Hi traders, let's talk about the bitcoin market.
Bitcoin.
- The market is still bearish although we've seen some form of strong whale support around the $6600 level...which prompted many bulls to predict an imminent trend reversal despite the fact that this latest balance looks almost exactly identical to the previous one with no significant increase of volume whatsoever:
In my view, whoever is buying at current level is swimming upstream and the daily volume doesn't show any indication that a bullish reversal could be in play;
In my opinion we're primed for more bearishness, based on volume profile I expect the market to create another balance around the $5700 level and possibly to have a decent bounce there especially if the bearish leg leading to it doesn't produce a lot of volume/panic selling;
In my opinion, most traders are using TA to support an erroneous bullish assumption according to which the market could V-bottom at any time when in fact the fundamentals of crypto have never been weaker because of global government crackdown, taxation and technological limitations inherent to blockchain.
In my view, the fundamental will always trump the technical (as we've seen with the rise and fall of Ethereum during the ICO bubble) and these bearish fundamental forces will keep having the upper-hand as long as this regulatory mess around crypto isn't sorted out... which could take a while so get warm and cozy, this crypto winter could be a long one.
Cheers.
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Interesting point of view. I picked that up aswell in one of my latest posts. I think that the demanding side speaks to the bearish fundamental climate aswell. What causes me to be more optimistic though, is the fact that the market-landscape has diversified since the last 37month winter.
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Thanks for your comment @jpmay, definitely the market has changed and I can't see the bear lasting as long as it did back then. Are you holding a lot of crypto right now?
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I don't know what your undersanding of 'a lot' is. But I think of the current situation as a good opportunity to extend my portfolio. Not only the amounts , but the range of different currencies aswell.
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yeah, I also like to buy into weakness and to cost average down, good long term strategy. I've been buying some EOS recently because I expect the price to make a move (or at least to stay stable) as we approach launch :)
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Exactly!
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Coins mentioned in post:
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An opportunity to buy closer to the $4k range is so appealing, but I'm also ready for this bear market to be over, it's giving me cognitive dissonance haha. Thanks for the update! I'll just brace myself and wait it out for now :)
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Thanks @mjo, yeah everybody is on the edge of their seat, this bear market is truly fascinating :)
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This is a brilliant, if sobering, analysis. I believe time will vindicate every descriptive and predictive sentence you've written here. And yet —
The market may be responding rationally to the fundamentals where Bitcoin is concerned, and maybe even a few other coins near the top. However, is it rational to value the Bitcoin currency so much more than other cryptocurrencies? Does it make sense for the entire crypto smorgasbord to follow Bitcoin up and down so closely, as if their fundamentals were aligned with Bitcoin's own?
We don't really know yet if sharding will work, or if DAG ledgers are better than blockchain ledgers, or if DPoS beats ASIC resistant mining, or how soon encryption will face quantum attacks, or whether Turing completeness is an asset on a dapp-supporting platform coin. We don't even know whether more customers want privacy, transactor transparency, or publicity. But we sure as hell know which coinbrands are betting on the rightness of which rival answers — and the market now rarely seems to discern between them.
Why judge the top coins by rational fundamental criteria, if you're going to pretend that so many other coins are just like them?
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Thanks for the kind words @custone, you raised a lot of good points here. I believe that as the crypto industry matures and more and more assets are tethered to fiat we'll start to see less an less correlation between assets. Right now though, every altcoin is slave to Bitcoin even those who don't share the same fundamentals (like Ethereum). Are you personally holding some crypto?
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Yes! Full disclosure — besides the STEEM and SBD that any Steemian can see in my wallet here, I hold some ETH and some Bitcoin Cash, the latter to commission a composer who wanted to be paid in that currency.
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Are you not a fan of Bitcoin Core or are you holding Bitcoin Cash out of fundamentals/technicals?
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I am neither an opponent nor a fan of Bitcoin Cash, but I am holding it because I'm commissioning a musical work and the composer wants to be paid in that currency.
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fair :)
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Which is safer and potentially more profitable to accumulate with dollar cost averaging in case of a bear market reversal? Is it better to accumulate bitcoin, or top 20 cryptocurrencies, or good quality but low cap coins? I guess the right answer is probably diversification.
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Hey @getrichfast, if we reverse and start going bullish again I would definitely trade to accumulate more Bitcoin (mainly) and ETH... EOS might be a good pick too because of the platform launching in June. However, diversification across just cryptocurrencies is not enough to build a solid investment portfolio, you want to have assets that aren't correlated to each other, for example Bitcoin and Gold/Silver
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