Bitcoin and ether reach a key resistance. Is part III the end of this mini-cycle?
News that ICOs raised more funds in the first quarter of 2018 versus the entire year of 2017, seem uncorrelated with the last few months’ bear market. This week’s bullish performance is also fostering confusion amongst some traders — with the total market cap now sitting at £255 ($360) million, a level first achieved in the beginning of last December. Could it be a bull trap?
Bitcoin is getting close to the log scale downtrend resistance line — an area which bitcoin failed to break upwards, twice, since December. Some neutral traders are advising caution. Even if a breakout were to happen, remember price can later continue trending sideways. Contrastingly, here are some recent bullish predictions that are circulating.
Some bears are in disbelief, claiming this week’s alt season is over. Yesterday we shared a tweet storm, which showcased that ether is acting as a leading indicator for the alts cycle. Ether however, stopped at a key resistance overnight. Perhaps there is a need for a more significant rise in bitcoin’s price before alternative cryptoassets go on a run.
We’ll conclude our commentary on the ‘blockchain is not only crappy technology but a bad vision for the future’ article next Monday, so that we can better prepare for the next couple of days. Take a look at this map of the price differences in cryptoassets since Monday. Does it look impressive or average?
Bitcoin is marginally up 2%. Major alts are all up between 10% and 20% — including BCH, XRP, XLM, DASH, XMR, ADA, LTC, and EOS. These are meagre compared to last year’s common +100% gains. The key message here is that if you have missed out on some profits, there’s no reason to FOMO over the weekend unless there’s a clear change in trend. Look at all these historical times where an alt cycle was mistakenly identified.
It’s difficult to get rid of our biases once we have consistently benefited from them. If you were short on alts over the last few months, you were likely doing well until last week. There’s some positive sentiment on social media regarding marginal gains. Here’s a fun fact.
Some say to succeed in crypto you should “know the value of everything and the price of nothing”, so we recommend brushing up on cryptoasset valuation and on these top four ratios.
Jimmy Song, the editor of Bitcoin Tech Talk, is a popular crypto figure. His latest article ‘Why Bitcoin works’ is a review of ‘The Bitcoin Standard’. We also recommend reading this well-written critique of the book and its concepts.
Andreessen Horowitz, a US VC firm, is leading efforts to ensure utility tokens are not deemed securities. Ether is particularly affected as Ethereum was one of the most popular ICOs back in 2014. “Has it become so decentralised that it should not be deemed a security”? Or not?
In case you can’t read FT’s ‘Lunch with Vitalik Buterin’ (tip: use this archived link), we recommend closing the weekend with another god-like figure — Nick Szabo. He told some key banking personalities, at the Synchronize 2018 conference that “people might even hate” them!