Kategorie: Bitcoin News

Bitcoin news about the Bitcoin (BTC) blockchain and its crypto ecosystem.

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Riot Platforms stock has moved to a bear market: buy the dip?

  • Riot Platforms stock has dropped by over 20% from the YTD high.

  • This decline has happened because of the BTC price dip.

Riot Platforms (NASDAQ: RIOT) stock price has drifted downwards in the past few days as Bitcoin and other cryptocurrencies retreated. The shares retreated to a low of $11.48 in the pre-market session. This means that the stock has dropped by more than 20% from the year-to-date high, meaning that it has moved to a bear market.

Is it safe to buy the dip?

Riot Blockchain is one of the biggest Bitcoin mining companies in the world. It competes with the likes of Argo Blockchain and Marathon Digital among others. Therefore, as in the other mining industry, these companies have a close correlation with the price of the underlying asset.

This explains why the Riot Platforms stock price has jumped sharply this year. Between the lowest point in 2022 and the year-to-date high, RIOT shares were up by more than 338%, making it one of the best-performing stocks in the market.

Therefore, to predict whether the Riot Blockchain stock price will bounce back, we need to understand why Bitcoin is falling and whether it will bounce back soon. As I wrote in this article, the main reason for the crash is that bullish liquidations have jumped in the past two days.

Liquidations happen when brokers and exchanges forcefully close positions of leveraged positions. Therefore, this usually puts prices under pressure.

Another reason why this happened is that Bitcoin recently rose above the key resistance level at $30,000. Historically, cryptocurrencies tend to be a bit volatile when they move above or below a key support or resistance level. 

The other reason is that several regional banks, including Western Alliance Bancorp, published strong results. Its inflows rose by more than $3 billion. As such, the risks of a banking crisis seens like they have been minimized. In a note, analysts at Bernstein said:

“Any potential dislocation, whether on the bank’s credit side, or on the sovereign side …positions bitcoin perfectly as a safe-haven asset alongside gold.”

Therefore, there is a likelihood that Bitcoin price will bounce back in the coming months as the Fed starts to pivot.

Riot Platforms stock price forecast

The daily chart shows that the RIOT share price formed a shooting star pattern on Wednesday. In technical analysis, this pattern is usually a bearish sign. The stock has jumped by more than 25-day and 50-day exponential moving averages. 

It remains slightly above the key support level at $10.53, the highest level on 11th August. Therefore, I suspect that the shares will drop to the key support at $10.53. The stock will then resume the bullish trend as buyers target the year-to-date high of $14.51.

How to buy Bitcoin

eToro

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Bitstamp

Bitstamp is a leading cryptocurrency exchange which offers trading in fiat currencies or popular cryptocurrencies. Bitstamp is a fully regulated company which offers users an intuitive interface, a high degree of security for your digital assets, excellent customer support and multiple withdrawal methods.

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The post Riot Platforms stock has moved to a bear market: buy the dip? appeared first on CoinJournal.

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Bitcoin price falls below $29K, no surprise given volatility and liquidity metrics


Key Takeaways

  • Bitcoin has softened fallen from $30,000 to close to $28,000
  • Our head of research looks into the data, arguing the move should not be a surprise
  • Bitcoin’s fixed supply and lack of dividends or earnings means price is entirely demand-driven
  • Thin liquidity in the Bitcoin market exaggerates every move, with 45% of stablecoins leaving exchanges in the last 4 months
  • Correlation with stocks remains high, with high UK inflation creating pause for thought
  • Market has also peeled back slightly on forecasts for interest rate cuts, and Bitcoin has followed

I have lost count of the number of times I’ve been asked “Why is Bitcoin going up?”, or “what is driving this Bitcoin sell-off?”. 

For many assets, it’s clear as day as to what is driving the price action over any given trading period. Earnings forecast missed by 10%? Hello, red candle. Warren Buffett announced a mass purchase of your stock? Buckle in; we’re heading north. 

For Bitcoin, it’s a little tougher. There are no dividends or dividend forecasts; Bitcoin pays no yield. Nor are there earnings. Additionally, the supply doesn’t waver, instead it follows a pre-determined schedule set by Satoshi Nakamoto in October 2008, governing it block by block in ten-minute intervals. 

With the supply set in stone and out of the picture, and the absence of any periodic yield/forecasts derived from dividends or earnings, this means that the Bitcoin price is all about demand. And that is very difficult to predict. Bitcoin gonna Bitcoin, is often about the best reasoning that can be given. 

But there are factors we can assess. One is liquidity, which I touched on in a recent deep dive as Bitcoin surged beyond $30,000 for the first time in ten months. Order book liquidity is as thin as it has been in a year, while overall capital has fled the crypto space at large. Take a look at the balance of stablecoins on exchanges:

That is 45% of the stablecoin balance taking the exit door in the last four months, the balance as low as it has been since October 2021. 

With Bitcoin already uber-volatile (VIX metric blows that of any “normal” asset out of the water), this amps up its propensity for violent moves even further. In simple terms, thinner liquidity means it takes less action to move the price. 

Why is the Bitcoin price currently falling?

So, it is often difficult to ascertain why Bitcoin is moving, as this thin liquidity and capricious demand combine to make it very sensitive. 

But sometimes, we can make educated guesses as to what moves Bitcoin on any given day. This is one of those moments. 

Macro conditions have long been the key for Bitcoin. Again, a little chart to show this:

Despite some temporary optimism that Bitcoin was decoupling as investors fled a collapsing (fiat) bakning system for the safe haven that is Bitcoin, the orange coin is very much moving in tandem with high-risk assets, such as tech stocks listed on the Nasdaq.

I wrote a deep dive at the time of the banking crisis as to why Bitcoin’s dip in correlation with stocks was just a temporary blip. Looking at the data, it appears to have come back up.

And looking at wider financial markets in the last few days, optimism over the economic climate has pulled back. UK inflation was released yesterday, holding firm in the double digits, fuelling the expectation that the Bank of England will hike further. 

Over in the US, Atlanta Federal Reserve president said he expected another 25 bps hike, casting another bit of doubt for the market that hikes may not be done quite yet. 

Not to mention a rally can’t go on forever. Bitcoin has been on a tear this year, up 74% year-to-date. It’s an asset which has always oscillated, so it’s not a surprise that it is finally showing a bit of weakness. And a fall from $30,000 to $28,000 is merely a drop in the ocean compared to what it is capable of. 

A true Bitcoin red candle cannot be ruled out here, given the volatility and thin liquidity, just like it could suddenly surge further north. As financial markets adjust to new data all the time, like the all-important inflation readings and FOMC minutes, Bitcoin will continue to move like a levered bet on tech stocks. 

As for what direction it will move in, that is anyone’s guess. I don’t have a crystal ball, and I won’t make any predictions just for the sake of it, because I simply don’t know. Not many people do right now, with the world in a precarious state economically. Inflation is still high, yet interest rates are apparently coming to the end of the tightening cycle. 

Soft landing, hard landing, something in between? The future will tell. But whatever happens, the volatility of the world’s biggest cryptocurrency is very real, and abrupt price reversals and large swings won’t stop anytime soon. Bitcoin gonna Bitcoin. 

The post Bitcoin price falls below $29K, no surprise given volatility and liquidity metrics appeared first on CoinJournal.

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Interactive Brokers’ chairman on bitcoin: ‘it’s worth nothing but I own some’

  • Thomas Peterffy owns bitcoin for an unusual reason.
  • He says crypto activity at IBKR has been very slow.
  • BTC is trading well below the $30,000 level today.

Interactive Brokers – a financial services company that enables 24/7 trading of bitcoin reported weaker-than-expected earnings for its first financial quarter this week.

Chairman Peterffy’s view on BTC

On Wednesday, discussing the earnings report with CNBC’s Andrew Ross Sorkin, the firm’s chairman said he owned bitcoin albeit for an unusual reason.

As far as I’m concerned, it’s worth nothing. But I own some even though I believe it’s worth nothing because other people believe that it’s worth something.

Thomas Peterffy also revealed that he did not have a view on where the bitcoin price may be headed from here.

The world’s largest cryptocurrency is trading well under the $30,000 level today perhaps as investors moved to capitalise on its massive run to the upside in recent months.

Crypto trading has been slow at IBKR

Interactive Brokers recorded a 21% annualised increase in customer accounts in its recently concluded quarter to 2.20 million.

Revealing how crypto contributed to the platform’s financial performance in Q1, Chairman Thomas Peterffy said on CNBC’s “Squawk Box”:

Crypto activity on our platform is very slow. We don’t custody crypto – that may be a reason. But generally, crypto trading is much reduced from where it used to be a year or two ago.

He doesn’t have a bullish view on the equities market either and said the S&P 500 should be trading about 20% lower than where it is now.

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Opinion: Volatility lowest since January, but until it drops further, Bitcoin serves no purpose

  • Bitcoin’s volatility is a massive problem, writes our head of research, Dan Ashmore
  • The volatility is the lowest since January, but that doesn’t provide much solace with regards to Bitcoin’s actual utility
  • For Bitcoin to deliver on its potential, it needs to become boring, with volatility closer to gold’s famously steady return profile

It’s relatively calm in Bitcoin markets right now, but that won’t last long. And it’s a massive, problem. 

First, let us look at the short-term volatility, because I noticed over the last few days that is has come down a little. Plotting the 1-month volatility on an annualised basis, we are at the lowest mark since January, when this little Bitcoin surge was kicked off. 

OK, fine. 

But don’t confuse that with a steady market. The crypto markets remain highly capricious and capable of swinging back and forth and eye-watering speed. Volatility is still close to 50%, which in the context of any regular market, is truly insane. 

Perhaps plotting the daily returns of Bitcoin against that of Tesla shows this better. Tesla is just about the most extreme member of the S&P 500, its stock price more volatile than its CEO’s Twitter feed. Comparing your volatility to Tesla is like comparing your ability to run a football team to Todd Boehly (seriously, wtf). 

And yet, Bitcoin’s daily price changes not only match Tesla, but commonly exceed it. 

Indeed, if we plot Bitcoin’s volatility back over a longer time period, we see that these fallow periods do occur, but rarely last long. Bitcoin and volatility are like Frank Lampard and Chelsea, apparently – occasionally apart, but you know that before long, they will be back. And they are terrible for each other. 

Make no mistake about it, volatility is one of Bitcoin’s greatest drawbacks. It is difficult to imagine the asset ever achieving anything remotely close to a store-of-value status while it oscillates back and forth like it does. 

If the ultimate vision for Bitcoin is some sort of digital gold, it has a hell of a long way to go. Flipping the earlier comparison from Tesla to gold is more apt, and puts the chasm between the two assets up in lights:

Obviously, this could all change in the future. I don’t have a crystal ball. Regarding Bitcoin’s ultimate vision, it simply has to, because as it currently stands, Bitcoin is not achieving anything. 

The arguments commonly point to the developing world. Bitcoin can offer a greater place to store one’s financial wealth, they argue. Again, this may prove true in time, but even a collapsing currency like the Argentinian peso is not as volatile as Bitcoin. A gradual decline such as the peso (and I am using gradual a bit liberally there, admittedly) is at least easier to plan for than Bitcoin, which can quite literally be 20% lower in the space of a couple of minutes. 

While Bitcoin is capable of these massive price moves, it isn’t in a place to help anyone. That argument is currently better served to stablecoins, pegged to fiat currencies like the US dollar, which can be equally accessible but don’t swing in price (at least, the prudently-designed ones don’t). Now, their flaws could fill a whole new article which I won’t get into here, but the point is this: Bitcoin is literally useless while its volatility is as high as it currently is. 

My friends often poke fun at me for chatting about gold, or doing analytical pieces on its price drivers. Boomer, they call me. And that’s fair – gold is boring as f**k, and watching its price chart is like watching paint dry. But that is kind of the point, isn’t it? Gold is a store of value, and therefore it should not be printing gains and losses that get Robinhood investors all hyped up. Otherwise, it wouldn’t be doing its job. 

Bitcoin is the same. It needs to take a leaf out of gold’s book and become boring. Until that happens, there is no point to this mythical asset beyond wild speculation. 

The post Opinion: Volatility lowest since January, but until it drops further, Bitcoin serves no purpose appeared first on CoinJournal.

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Bitcoin price prediction: Analyst says BTC is poised for a retest of $28,800

  • Bitcoin price has dropped below $30,000 to currently trade near $29,480.
  • Crypto analyst Rekt Capital says BTC price could retest $28,800 and establish it as a major support area.
  • BTC price bounced above $31,000 last week, having struggled to break past the anticipated buffer zone.

Bitcoin is trading around $29,479, about 3% down in the past 24 hours and now just 4% up in the past seven days. After trading to highs above $3,100 and then retreating to current levels, the market might have to brace for a retest of $28,800.

That’s today’s Bitcoin price prediction as shared by crypto analyst Rekt Capital.  

Bitcoin price at key area, with possible dip to $28,800

Following a retracement to lows of $15,500 in the aftermath of the FTX debacle market rout, Bitcoin price saw a decent flip in 2023. An upswing off the post-death cross retracement of the bear market saw BTC recover more than 80%.

According to Rekt Capital, the rally to $30,000 area had BTC trending at an area that has previously acted as a stubborn resistance as well as support zone on the monthly chart. Bulls managed to breach the supply wall last week, but the $28,800 was equally resolute and despite a decent weekly close above the zone, a fresh dip to the level is likely.

Such a retest might be what buyers need to solidify it as a demand reload area. Rekt says a successful retest of the level could reenergize bulls for another upward move.

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