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Will this trigger an accumulation drive in Bitcoin investors?

Will this trigger an accumulation drive in Bitcoin investors?

Bitcoin investors are a very interesting group of people. Their behavior has no strict pattern, no orderly response. In a way, they complement the crypto space. This time around, they are not behaving as the market would expect them to, and have instead resorted to … doing nothing. But why?

Why are Bitcoin investors doing nothing?

Bitcoin investors haven’t moved their holdings much. One reason for this could be the slow growth of BTC, which had this halving. Since the May crash, BTC’s growth has not been as good compared to growth since the second halving. At the moment, BTC is still 5x behind where it could have been. Understandably, this may have made investors feel depressed.

Bitcoin and Ethereum growth comparison | Source: Ecoinometry

In addition, a solid and profitable market usually observes accumulation or profit-taking. However, this time around, investors haven’t resorted to either.

Stock market balances show that the accumulated balance has dropped to around 2.4 million BTC, the lowest level since August 2018. However, this already happened on September 17th.

Bitcoin exchanges balance | Source: Glassnode – AMBCrypto

Since then, the indicator has been and remains flat. This means that accumulation has been idle for almost a month.

It’s not the best, but it’s not the worst either. Although the accumulation has slowed down, the lack of an increase in balance means that sales have not increased either.

In addition, the liveliness indicator is at its lowest level since February of this year. The lower the vibrancy, the higher the number of bitcoins generated and less the older coins destroyed.

The vibrancy of Bitcoin | Source: Glassnode – AMBCrypto

This could be the trigger needed to restart the accumulation drive.

How come?

At the moment, Bitcoin continues its rise in the charts. Since the beginning of the month, BTC is up nearly 26% and has even caught up below $ 55,000 today, trading at $ 55,284. This could create the upward movement necessary to get what is needed.

Bitcoin price surge | Source: TradingView – AMBCrypto

In addition, in less than a week, the Fear and Greed index switched from “extreme fear” to “extreme greed” and that is a good indication of investor sentiment.

Bitcoin Fear and Greed Index | Source: alternative

Investors should also remember that the king coin isn’t the only cryptocurrency in terms of slow growth. Ethereum, too, along with the rest of the market underneath, is lurking where it should have been. So it may take some time to meet expectations, but investors can rest assured that nothing bad will happen either.

Thus, the growing institutional appetite is increasing the dominance of Bitcoin

Thus, the growing institutional appetite is increasing the dominance of Bitcoin

With the price of Bitcoin comfortably above $ 50,000 for over five days, its market monopoly appeared to have returned. With high weekly profits of over 15%, the king coin outperformed all coins in the top ten list by market capitalization for the past week.

After this price breakout, Bitcoin’s dominance rose to 45%, its highest level since August. So what fueled Bitcoin’s growing dominance?

Growing institutional interest

Last week, when $ 100 million worth of BTC left the centralized exchanges, the behavior indicated that investors wanted to hold. More importantly, the number of large transactions, including those valued at over $ 100,000 on any given day, has also increased. In general, large transactions act as proxies for institutional activity because of their size.

Source: IntoTheBlock

Notably, the number of large Bitcoin transactions hit a four-month high, with over $ 240 billion per day being transferred for three consecutive days. This was an indication of a growing appetite among institutions investing in the royal coin.

In fact, on Oct. 8, JPMorgan shared a note with its clients in which the company attributed the recent spike in BTC price to institutional investors looking for some hedge against inflation. Notably, the company took a completely opposite view on the top coin earlier this year in May, as JPMorgan analysts noted that large investors were switching from Bitcoin to traditional gold at the time.

Healthy Derivatives Data

The chances of a Bitcoin ETF getting approved by the end of October seem increasingly bullish. Eric Balchunas, Senior ETF Analyst at Bloomberg, gave the decision a 75 percent chance of being approved in October.

With this positive news and high expectations for the king coin, the derivatives market is also seeing some decent moves. In particular, the financing rates of the three most traded stock exchanges reached their highest level since May before the crash.

BTC Funding Rate | Source: IntoTheBlock

When the funding rates are positive it means that the asset is priced with a markup and long holders must pay a fee to short holders. At the time of writing, long holders willing to pay the financing fee to buy Bitcoin Perpetuals point to positive expectations for the price.

However, the subsidy rates are still significantly lower than in February and April.

In terms of metrics, BTC’s aSOPR notes a similar upswing that was seen in October 2020, propelling the coin up 250%. So if aSOPR’s uptrend continues, a similar breakout could be expected for BTC.

For now, however, it seemed like this BTC run could do incredibly well for the top coin as the derivatives dates look great and institutions are jumping on the BTC train.

A decade later, Litecoin actually lives up to expectations?

A decade later, Litecoin actually lives up to expectations?

Immediately after Bitcoin was introduced in 2009, a variety of other cryptos including Namecoin, Ixcoin, Tenebrix, and Solidcoin made their debut. However, most of them disappeared from space within a very short period of time.

Litecoin is still one of the few coins that has survived successfully. In fact, “Silver to Bitcoins Gold” is about to complete a decade in this area. After overcoming a multitude of obstacles on its way, Litecoin finally seems to have made a good impression on the crypto-verse.

Surprising growth

Like every other “newbie” in this field, Litecoin also struggled to gain traction in the first few years. After the total number of addresses remained below the 10 million mark for more than five years, the number of addresses increased significantly fivefold in the period 2018-21.

Oddly enough, it was just under 100 million at the time of writing. The recent surge was clearly evidence of Litecoin’s steady and organic growth.

Source: Glassnode

In addition, the most important metric for the coin’s life – the dormant period – showed that the general accumulation trend was still in play. As such, the average coin idle describes the average number of days that each coin remained unmoved.

This indicator has recently been at a relatively moderate level, which means that the expenditures / realized destructions are checked in relation to the transactions.

Litecoin’s profitability aspect has also improved over time. As shown in the attached ITB graphic, more than 70% of the HODLers were currently “in the money”. Conversely, this meant that the remaining 30% was either in a loss or break-even position. Given the current state of the market, these numbers seem pretty decent.

In terms of the broader trend, LTC has delivered significant returns to investors during every uptrend in the market and also suffered valuation discounts during downtrends. In short, over the decade, the rising tide of the market has mostly raised Litecoin’s boat and vice versa.

Source: IntoTheBlock

The only question mark

Even if the coin was able to hold its own on the above-mentioned fronts, the development-policy facet has been malnourished since its introduction – at least that is what part of the community believes. In fact, constant ridicule of non-usefulness and redundancy has always been around the coin. So are such labels really justified?

By and large, no. First of all, it should not be forgotten that LTC has been able to sail successfully all these years with the “expectation baggage” on its shoulder. In fact, it has rarely complained about it.

Next, comparatively “old” protocols usually take time to develop and adapt to a changing ecosystem. At this point, Litecoin only needs some space. Notably, it took SegWit some time to become a reality on Litecoin, as did its first cross-chain swap or any other development. The question no longer arises if, but when, Mimblewimble, Smart Contracts and NFTs go completely live.

Given the planned developments in the pipeline, it would not be wrong to claim that Litecoin ages as well as good wine. After the above upgrades, optimizations, and additions, the network would end up being more relevant than ever.

If the growth pattern becomes even more constant anytime soon, LTC could eventually break the shackles of the broader market trend and surprise its HODLers by initiating independent rallies.

Binance Coin: How Traders Can Short This Setup And Make Profits

Binance Coin: How Traders Can Short This Setup And Make Profits

Given the weak on-chain activity and little progress on the development front, it can be assumed that retail interest appears to be the main driver for Binance Coin. The Alt didn’t disappoint when it came to keeping up with broader market trends, especially recently after BTC hit the $ 55,000 mark back.

However, a minor correction in the broader market resulted in some declining predictions for the world’s fourth largest altcoin. Its bullish structure was threatened due to a possible collapse from an upward channel. At the time of writing, BNB was trading at $ 421, down 4.3% over the past 24 hours.

BNB 4 hour chart

Source: BNB / USD, TradingView

The BNB saw a third attack on the lower trendline of its pattern, which coincided with a support line of $ 420. With the 4 hour 50 SMA (yellow) turning bearish, sellers had the momentum to force a breakdown from the BNB’s setup.

A move below $ 4250-420 could trigger an immediate 4.5% decline towards the confluence of the 4-hour 200 SMA (green) and the $ 400 support. If buyers are unable to strike back, the BNB could continue to bleed until it hits an important line of defense of $ 385. Overall, this would correspond to a sale of 8.5% compared to the state of the BNB at the time of going to press.

On the flip side, a rebound above the 50-SMA would reduce the chances of lower earnings. Bulls can target a new higher high around $ 450 after negotiating past the centerline of the pattern.

argumentation

Interestingly, the indicators were on the bear side and showed several sell signals. For example, the RSI could not find support at the midline and was now in the bearish territory. Moving below 40 would increase selling pressure.

The agreed Awesome Oscillator agreed after moving below its half-line on the back of a bearish twin-peak setup. The MACD did not do so well either. Consistently lower peaks were seen on the index on the way to the equilibrium mark.

diploma

Based on the above factors, BNB has been recommended in the upcoming sessions to break out of their upward channel to the south. Traders can capitalize on taking short positions once the BNB closes below $ 420. A reasonable take profit can be set at $ 400 while stop losses can be placed above the 50 SMA at $ 430.

A to Z, identify how and why Fantom did so well

A to Z, identify how and why Fantom did so well

In the midst of a market that has been picking up since the beginning of the month, Fantom made a dent in the DeFi and Spot area. It even left Bitcoin and Ethereum behind. The last 7 days have gone so well for investors that even the most ignorant have spoken about it.

However, being popular and being profitable are two different things. So what is Fantom now exactly?

Record a meteoric rise

The word “meteoric” is not used liberally here as Fantom has broken records in the past few days. Fantom was actually the eighth largest blockchain in terms of DeFi Total Value Locked (TVL). Today it is the fourth largest. In just a few days, it has broken through blockchains like Polygon, Terra, and Avalanche – each of them have registered their own increases lately.

On October 6, Fantom’s TVL was $ 2.4 billion, a number in line with the steady increase it had seen before. In the 48 hours that followed, it rose $ 7 billion, and at press time it was $ 9.01 billion.

Fantom’s DeFi-TVL | Source: DeFiLlama – AMBCrypto

But that’s not all. Fantom has only gained over 30 protocols since its inception. Even so, the network’s countless partnerships and ecosystem-centric updates over the past 6 months have resulted in the TVL increasing by 16,853,800% overall!

Yes, so much.

What explains this hike?

While there is no explicit reason why the network has seen such a sharp rise, the rise of NFTs definitely deserves great credit. For this reason, some of its protocols have also increased significantly in value.

Protocols like Anyswap, the NFT marketplace PaintSwap, and Shiba Fantom all rose 235%, 91% and 155%, respectively.

Additionally, the network’s token FTM itself rose 87.3% over the course of the week. Bitcoin and Ethereum, on the other hand, only gained 24% and 20% respectively.

Fantom price promotion | Source: TradingView – AMBCrypto

In addition, the network already has a solid participation rate and positive inflows. More than 35.1% of the addresses have some balance on the network. As the network promises to have solved the “trilemma” of decentralization, scalability and security, Alex Svanevik, CEO of Nansen, recently said:

“I’m very excited to see what’s to come.”

Fantom’s addresses | Source: Intotheblock – AMBCrypto

However, that doesn’t tell us the full story.

Keep the following in mind – the network’s current volatility combined with the Relative Strength Index (RSI) foray into the overbought zone (see FTM price action image) suggests that a price decline may be unexpected.

Fantom’s volatility | Source: Intotheblock – AMBCrypto

So new investors better step in cautiously. Think about what happened to SHIB yesterday when it fell 18% in one day after hiking 253% over the course of the week. Well, this example is not intended to establish any equivalence between a meme coin and a functional altcoin. But the point remains that it is best to be wary of alts that are making headlines in the markets so unexpectedly.

Solana’s growth has been more than organic, but here is a word of caution

Solana's growth has been more than organic, but here is a word of caution

The third quarter of the year was both exciting and nerve-wracking for most in the crypto community. And while both Bitcoin and Ethereum had positive quarters, the big winners were actually newer protocols. Indeed, with the advent of projects like Solana, Avalanche and terra. All of the above were up at least 300% on the charts.

Although the Ethereum network saw strong adoption by new users largely due to the rapid rise in NFTs, it suffered from record high transaction fees throughout the year. That includes a total of $ 1.96 billion in fees in the third quarter alone.

This benefited competitive smart contract platforms and so-called “Ethereum killers” like Solana and Avalanche as users looked for inexpensive alternatives to Ethereum.

In particular, SOL’s price rose nearly $ 200 in early September when ETH’s average transaction fee topped $ 55.

Source: Coin Metrics

With the price of SOL and the median transaction fee from ETH seeing matching highs, there was speculation about an Ethereum-powered rally by SOL. Was that all that made SOL grow?

More biological than it seems

The August-September rally was dubbed “Solana Summer” by many in the market when the price of the old hit $ 200 per token. This was from a modest $ 2 at the beginning of the year. However, shortly thereafter, the asset saw significant consolidation after its ATH of $ 215 as pessimism took over. This only fueled speculation about a SOL rally initiated by ETH.

However, Solana’s rally was far more organic than it seemed. In particular, Solana’s DeFi projects exceeded $ 3 billion in September this year. The sheer increase in projects for SOL has proven that it is capable of creating tough competition for ETH and other ETH killers.

Solana also took advantage of the explosion in NFTs to fuel its growth as an interoperable blockchain platform. In fact, NFTs on SOL hit a market cap of $ 1 billion on October 2nd.

While SOL’s spot market had low trading volume and lower price expectations, the futures market offered better prospects. Open interest for the altcoin has seen a surge in recent days, suggesting an increase in the number of outstanding contracts from market participants.

This also underscored the fact that new capital has flowed into the coin’s markets.

SOL Open Interest | Source: Coinalyze

Get risky, but persevere

The Solana market has been unresponsive lately, but the altcoin has been clinging to the higher resistance of $ 164 for an extended period of time. Additionally, positive news like Ubeswap, which announces a collaboration with Allbridge to bring both Solana’s native asset ‘SOL’ and Sabre’s governance token ‘SBR’ to Celo, gave the needed social pump. Regardless of the included prices.

However, at the time of writing, SOL’s Sharpe Ratio had gone into negative territory and hit July levels while volatility also eased. The decline in the Sharpe ratio of the Alt seemed to indicate that SOL had become riskier in performance over a period of time relative to a “risk free” asset.

Even if a price pump could reverse that damage at the time of writing, it seems unlikely that SOL will see a sustained rally anytime soon.

Even so, Solana’s growth was too great to ignore. In addition, crypto has held its place on the charts in seventh place despite its consolidating prices. While daily and weekly gains of “only” 2.89% and 10.10% respectively are achieved, there could be a stronger comeback if altcoins really do recover.

Chainlink has high upside potential, but are there any real entry points?

Chainlink has high upside potential, but are there any real entry points?

With Bitcoin leading the market gains with a weekly price increase of nearly 16.90%, the rest of the market has remained rather calm. While the market appears to be seeing a steady upward move due to Bitcoin gains, most of the alts did not surprise the market. Chainlink, which ranked 15th in terms of market capitalization, also saw a rather stagnant price movement.

While the old’s long-term prospects looked attractive, there seemed to be a lack of market confidence around the old, so where could LINK go from here?

Classic case of frustration and difficulty

In the final quarter of 2020, Chainlink was among the top 5 crypto assets in the room. With Defi’s explosion, many altcoins went up, but LINK’s increase compared to the market was small. With the Alt now down nearly 10 ranks and ranking 15th in importance and pecking order, the asset seems far from the investor spotlight.

Source: TradingView

LINK’s market looked stagnant in terms of fund inflows as its Relative Strength Index maintained a horizontal trend on a daily chart for almost a week. This type of steady rate was indicative of a lack of cash inflows and confusion in the market about the price of LINK. Apparently, LINK’s price was in a cloud, representing a classic case of frustration and difficulty for traders.

Upside potential remains

On the weekly chart, LINK was at a bottom and it was noteworthy that while the downside risk is limited, the upside of the old looks good. Analyst Nelson Paul added that placing a bet on LINK could be a good strategy for the coming months and that “the Alt can target a three-digit price”.

Especially on the development front apart from Announcements of the partnership In other blockchain projects, LINK has played a decisive role in both the defi and the NFT space due to its oracles. Chainlink oracles provide real-time data to the smart contracts that make trading these NFTs easier.

Recently, fintech firm Spartan Hill announced it was integrating Chainlink Price Feeds to power a new decentralized Colombian peso stablecoin called Daily (DLY). While these evolutionary updates didn’t add much to the price of LINK, the metrics painted an optimistic picture for the altcoin.

So is this a good entry point?

In particular, LINK’s NVT was in an ATH at the time of writing. These high values ​​were last recorded in July 2020. This could either mean that the network rating exceeded the submitted value. This can happen when the network is growing rapidly and investors rate it as a high return investment. On the other hand, his active addresses were nearing an all-time low, which was worrying.

Source: Glassnode

However, a downward trend in the Herfindahl index, which suggests that funds are more evenly distributed across addresses, was a good sign for the network. Additionally, the MVRV (7-day) for the asset had bottomed out, signaling a reversal that could do well for the old.

LINK’s short-term ROI, while negative, was only -0.89% which didn’t look bad, while the 3-month and 1-year ROI were + 47.91% and + 181.69%, respectively fraud. With LINK’s prices stagnating and Alt showing upside potential, levels below USD 28 seem like a good entry point into the market.

Can Bitcoin Investors Still Remain Consistent?

Can Bitcoin Investors Still Remain Consistent?

There has always been a significant difference in the behavior of Bitcoin holders. Short-term investors tend to act much faster than long-term investors, and buying and selling are always more frequent for them than for others.

However, some of these short term investors know how to build their portfolios and eventually become medium to long term investors.

The question is: can we expect systematic behavior this time?

HODLer yes, but what kind?

Short-Term Trader / Holders (STH) are known to take profits during a market high. However, some do HODL for a long time in the hope of a rally. Others give in as soon as they sense declining momentum building.

This can be seen in examples in 2018. Participation rose back in January, when Bitcoin was close to its previous all-time high of <$ 20,000. STHs peaked and the subsequent upward trend continued for the following months.

This despite the fact that the price movement was fairly flat and mid-term owners had peaked in November 2018.

However, when BTC fell in November 2018, all medium-term owners also sold their holdings.

Distribution of Bitcoin Holders | Source: Glassnode – AMBCrypto

Usually, medium to long-term owners (LTH) are not easily scared. If you look at investor behavior during random price drops, be it October 2019 or March 2020, you will find that the sale was minimal.

This shows that these holders start to accumulate when bullish momentum starts but don’t sell during the first crash. They only liquidate their holdings when this declining momentum peaks or when they want to take profits.

What next?

At the moment, the number of medium-term owners has risen again due to the increasing upward movement in the market and is currently at a 2-year high, which represents 19.7% of the total supply. These are BTC holders of coins between the ages of 6 and 12 months. This means they have not been sold during the entire ATH, crash, rally, or consolidation since April.

In fact, the longest Bitcoin holders (over 10 years old) didn’t flinch at all. In fact, their holdings have grown and now represent over 12.25% of the supply – about $ 124 billion.

10 year old BTC coins | Source: Glass knot

While these could be lost coins or wallets from pre-ASIC era miners or simple HODLers, it cannot be said with certainty.

The focus is that MTH and LTH were not sold in September when BTC fell 16.85%, hopefully they will not continue to sell as BTC has already risen 27.07% last week.

BTC price promotion | Source: TradingView – AMBCrypto

You miss that when Ethereum leads the way in this regard

You miss that when Ethereum leads the way in this regard

Ethereum as the second largest cryptocurrency continues to surprise investors and observers alike. If you look at the asset’s price history this month, it might not look like it, but there is a different market than the spot market where Ethereum killed it last month. If this works, Ethereum could find a new audience.

Price down Amount up?

While September wasn’t the best month in terms of price action, it still saw a sharp surge in trading volume. Total volume increased 13.9%, combining both the prime and subordinate exchanges. In fact, spot market volumes even peaked at $ 161 billion on September 7, marking a 3-month one-day high.

Total volume – spot market | Source: CryptoCompare

The 15 largest “top tier” exchanges made the largest contribution to this increase, with volumes increasing by 10.8% compared to August.

The derivatives market also rose. As leveraged traders continued to invest in the market, their participation did not increase due to bitcoin-related news. This time the rise of Ethereum was spearheaded.

Volumes of the top tier exchanges | Source: CryptoCompare

Led by Ethereum how?

If you look at the derivatives market, you will find that the open interest (OI) in Bitcoin futures products has decreased by 3.7%. Over the same period, Ethereum’s OI rose 4.7%. The case was also the case with perpetual contracts, which have increased 3.7% since August to $ 4 billion.

Ethereum / Bitcoin Futures OI | Source: CryptoCompare

In fact, CME, the world’s largest derivatives exchange market, saw ETH’s OI hit its highest ever level, up 10.5% last month.

Surprisingly, BTC’s CME OI decreased by 3.1% in the same period and the volume of ETH was also able to increase by 34.51%.

The interesting observation here is that all of these gains came at a time when the market was bleeding. In September, the price of Ethereum fell 21.69%. However, the surge in derivatives shows that investors are continuing to focus on leveraged trading.

Ethereum price promotion | Source: TradingVieww – AMBCrypto

This is good because it allows investors with less money to increase their purchasing power, which can increase their returns even if they are long or short.

However, there is also the possibility of a significant market shift should investors liquidate their contracts, which could lead to a sharp fall in prices.

Bitcoin: Assessment of whether fears of a drop below $ 50,000 are justified

Bitcoin: Assessment of whether fears of a drop below $ 50,000 are justified

Bitcoin accelerated faster than the market expected. When the top coin rose over 10% on October 6, its holders were delighted with the bullish momentum.

However, BTC’s price action has been rather limited in the past two days. As expected, this has again led to a certain degree of skepticism on the market.

Even so, the cryptocurrency was trading just over $ 55,000 at press time, with bullish signs dominating the narrative.

But is the skepticism mentioned above justified? Well, there seemed to be strong signs of something else. In fact, there have been strong signals that Bitcoin would hold this level, at least for the near future.

Why BTC won’t go below $ 50,000

When BTC fell in the early hours of October 8th, fears surfaced again. In the lower timeframe, however, Bitcoin saw its price rise again. In fact, the Relative Strength Index (RSI) saw an almost vertical RSI uptrend.

It was noteworthy that every time BTC saw a steep spike in the RSI over the past month, the price has pumped and held higher levels for the days to come. This time around, too, the likelihood of BTC staying above this psychological barrier remains high, as the top coin has held above $ 50,000 alongside healthy cash inflows and currency outflows since October 5th.

Metrics paint a healthy picture

Bitcoin’s (7d MA) hash rate in particular topped 150 EH / s at the time of writing, its highest level since June 6. This was an indication of a healthier and more resilient Bitcoin network.

In addition, the profit from Bitcoin entities rose to 94.3%. This suggests that over 16.2% of all on-chain businesses have returned to profitability since the September lows. The last time so many network companies made a profit was before the May sell-off.

Source: Glass knot

In addition, BTC’s futures perpetual financing rose again to the level of early September, with open interest also remaining elevated.

According to pseudonymous analyst TXMCtrades, this is a crucial time for the price of BTC as some “smoothbrainers” have apparently taken long leveraged positions, making them vulnerable to price differences.

Source: Glass knot

That being said, another indicator that seemed to be pointing to another spike in BTC price was the Pension-Adjusted CDD (SA-CDD).

The Fisher transform confirmed the local soil of the SA-CDD as highlighted by data from Cryptoquants. A local low point suggests confidence is returning for long-term owners who prefer to hold onto their coins rather than spend them.

Source: CryptoQuant

All in all, the key figures speak for a price increase. If the price of BTC breaks down at all in a worst-case scenario, the $ 50,000 mark will likely act as a strong support.