Even though last week’s market was quite bullish and the trading volume remained consistently high, Bitcoin still failed to break past $5,800 over the past few days and establish a new support level. With bearish pressure appearing near the end of last week, the cryptocurrency slid down, putting hopes of a smooth ride upwards to a holt. Fortunately, the same trend can’t be observed today as most of the current signals are showing that bulls have the upper hand.
One of the most interesting news that surfaced online since our last update was the emergence of an unidentified miner who’s using the name of Bitcoin’s inventor Satoshi Nakamoto. As Yahoo Finance reports, this mysterious miner isn’t really into Bitcoin but its offshoot coin Bitcoin Cash (BCH) and s/he is no joke either. Reportedly, the miner has now taken control of over 44% of the Bitcoin Cash hash rate, being short only 7% of total dominance over the BCH blockchain.
According to Reddit conspiracy theories, the main suspect is self-proclaimed Satoshi Nakamoto, Craig Wright, who allegedly might be working with other partners to manipulate the price of BCH. However, no one can really pinpoint the motive or the identity of the person.
Market is Pro-Buy
In the past week since our previous price analysis, Bitcoin dropped from a weekly peak of $5,522.00 on Thursday evening to its lowest point of $5,181.31 on Friday, only to rise again and stabilize near $5,300. The coin’s price drop coincided with an increase in trading volume, which peaked at $17 billion when the price declined and then stayed mostly around $13 billion from Saturday onwards. As of now, the 24-h trading volume is at $14 billion while Bitcoin’s market capitalization is at $95.3 billion.
Our technical analysis shows that the market is pro-buy, with 10 out of 12 technical oscillators and all 12 moving averages sending a “buy” signal. The SMA 100 is over the SMA 200, telling us that there’s less resistance on the upward path. With Bitcoin breaking over the $5,200 resistance on the dollar and establishing a new high at $5,340 since its drop, we could be looking at a consolidation above $5,300 before further growth. The resistance to watch is near $5,400, which if broken could lead to more gains over the course of the week. On the other hand, if bears return and break the $5,270 support, we will expect another push downwards.
Tether’s Backing Frozen
This week also brought us news of Bitfinex’s alleged cover-up of $851 million in cash that reportedly went missing. According to a press release from Lelita James, the New York Attorney General, the Bitfinex exchange, which shares a parent company with Tether, has been ordered to turn over documents regarding a large amount of cash that was “lost”.
As Ars Technica reports, Bitfinex and Tether can be in serious trouble as they are unable to recover $851,000,000 that have been entrusted to Crypto Capital – a Payment processor based in Panama that’s practically unknown to the crypto world. Reportedly, Bitfinex handed over $1 billion to Crypto Capital without even signing a contract, a large percentage of which can’t be currently located or recovered.
This update should be concerning, considering the allegations that Bitfinex has been borrowing money from Tether to smooth over its financial problems. Being responsible for more Bitcoin trading volume than the US dollar, any eventual crash of Tether due to the loss of its funds could cause big ripples in the BTC market. But as of now, the coin suffered only a minor drop in price this Thursday.