Market report

WHAT YEAR IS IT?

London Block Exchange

15th March 2018

Take your profit pills and put your helmet on

WHAT YEAR IS IT?

Take your profit pills and put your helmet on

Crypto markets are floating in the most peculiar way since 2014. All the previous dips so far shared signs that the bullish trend was to continue, but for the current one and that experienced four years ago it’s a lot less clear — so it’s apt to ask what year it is. Still, it’s clear now that in 2018 the innovation and maturity levels of the space are different.

Nevertheless, one hour after we sent yesterday’s ‘dead cat bounce thought experiment’ report, bitcoin’s price declined about 5%, from £6.5k ($9.1k) to £6.2k ($8.6k). Then, one hour after the rumoured ‘three o’clock dip’, bitcoin plunged a further 5% from that point to £5.9k ($8.2k) — breaking the 2017 log channel support line for the second time in 2018.

By 22:00 GMT it seemed to have found some support at £5.7k ($7.9k) but, after a successful bear flag, day traders were already looking at lower targets. While such a large drop wasn’t expected so soon, it seems like market makers shorted massively on the news that Google was banning cryptoasset related ads from June onwards.

THE IDES OF MARCH

Major FUD. Panic control. People stepping through the door.

As the top 100 projects are down 20% on average today, let’s take a step back and look at the current scenarios — while also reviewing the key lessons of this waiting game. The first thing to note is that if you look at this chart comparing the two major bear markets referred to above, you’ll see that the current dip is happening much faster.

This could mean that the past months’ bubble is similar to the one that popped in 2013, before the 2014 parabolic run — which was even more extreme than the 2017 rise. The fractal in play here is that we could be in for continued sideways action around today’s price range, before moving to the predicted £43k — £72k ($60k — $100k) 2018 bull run.

There’s a different kind of FUD in the market today, however, with rumours that the People’s Bank of China is going to release a document today that could wreak havoc on the market (although it’s 16:00 in China already and nothing has been announced so far). Large Chinese mining operations could be playing out the old ides of March narrative, as we may not yet be close to the bottom. The bottom might be around £2.9k ($4k), which is an average break-even cost for mining one bitcoin — let’s hope for the best but expect the worst.

WHAT TO LOOK OUT FOR

Filter the noise and stay ahead of the pack

LBX is opening up its app to Premium members next Monday — offering access to the UK’s Faster Payment System.

TokenFest — a major two-day blockchain conference in San Francisco — starts today, with speakers ranging from Tim Draper, the renowned VC, to Kathryn Harrison from IBM. Follow the event here.

Some people are calling for bitcoin to double bottom at £4.3k ($6k), but more classical technical analysts deny that possibility. Keep following the price!

WHAT TO READ TODAY

An insight a day could give you more profits to play

Yesterday’s Congressional hearing was also a bit bearish, but overall was unlikely to have influenced price action. You can watch the full video here or read this summary.

Are cryptoassets a cult? As no insider will tell you, it’s interesting to read an outsider’s perspective — so here’s a nice overview of the ‘Zealots of the Blockchain’.

To finish with a silver lining, billionaires are still bullish on bitcoin and are planning to keep adding to their holdings. Alan Howard, a hedge fund manager, is in for the party.

  • bitcoin
  • google
  • fud
  • LBX
  • dead cat bounce