy, alone, of illness because of food problems, is £55.5 billion.

There are many reasons for the problems with our food. One is the misuse of antibiotics in farming – used to promote growth, as well as preventing infection, routine use of antibiotics has led to the advent of antibiotic-resistant “superbugs” which cause serious issues.

Britain has seen several scandals in the past few weeks with food suppliers  – serious safety issues in some of its largest meat processing plants – those which produce and pack for supermarket chains and restaurant and catering groups. Despite squads of food safety inspectors, tasked with policing worldwide food sources – there are simply too many loopholes for the current systems to cope with.

TE-FOOD, (TFOOD), Ambrosus (AMB), Modum (MOD),Provenance, WaBi (WABI) and Walton (WTC) are all developing and using (in TE_FOODs case) a combination of Ethereum blockchain technology, for public transparency, and a private blockchain, for administration purposes. These systems will aid food safety, prevent antimicrobial resistance, and the misuse of antibiotics, reduce economic inequality, migration caused by climate change, frauds and scams within the food supply chains, leveling of the “subsidy” playing fields.

With recent scares of horse meat masquerading as beef, it is not just the food industry that is susceptible – the world is awash with counterfeit goods. If this is a Gucci handbag, then it is just a trademark and copyright issue. Increasingly though, scares have involved a much wider range of goods – brake pads, and tires, for cars; aircraft parts, drugs and medicines, shampoos and cosmetics, toys, baby milk, electronic devices, and other goods which rely on a set of regulations and standards to ensure public safety.

The blockchain technology to introduce transparency, at each and every stage in these products and services journey to the consumer, has only just been drafted. Cutting edge technology takes time, money and determination – not to mention some of the smartest people in the world. We are at the MS-DOS stage.

If you are looking for a long-term investment strategy – get involved with crypto – find out all about it (not just Bitcoin) – buy some – and cling on for dear life!

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Relentless Negativity is Driving Bitcoin – For the Moment …

This week, the bad news was aggravated by Facebook announcing the pulling of all crypto marketing as a “protective measure” to stop rogue companies involved in scamming via the platform. This has hit the genuine companies badly – and has further decimated the increasingly frail perception of Bitcoin as a viable financial instrument.

The result of this has been the biggest slide in price yet.

Our own worst-case scenario has been pushed lower by the volatility – and we now have to re-examine what could happen next.

Bitcoin Daily
Bitcoin Daily

Bitcoin falling to “new” lows is nothing new – to give this all some context – take a look at this snapshot of the daily chart, from August 2015 as a comparison to the current situation. At this point in its story – Bitcoin had reached $300 – and had fallen back to $200.

Here, at 1) you can see that Bitcoin fell below our usual 21-day, 55-day, and 100-day EMA support levels. It reached it’s low, of $200, on 25th August, at 2) before gently recovering until breaching the previous support levels (now resistance) at 3) to recover strongly again, at 4).

These EMAs were backed up by the ADX signals in the second panel, at 5). This shows the recovery of the 14-day ADX ( grey line) and the change in negative sentiment, under 2) where the negative 14-day DI (red line) is strongly above the positive 14-day DI (green line). This changes, at 5) when the positive 14-day DI moves strongly back above the negative 14-day DI.

The negative pulse signals, at 6) also become positive – with the price rise – and continue to rise, at 7).

Lastly, the red dot, divergence signal, at 8) indicates a strong change in trend – which is followed through, at 9).

What does this previous experience tell us about the current situation we find ourselves in? Simply, that markets go up and down. We have long spoken of the volatility involved in Bitcoin, and it’s sensitivity to the news – both good and bad. Cryptocurrency is very much an embryonic concept, which has only recently captured the public interest beyond the pioneers, and “crypto-geeks,” who invented it. Most people who invested in them since November have been driven by the percentage returns, rather than the technological knowledge that lies behind digital currencies like Bitcoin. These are longer-term considerations.

They are not the kind of arguments that people holding large losses want to grapple with. The uncertain – and worried newer investors – are running scared … driving the price lower.

BTC/USD Daily Chart
BTC/USD Daily Chart

Turning to the weekly chart, the heady days of a $20,000 Bitcoin seem very remote.

The fall has been as dramatic as the rise. Bitcoin has hit the 21-day EMA support level now – and is pushing lower, at 2). If it closes below the 21-day EMA, the next line of defense is the 55-day EMA, at 3). This would take Bitcoin to a new low of around $6,000. Of course, the 100-day EMA, at 4) the final strong support level, would see Bitcoin at around $4,000. This is low – but it is far from zero. Any of these levels may represent a new buying opportunity for those who are willing to see further than the immediate gains and losses caused by the flightiness of “investors.”

That Bitcoin has further to fall, is confirmed by the ADX indicator, at 5) with the dip in the 14-day ADX (grey line) being graphically clear, along with the rise of the negative 14-day DI (red line) at 6) which is just rising above the positive 14-day DI (green line) sharply.

The pulse indicator tells it’s own story, the strongly positive, light green pulses being replaced by strongly negative dark green ones, at 7).

Finally, the blue dot, at the top of the divergence indicator, at 8) signals a strong change in sentiment – from positive to negative – and this is borne out by the fall since at 9).

As usual, we need to keep a very close eye on all the signals and indicators, which will give us a timely warning as to what the next moves in Bitcoin might be. Be aware of the support and resistance levels we have pointed out – and be prepared to regroup around them if sentiment changes. We remain positive about Bitcoin into the future.

Right now – the bulls are at war with the bears here – what transpires depends when they decide to fight back … and how hard …

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

The Bitcoin Conundrum – What Should You Do?

The Winter Olympic games are coming up in Korea in a couple of weeks. Nothing separates the “amateurs” from the “professionals” like the Olympics. The gaps in times and distances, between the first and last placed competitors, is obvious for all to see on the scoreboards.

The same is true of investment – particularly when it comes to cryptocurrencies – and Bitcoin in particular. The differences between the winners and the losers are mostly down to knowledge and planning.

Bitcoin has appealed to amateur investors because of the staggering gains made recently. For some, who got in early, these gains are in the thousands of percent. But, for most of these amateurs, the playing field has now become seriously dangerous – if most of the financial press are to be believed – “financial Armageddon” has arrived.

More seasoned investors – especially those used to dealing with technical analysis – will be a little more relaxed about what is happening at the moment. Like the professional Olympians – if you have prepared properly, and trained – you should be fine …

Bitcoin Chart
Bitcoin Chart

The chart above shows the weekly progress of Bitcoin since July of last year.

Before we look at it in greater detail, we need to explain that the indicators at 1), 2), and 3) are “exponential moving averages.” These are well-known, and common, indicators in technical analysis – and are a powerful tool in determining both support and resistance levels. They are readily available on most charting software and are easy to follow. We use them all the time.

Moving averages can be charted for any period of time – from days, through weeks, and even months – the averages that we find most useful are the 21-day, 55-day, and 100-day exponential moving averages (EMA for short). In addition, we sometimes use the 8-day, and 200-day EMAs, for a more short term, and longer term, analysis.

Going back to the weekly chart – it can be seen that using the 21-day EMA (blue line) as our indicator, at 4) the price has been trying to break this level for several weeks but has hit resistance. The sellers are in control of Bitcoin, and it is quite possible Bitcoin will close below the $10,000 level, at 5) and may even breach the 55-day EMA, and fall to the level of the 100-day EMA, at 3) and 6).

This 100-day EMA is a strong level of support – the major investors of Bitcoin will fight tooth and nail to preserve this – which is why this is our “worst case scenario” for Bitcoin. Any retrace to this level would be a huge buying opportunity.

There is a previous example of how the EMA levels act as support, at 7) on the chart. Here, in September, Bitcoin fell and tested the 21-day EMA – but failed to close below it – before recovering in October.

In the third window of our chart, at 8) it can be seen that our momentum indicator spiked at this point after a steady climb. What would normally happen here is a correction into negative territory, at 9) before the indicator recovers and the trend reverses back into positive territory, at 10).

At the same time the directional indicator in the fourth window, at 11) shows a mirror reaction which will probably follow a similar fall and recovery.

Going back to the Winter Olympics – it may be time to start looking at Bitcoin in the same way the professionals do – finding the “worse case scenario” and planning around it. Reading the cryptocurrency news objectively, and interpreting what can be seen – as fact, on a chart – is more likely to make you money, than blind panic, knee-jerk reactions to situations which can be (to an extent) predicted, and acted on, in advance of them happening. We are still very positive about Bitcoin – but remember the volatility – and be defensive in your approach.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

What does early 2018 have in store for Bitcoin?

2017 saw itself out with the promise of a $20,000 Bitcoin, but then snatched it away, along with lots of new “investors” hoping for an early Christmas present.

It wasn’t to be – so – what does 2018 have in store for this crypto?

BTC/USD Daily Chart
BTC/USD Daily Chart

Firstly, we think that cryptocurrencies are now going to get serious. The newer investors who dipped their toe into the water, only to find themselves drowning, will be very unlikely to return. If Bitcoin, Ethereum, Ripple, Litecoin, and others, can prove themselves during 2018, even newer investors may be enticed into the market to try their luck. But will that happen?

Banks and other “classic” financial institutions are now accepting fintech, cryptocurrencies, and ICOs, much more earnestly. Governments, too, are beginning to realise that Ethereum, for example, is a real, and powerful tool, capable of far more than simply acting as coinage. The concept of ledgers, smart contracts, and blockchain transactions is now on many more agendas.

Bitcoin has come a long way, even since October, when investors were getting excited because it had reached $5,000, at 1) on the daily timeframe chart above. It continued rising through, to 2)  where it experienced a setback, which, at the time, had everyone calling time on Bitcoin.

In retrospect, this was a blip – but it showed, once again – the power of the 21-day EMA (exponential moving average) and the 55-day, and 100-day levels as strong support, just as they proved back in mid-September, mid-July, the end of March, and the beginning of January. What this shows, beyond doubt, is that Bitcoin has never closed below the 100-day EMA. This gives us a benchmark to go by.

After the hype and wishful thinking of us all wanting Bitcoin to reach $20,000 by Christmas, at 3) it came as a shock, for some, to find Bitcoin falling to $14,115 on 22nd December. But, again, the 55-day EMA held, at 7) and saw it climb back.

It is currently bouncing around the 21-day EMA. We see two scenarios here, at 4). The first is Bitcoin rising, at 5) to pass the previous resistance level around $16,409. If it does this – and goes higher than $17,000 – it will signal that the buyers are back in control, and Bitcoin should climb even higher again.

If it does the opposite, at 6) and falls below the previous, lowest high, at around $12,872 – it will show that there is more selling than buying – and the price is likely to drop back to the 55-day, 7) or possibly the 100-day EMA, 8).

The remaining indicators on the daily chart are fairly inconclusive at the moment.

The 14-day ADX and DMI indicators, at 9) are flat – with a slight negative edge as the -DMI (red) is above the +DMI (green).

At 10)  although the last two indicator dots are red – the first in months not to be blue – the pulse wave is showing a slight upward trend, despite the fact that the color has gone from red to maroon, which would indicate a negative momentum.

Lastly, since showing the start of the recent downtrend, at 11) the divergence indicator has fallen, and we await a red dot signal, which would indicate a potential rise taking place. We would expect this to happen at 12) and probably, quite soon.

As a backdrop to all of this, there is a strong rumor that Amazon is about to accept Bitcoin as a method of payment. Patrick Byrne, the CEO of Overstock, has stated that Amazon will soon have no choice but to start accepting it. He is quoted as saying, “… they have to follow suit. I’ll be stunned if they don’t because they can’t just cede that part of the market to us if we are the only main large retail site taking Bitcoin.” Scott Mullins, an Amazon executive has confirmed that Amazon is, “working with financial institutions and crypto-experts to spur innovation, and facilitate frictionless experimentation.”

If the Amazon rumor turns out to be true – Bitcoin will probably go into orbit! Be prepared…

Will Bitcoin pass its first BIG test?

Blind panic has hit the Bitcoin story. The cryptocurrency is certainly taking a tumble. But, as we have intimated in recent weeks, a correction was long overdue, and a shakedown could be just what is needed to get 2018 off to a great start.

If that sounds counterintuitive, it might be an idea to recap over just what has happened with Bitcoin over the past couple of months. The historical investors in Bitcoin – those who were familiar with the technology, the ethos, the whole concept – have been quietly investing for years. Recently, they have been joined by investors who know very little (if anything) about what underpins the technology. They have read the headlines about the astonishing gains this crypto has made, and have dived in – at the top of the market – expecting the price to zoom up no matter what …

In general, these new investors do not understand how volatile, and different, Bitcoin is, as a financial instrument. To be fair, even the “experts” have a hard enough time with the intricacies sometimes.

It is the new investors who have created the froth in the price, which is now being blown away. Longer-term investors – not those who just thought they’d buy a few hundred dollars worth, “and see what happens …” – will be fine.

For many – this is an incredible buying opportunity, and a chance to get into the market at a great price.

Bitcoin Daily Chart
Bitcoin Daily Chart

Let us explain our reasoning, by taking a look at the daily chart.

At 1) Bitcoin looked like it was going to hit the $20,000 level last week. For many reasons, not just the hacking and subsequent failure of a Korean exchange, the crypto started to fall. A panic set in amongst the smaller investors who fled with their losses. This spooked some of those who had been watching the market closely, for signs of a fall. This then became a self-fulfilling prophecy – and investors sold over the next few days, to send the price back down to the 21-day EMA, at 2).

So far this has held, as it did, at 4) back in mid-November too – although the force behind the fall was weaker here than it is with the latest drop.

2) is the first of the key major support levels to be tested in this latest tumble – the others being the 55-day SMA, at 4) and the 100-day EMA, at 5). We see no reason to panic – as long as the price does not close below the 21-day EMA. If it does, we would be looking at the 55-day SMA as the next support. Indeed, the institutional investors and other “serious” players will want to hold on to this level, at least – and would do all they could to make sure that it holds. They have way too much to lose.

The 14-day ADX, at 6) has made its mark by showing that this correction was going to happen – and it did this perfectly – giving a timely indication of what was about to happen. In addition, the positive DMI, at 7) is falling, whilst the negative DMI, at 8) is rising – so the bears are in control at the moment. These indicators should be watched closely over the next few days for early signs of any reversal of the downward trend.

The volume and momentum, shown as the pulse signal, which has fed the recent rise, since 9) has now flattened and is falling rapidly, as shown by the color change, at 10) and the sharp fall, to 11) which has resulted.

Bear in mind, Bitcoin is incredibly volatile as an instrument anyway – add in panic, and novice investors and that volatility is multiplied many times. Cryptocurrencies are largely untested in the situation we find ourselves – but sticking to the textbook guidelines – reading the charts objectively, and thinking through the options, should keep you safe.

Use due diligence before you commit to any trades in this market – and keep your wits about you.

Have a wonderful Christmas and a very happy, healthy, and prosperous New Year.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin Defies Gravity, Again

Today marks one of the most auspicious days yet for Bitcoin. The long-awaited launch of Bitcoin futures on the Chicago Board of Exchange. Millions of pages of free publicity, tons of press commentary, and plenty of resultant interest. FOMO, or “fear of missing out” will drive the market higher, as investors new to cryptocurrencies, race to get onboard before the train leaves the station.

At around $17,000, Bitcoin has surged over 1,500% since the start of 2017. That means that the combined value of every bitcoin currently in existence is around $274bn or more than most major companies (it overtook JP Morgan – ironically, its biggest detractor – last week, for example). The attraction of these kinds of gains is not hard to see.

The chart here is from yesterday, Sunday, deliberately so to give an idea of what to expect on the downside, without the influence of today’s launch.

Bitcoin Daily Chart
Bitcoin Daily Chart

At 1), Bitcoin reached the end of its momentum and fell back on profit-taking – and having reached one of those “thousand” levels we have spoken of – in this case, $17,000. Even within the falls, you can see the fluctuations in price were measured in thousands. Volatility is ever present with this crypto – and this is something to bear in mind at all times.

With the 21-day EMA (blue line) at 2,) as the first level of support and the 55-day SMA (green line) as the “backup” level, the level of fall would be limited to around £11,500-$8,000. If it did fall to the $8,000 mark, it has a further support level at the 100-day SMA (orange line) at 3). So there is quite a safety net in place.

There was a previous example of these supports working back in mid-November. Here, at 4) you can see Bitcoin hit $6,500, but bounced right off of it, to rally again, even higher. Once it had cleared the 21-day EMA it went on to consolidate at one of the “thousand” levels – in this case, $8,000 before rallying once again.

We think that Bitcoin will gain from the interest in the futures launch, and this could see a surge to the $20,000 dollar level. At this point, it may well retrace again – back to the 21-day EMA or 55-day SMA.These are the key levels to watch in the coming days. We would use them as buying opportunities – as we see the upside for Bitcoin looking better and better for the moment.

The “crash” which has been predicted since Bitcoin hit $3,000 still seems to be some way off. Drops of 10-15% are becoming the norm with this crypto and need to be factored into your trading plan.

Bitcoin futures are currently trading at $17,900, up 15% while bitcoin is trading at $16,340, up 9.80%

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

What Does the Future Have “In Store” for Bitcoin?

This may well have been true, even a short time ago, but a quick search on the net reveals things are changing rapidly. This is a map of London showing bitcoin ATMs.To quote the site, “Bitcoin ATMs are arguably one of the easiest ways to buy bitcoin and more and more are appearing in cities across the UK. These machines allow you to buy bitcoins at a fair price using cash (and sometimes debit/credit cards) and receive them instantly into your wallet. Some bitcoin ATMs also let you sell bitcoin and pay out cash.

Bitcoin ATM's in London
Bitcoin ATM’s in London

Another site shows the locations of 1,891 Bitcoin ATMs worldwide – as well as over 40,000 other cryptocurrency services which are now available.

This would have been unthinkable just a year ago.

In the UK, even the central bank, The Bank of England, is looking seriously at bitcoin. This PDF is a summary of their current involvement in cryptocurrencies. They have been investigating the issue for at least 12 months.

In addition, it was announced this morning that Britain and the EU are joining forces to crack down on the tax implications and money-laundering aspects of cryptocurrencies.

Taken at face value, an intra-governmental initiative to prevent the widespread use of cryptos could be seen to be a bad thing for investors in Bitcoin, Ethereum, Litecoin and all the others. What this news has actually done though, is legitimise further, the use of these methods of payment. For governments to intervene, they must perceive a real threat to the status quo provided by the banks and old-guard financial institutions.

The likes of Goldman Sachs and JP Morgan have been scathing in their dismissal of cryptocurrencies as frauds recently, and regard them as a bubble, which they are assuming, will burst very soon. Obviously, governments think differently.

One of the arguments these governments are using is the alleged anonymity of users. They fail to acknowledge that the blockchain is based on complete transparency. Transactions can be followed back to their original source. In order to open an account for any e-wallet, some form of ID is invariably asked for – usually in the form of a passport or drivers license. Any form of cash, as an existing fiat currency, has the same issues.

With national debts at record levels, stagnating economies with reduced tax income being made, and a seemingly, inexhaustible need for money to sustain their administrations, governments across the world are looking for ways to increase their tax take, and cryptocurrencies are a prime target, given their growth, capabilities, and future prospects. Rather than outlaw them, and kill the project dead, they see this rise in popularity as a way of finding another stream of income.

With an ever-increasing number of people losing faith in their politicians, and the way in which those same governments are mismanaging major financial issues, like their pensions and their social security, it is little wonder the public are turning to cryptos as new methods of finance, which they perceive as a better way of looking after their interests.

Bitcoin has been the cheerleader for such cryptocurrencies. It has firmly established itself in the minds of the public (especially investors) as a serious alternative to existing paper currencies; along with their limitations of exchange rates, physical storage, the risk of theft, and other drawbacks. As more ATMs are made available, and retail outlets decide to accept cryptos as a payment method, so people will become more comfortable dealing with them, and using them.

Such cryptocurrencies are in their infancy, but they are becoming an increasingly accepted means of payment and this alone makes them worth keeping an eye on.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

$10,000 – Is Bitcoin Easy Money?

Well, Bitcoin’s weekly graph says it all. The stratospheric rise of Bitcoin to within a whisker of the $10,000 level, muted as a dream and even a fantasy by many people back at the beginning of January and during the current year. That fantasy has now become the reality.

Bitcoin Weekly Chart
Bitcoin Weekly Chart

The velocity which Bitcoin has raced up the charts has left even seasoned market observers reeling. Since it stalled in the spring, before starting its climb in July, the cryptocurrency has been virtually unstoppable.

The gap between the 21-day EMA (blue line) and the closing prices has widened – as well as the gap between the 55-day SMA (green line). Both of these indicators provide very strong resistance levels for any retracement, which is bound to occur once the $10,000 target will be achieved. Profit-taking, and worry that the momentum will have gone out of Bitcoin at this stage, will be the main reasons for this subsequent fall.

As usual, any retracements to these two support levels should be seen as buying opportunities.

The 21-day EMA, in particular, is around the psychological $5000 level. Many experts believe that this is the amount investors and miners will fight to maintain the minimum value of Bitcoin.

Should this level fail, the 55-day SMA is slightly above the $2500 level, which was seen as resistance, then support, back in the spring. All of which means Bitcoin shows strong resilience and is unlikely to crash to zero anytime soon.

A quick look at the daily chart backs this up.

Bitcoin Daily Chart
Bitcoin Daily Chart

Of course, it mirrors all of the comments above on the weekly chart, with the difference being the strength of the pulse signal and the positive DI indicators – these are even more pronounced here.

As for the fundamentals, these too remain strong. It is a win/win for Bitcoin that the price increase means more investors taking the cryptocurrency seriously – and the more people see investors taking it seriously and buying, the more the price increases.

Nikolay Storonsky, CEO, and co-founder of Revolute reiterated in an interview last week that Bitcoin was not a fraud, and several cryptocurrency services were being launched by his company soon.

The first real-time, P2P (peer-to-peer) payments app, for Coinbase users, is being rolled out by Digital Debit (part of Qondado). This will be the first direct challenge by Bitcoin to Zelle, Venmo, Square Cash, Western Union, and other real-time payment systems.

This new development scenario is playing out in other institutional investment circles too, with the news of Bitcoin’s demand has reached such a pace. If the demand continues at its present rate – Bitcoin’s mining electricity consumption will surpass all of the world’s electricity by February 2020. Now there’s a thought…

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin Hits Another New All-Time High Near $8400, What’s Next?

Bitcoin started biting at the $8000 level a couple of weeks ago, but fell back to its previous support, at around $5,600 – scaring lots of newer investors, not used to the volatility and flux of the cryptocurrency markets. Lots though, took advantage of the opportunity presented by the fall, to get into the market for the first time, and they have been rewarded for their optimism. Bitcoin broke another all-time high at the start of this week and yesterday was trading at $8380 which holds as the new record high.

Bitcoin Daily Chart
Bitcoin Daily Chart

Bitcoin is being invested in by people who are not really used to investing. Because of this, the price structure seems to be congregating around the “round thousand” levels. $5,000, for example, remains a huge psychological support level. It is to be seen whether $8,000 becomes another $6,000 resistance level, which took some time to overcome. Another “biggie” lurking in the future, is, of course, the $10,000 level. We believe this will make or break bitcoin. If it can reach, surpass, and sustain $10,000, this will put a lot of the arguments about it being an illusion, as a serious financial instrument, to bed.

For the moment though, this $8,000 level is the one to concentrate on. Chartwise, on the daily chart above, the price has cleared the 21-day EMA comfortably now and is just passing the $8,000 level. Bitcoin is trading at $8264 at the time of writing and holds close to record highs levels. This, of course, is the first sign of it gaining momentum towards the $10,000 target.

Last week, the 55-day SMA  acted as support at the previous level of around $5,600. At this retesting the price was quick to bounce off of it and resume upwards – with the $7,000 level presenting no difficulty this time.

The pulse signal has been positive for the past three days – and has become stronger each time. There is a caution though. The positive directional indicator (green line) is fairly flat around the 30 mark, and the 14-day ADX, itself, the blue line, is also flat and giving no clear direction. We have a divergence signal indicates that this is a “heads up” about a possible change of trend – and this may well be downwards. Until a clearer signal is shown, we need to be alert to the possibility of another retracement back to the £5,000 dollar level. Again, depending on the momentum of this, it could be another opportunity to buy, in the right circumstances.

So much for the technicals – on the fundamental front bitcoin is making news because of a hack, resulting in a $31 million theft from Tether, a cryptocurrency firm. It is thought to be the result of an external source breaking into the network, which uses Polonix, Bitfinex and other exchanges.

The consequences of this news are only just being digested by a market which has been sold on the impregnability of the blockchain and the transparency and openness of its dealings. This could be an Achilles Heel for the crypto world. It remains to be seen whether Tether can contain the damage by “locking” the use of the stolen tokens by encryption and blocking tactics.

Meanwhile, the first listing of bitcoin futures is expected on CME in mid-December. This will boost confidence in cryptos – having the backing of institutional investors has to be a comfort to a market which has never fully shaken the idea that it is a tool of the more shady enterprises out there in cyberspace.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin Hits Another Bump along the Road

Just when investors thought Bitcoin prices were about to go into orbit, it seems to have hit another bump in the road. It was quite a big hole – and this week had many nervous investors running for cover. We think it is safe to come back out now.

Bitcoin Daily Chart
Bitcoin Daily Chart

In last week’s commentary, I mentioned we may see a retracement to the previous levels of support of around $5,600 and to treat this as a buying opportunity for those who missed out in previous weeks since the rally in September.

As we can see from the chart, in the top circle, bitcoin reached the $8,000 mark, but it may have overstretched itself, and fell back to just above $7,000. The intent is there but until more investors are behind it, the force behind the momentum does not seem to be sustainable.

The bottom circle shows, quite clearly that the price bounced off of the 55-day simple moving average (gold line), which we find to be the first point of key support in any retracement scenario. Since then the price has bounced back upwards, and there is every reason to think it will keep doing so, having established support around the $5,600 area in previous weeks.

In the middle circle, the blue, 21-day exponential moving average line has, of course, stalled. This is now the new resistance line to be breached if bitcoin is to continue its previous trajectory to the $10,000 level.

In the “worst case scenario,” should bitcoin fall below both the $5,600 support level, and the 55-day simple moving average, the next major support level is at $3,600 and even this is below the psychological $5,000 level.

Given the volatility of this cryptocurrency, $3,600 is not an impossible forecast but it is very unlikely that bitcoin will fall through all of these major areas of support. We see any fall back reaching the 55-day simple moving average and the $5,600 level and even the $5000 level as further buying opportunities.

So much for the technicals then – what about the fundamentals?

Interest in cryptocurrencies has never been so widespread or keen as it is at the moment. People who had never heard of bitcoin just a couple of weeks ago are speaking avidly of it as the next “big thing.” More and more clients are asking how they can buy them.

This phenomenon will feed the momentum in the markets and give a good foundation for future growth. The continued acceptance of institutional investors (more, it has to be said, in the blockchain, than in cryptocurrencies themselves) will mean even further credibility is added to the underlying structure, and integrity, of cryptocurrencies, and bitcoin in particular, as the front-runner.

Of course, the cynics will point to the events of this week as a reason to hide from cryptocurrencies.

That bitcoin rallied 11%, trading back above $6,500 in just over half a day, shows volatility and nervousness, following the SegWit2x upgrade to the bitcoin network being called off by the developers. The uncertainty will continue in the upcoming days.

This is still a young, untried, and untested instrument. There is inherent risk in anything as complicated, and new but this is no reason to reject the possibilities out of hand. The blockchain is certainly here to stay and cryptocurrencies will be along for the ride into the foreseeable future.

A bumpy road needs good suspension…

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

$10,000 by Christmas? The Bitcoin Rocket Takes Off…

One of the things that 2017 will be remembered for is Kim Jong Un’s rockets being fired. These, though, are not the only rockets to have hit the headlines this year. Bitcoin is doing a great impression of something about to go into orbit too.

It is hard to remember the excitement back in August when bitcoin cleared $3,000 for the first time. Many people were predicting that it would crash back again and be a tulip bulb mania scenario all over again.

We are now just three months further on, and bitcoin has hit the $7,500, more than double that previous high.

A look at the weekly chart almost makes you grasp for the oxygen cylinder as the steep is so high.

Bitcoin Weekly Chart
Bitcoin Weekly Chart

If this momentum is sustained – it is highly possible that the cryptocurrency could reach a staggering $10,000 by Christmas.

As yet there is no technical reason for this rise not to continue. There is no resistance line in sight. The gap between the 21-day EMA (blue line) and the closing price of the bars is widening and the gap between the price and the 50-day SMA is widening too.

The pulse indicators (light green vertical lines) are strongly positive and increase week after week, coupled with the 14-day ADX (light green line) also moving in a positive direction.

Finally, the divergence indicator which showed a positive move back at the end of August (light blue dot) has been true to its word and seen a rise in strength after an initial dip. As with the pulse indicators, the length of the lines indicates a strong signal especially as the magenta tops are also getting bigger.

The wobbles over the bitcoin gold fork seem to have dissipated, and the cryptocurrency has gone from strength to strength. Perversely, it seems that the more it is bashed by the banks and governments, the stronger it becomes.

The Bitcoin price is now way above the $5,000 level, which seemed impossible a couple of short months ago. This will now become the key psychological support that buyers will want to protect. There is very strong momentum behind this upward move. It seems to be a wave 3 on an Elliott Wave projection.

The news that financial industries are planning to introduce ETFs and futures contracts based on bitcoin has further legitimised the digital currency in the eyes of doubters. This will bring speculative money into the marketplace, and push the price further towards the $10,000 mark. These new investors can put it substantial funds into this market.

Be aware, that these rapid markets gains are usually followed by retracements. Any pullback towards the 21-day EMA, or $5,000 level would be a chance to get back into the market if you have missed out so far.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Will Bitcoin Gold Glitter or Tarnish? Bitcoin Gold Prices Dropped Sharply on the First Trading Day

Bitcoin turned another fork on the road this week or more accurately, headed out in a new direction entirely. Bitcoin Gold was released as a way of miners being able to explore new avenues to find those elusive cryptocurrency nuggets. This fork is a blockchain which has been identical to Bitcoin until today. From now, though, Bitcoin Gold will go its own way.

The Bitcoin mining fraternity has come to be dominated by those few enterprises with the computer fire-power to crunch the immensely complex calculations needed to chip away at the codes protecting the coins. Hardware is not the only issue here, firepower needs electricity and electricity costs.

Democratisation was always at the core of Satoshi Nakamoto’s original vision – but cryptocurrencies seem to have moved away from this ideal. Sensing this, back in July, Jack Liao, the founder of Lightning ASIC, a Hong Kong-based mining firm, and a leading player in the Bitcoin ecosphere, muted a fork which would enable this change of course.

To ensure this, one of the innovations is the mirroring of previous holdings. Owners of Bitcoin will get Bitcoin Gold tokens which match the Bitcoin balance in their wallet.

The whole launch has come as a complete surprise to the majority of Bitcoin holders. Most thought it’s a test or beta project with no inkling that it was actually going to happen. It is not just private holders that have been caught out. Several cryptocurrency companies have decided not to support Bitcoin Gold until it has proved its security and “replay protection” capabilities.

Bitcoin Daily Chart
Bitcoin Daily Chart

Bitcoin is stable since the fork and is trading at $5741.3 as of 8:30 GMT.

Bitcoin gold dropped 62% in its first trading day. It was trading at $539 several hours after the launch and dropped to the current price of $118.80.

The question remains whether Bitcoin gold will become a significant cryptocurrency. So far, the launch of Bitcoin gold seems a bit vague as investors and traders are not certain of Bitcoin Gold pricing. Time will tell.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.

Bitcoin – What Happens Now?

Wow – what a week! On Friday, Bitcoin zoomed up past the $6000 level, after worrying everybody it was going to slide back down again just as quickly. A look at the weekly chart shows the apparent strength of its current behavior.

Bitcoin Weekly Chart
Bitcoin Weekly Chart

Everything on the chart is pointing upwards. A point of caution though, the price breached and went beyond the $6,000 level but it has yet to close above it. This would seem to indicate $6,000 may have become the new resistance level for the cryptocurrency.

On the face of it, the weekly chart does not bear this out. The strength of the rise is unquestionable. The 21-day EMA is almost 45° and possibly steepening. The 50-day SMA is steadily climbing and both are way below the lowest of the closing prices.

The second point of caution, though, is shown up by the 14-day ADX indicator (shown in lime green in the second window of the chart). This shows the dip downwards over the past two weeks, even though the pulse signal is strongly positive. This could be an early indicator of a weakness coming into play in the price.

At the same time the divergence indicator has given a second signal confirming the upward trend since when, after tailing off slightly, the indicator has gained positive traction upwards, as shown by the magenta tops to the blue indicator signals, all of which are positive.

Bitcoin Daily Chart
Bitcoin Daily Chart

The daily chart reiterates our caution about a further rise. Once again, like the weekly chart, the price has risen above the $6,000 level but has yet to close above it. This would reinforce our argument about the $6,000 line becoming the new resistance level.

Moving down to the pulse indicator, it can be seen as the color of the last few bars has gone from lime green to dark green, whilst at the same time, the 14-day ADX indicator has been negative and looks like it could be below the median if it continues to decay.

A quick look at the wave indicator shows this has leveled out since the last divergence confirmation, after climbing for several weeks at a fairly steady rate – as shown by the magenta topped, blue pulse signals.

From a fundamental perspective, there are some interesting things going on too.

Over the last couple of weeks, we have mentioned Jamie Dimon and his thoughts on bitcoin. It came as a huge surprise this week, then, that JP Morgan, announced it was giving the green light to a blockchain technology, known as Quorum.

In a collaboration with the Australia and New Zealand Banking Group and the Royal Bank of Canada, “JP” is advancing its in-house blockchain solution. They are hoping to embrace this technology to enhance their backroom operations. The three banking groups believe there are vast savings to be made on international money transfers, loan trading, and securities settlement, along with other financial instruments, such as mortgages.

IBM, too, is investigating in blockchain technology for banks. They are concentrating on the lucrative area of cross-border payments. This is a major headache for the banks as they have to settle accounts in different currencies, with different accounting practices, and, in some cases, transfers taking place at a snail’s pace.

Along with Stellar, a blockchain start-up, and Kickex, a payment company, they are hoping to significantly reduce the cost of global payment transactions for consumers and businesses, at the same time reducing the settlement time.

With international transactions sometimes taking weeks to complete, IBM sees a radical transformation in the offing, to obtaining letters of credit, finalizing transaction terms and providing flexibility and transparency, to the banks, as well as their customers.

This confidence in the underlying system of technology which supports cryptocurrencies such as Bitcoin and Ethereum, will make major inroads into it being accepted within wider financial circles, which in turn will increase its acceptance as a viable alternative to “normal” fiat currencies.

In addition, the Bitcoin network will have to manage the Bitcoin Gold Fork tomorrow that can add volatility and new developments into the desire cryptocurrency.

We believe this can only enhance the price of cryptocurrencies in the longer term.

Noble Gold specializes in IRAs and 401(k) rollovers through precious metals and cryptocurrencies investments.