Bitcoin: USD/BTC (BTC=X) Increasing adoption, limited supply support price

By December 8, 2019 Bitcoin Business
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Bitcoin: USD/BTC (BTC=X) Increasing adoption, limited supply support price
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Bitcoin: USD/BTC (BTC=X) Increasing adoption, limited supply support price

Bitcoin is winning the adoption race among crypto assets and is becoming increasingly scarce, which favors price appreciation. Plenty can go wrong with a nascent asset, but unless the basic premises reverse — mass adoption and fixed supply — there’s a higher probability to sustain price appreciation vs. depreciation. The primary bearish factor — Bitcoin’s price has appreciated so far so fast — remains the current price headwind. It took almost four years for the prior peak in 2013 to be surpassed.

Normal market maturation suggests surpassing the 2017 peak near $20,000 will take longer. Bitcoin and Tether are winning the race of market depth. The primary stable coin represents many of the issues with most alt-coins — they’re too volatile to be considered currencies, which enhances the allure of Bitcoin.

Bitcoin can add to 2019 doubling in 2020

Bitcoin is capable of adding to its 2019 price appreciation of about 100% in 2020. A primary takeaway from our crypto-assets scoreboard is the outperformance of the first-born crypto vs. most others and compared with the Bloomberg Galaxy Crypto Index, up only about 20% this year. The process of Bitcoin differentiating itself as a scarce digital version of gold will continue, in our view. Bitcoin should stay at the forefront of adoption, while most others battle among the over 4,000 crypto assets listed on Coinmarketcap.com. Bitcoin supply is limited at 21 million; only about 17% more will be created.

In 2019 alone, the number of tradable crypto assets has more than doubled.

Love it or hate it, tether boosts Bitcoin as crypto standard

There’s little to dislodge Bitcoin and Tether as the crypto-asset leaders, in our opinion, with related market implications. The mass adoption of the Tether stable coin has negative ramifications for most crypto assets masquerading as currencies, and positive implications for a solitary digital equivalent of gold — Bitcoin.

Bitcoin ending 2019 near $6,500 support tilts favorably for 2020

Our Bitcoin technical and on-chain analysis shows the price on sound footings for 2020. The primary gauges from Coinmetrics — transaction totals and active addresses used — indicate the Dec. 3 price near $7,300 is low. Steeper declines would be entering oversold territory, based on historical comparisons. Bitcoin has revisited its upward-sloping 52-week mean after stretching more than 100% above this level in June. It was the most overbought since the 2017 price surge.

Bitcoin’s most widely traded price is about $6,500 — the peak of the bell curve — since the consolidation period starting in June 2018. Sprinting above this level signaled an end to the bear market, and revisiting it portends an extended range-bound slog before a sustained bull market returns.

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 8,254.62.

The projected upper bound is: 8,019.51.

The projected lower bound is: 6,372.71.

The projected closing price is: 7,196.11.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 18 white candles and 32 black candles for a net of 14 black candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 24.7654. This is not an overbought or oversold reading. The last signal was a sell 4 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 35.22. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 8 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -61. This is not a topping or bottoming area. The last signal was a buy 9 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 6 period(s) ago.

Rex Takasugi – TD Profile

FOREX BTC= closed up 32.010 at 7,211.680. Volume was 97% below average (consolidating) and Bollinger Bands were 11% narrower than normal.

Open     High      Low     Close     Volume___
7,179.6807,261.4007,066.0307,211.680 2,278
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 7,388.57 8,295.19 9,393.10
Volatility: 45 64 75
Volume: 84,968 78,375 85,532

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX BTC= is currently 23.2% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of BTC= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on BTC= and have had this outlook for the last 21 periods.

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