Bitcoin Price Watch; Here’s Where We Are Looking This Evening

We are closing in on the end of another session out of Europe on Thursday and once again there’s plenty to discuss in the bitcoin price. Things have been pretty volatile this week so far (well, pretty volatile is something of an understatement) and we’re currently looking at a substantially weakened price as compares to the prices we were looking at towards the end of last year and into the early part of 2018.

With that said, however, most of the major tokens and coins have gained strength during today’s session, with sentiment easing somewhat heading into the US afternoon. The hope is that this shift to positive sentiment will continue and, in turn, will serve up a continued recovery across the major assets in the space – of which bitcoin, of course, is very much the flagship right now.

So that’s what’s happening behind the scenes – what’s on the horizon nearer term?

Well, that’s what we’re here to figure out.

As ever, take a look at the chart below before we get into the nitty-gritty of our intraday analysis. The chart is a one-minute candlestick chart and it’s got our primary range overlaid in green.

As the chart shows, then, the range we are looking at for the session this evening comes in as defined by support to the downside at 11579 and resistance to 11809. That’s a pretty wide range but we’re going to stick with our breakout strategy for today, just to make sure we aren’t taking on too much risk with careless intrarange entries.

So, if we see price close above resistance, we’ll jump in long towards a target of 12000 flat. Conversely, if we get a close below support, we’ll be in short towards a downside target of 11480.

Let’s see how things play out and we’ll revisit on Friday morning.

Charts courtesy of Trading View

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Over the years, we have seen multiple stories regarding people scamming Bitcoin holders. It is a very worrisome trend which only grows more popular, it seems. More specifically, a group of fake Interpol agents scammed Russian tourists out of their Bitcoin holdings. A total amount of 4 million Baht worth of BTC was taken from them. It is not the first nor the last time such incidents will occur. An official investigation is underway to hopefully retrieve the stolen money.

According to Thai Visa, the incident took place in Muang District. More specifically, a Russian couple found themselves face to face with two Russian men. At that time, the men identified themselves as Interpol agents. They immediately claimed the couple was involved in some irregular Bitcoin activity. No evidence of these claims was ever provided during the incident. That is not surprising, as it is clear these individuals were looking to scam the Bitcoin holders regardless.

Fake Interpol Agents Want Your Bitcoins

By taking the couple by force, the tone was set rather quickly. A third Russian man entered the room shortly afterward. His demand is simple: the password for the netbook computer. Additionally, he obtained the Bitcoin account password. It is unclear if this applies to an exchange or a desktop wallet. For now, the details regarding that particular aspect remain rather vague. Either way, the account held a total of 100,000 Euro worth of Bitcoin.

The couple was scared and eventually gave in. Facing a threat of being drugged and handed to the Thai police is not all that appealing. It took a total of five hours before the fake Interpol agents got what they wanted. Thankfully, no physical harm is done to the couple, although they are still pretty shaken up. After contacting the Thai police, we now have to await what the investigation turns up. Bitcoin transactions are rather easy to trace due to the transparent nature of its blockchain.

So far, it seems the fake Interpol agents have fled to Malaysia. This seems to confirm the Thai police knows all too well what is going on or who is behind this theft. Assuming that is the case, it should be easy to rectify the situation. Whether or not the Russian couple will get their money back, seems highly unlikely. It is evident cryptocurrencies will continue to attract criminals all over the world. This is a rather problematic development, but there’s little one can do about it. Criminals have become very bold in their attempt to steal BTC, though.

It’s Thursday morning and it’s time to get moving on our twice daily bitcoin price analysis for the start of the European session. Things have been moving pretty fast throughout the session and, as many reading will almost certainly be aware, price is down pretty much across the board in the crypto space on the back of a couple of key fundamental developments. Well, the fundamental developments got things moving and this led to a whole host of collateral selling, primarily rooted in idea that people are unloading positions in anticipation of things falling further.

When we see this sort of action in the bitcoin price (and indeed in the wider cryptocurrency space), all that we can really do (from a long-term perspective) is to hold on to coins in anticipation of a return to the overarching upside momentum. Things could fall further but selling out at these levels is only going to compound the recent action and weaken the market.

From an intraday perspective, however, there’s no directional bias. We can jump in long if things start to strengthen but we won’t hesitate to get in short if things break to the downside.

So, with all this in place, let’s get some levels that we can use for the session. As ever, take a quick look at the chart below to get an idea where things stand before we get started. It’s a one-minute candlestick chart and it’s got our primary range overlaid in green.

As the chart shows, then, the range we are looking at for the session today comes in as defined by support to the downside at 11439 and resistance to the upside at 11637.

We’ll get into a long trade on a close above resistance, with a target of 11750. Conversely, a close below support will have us in short towards a downside target of 11325.

Let’s see what happens.

Charts courtesy of Trading View

With the overall market capitalization of cryptocurrencies gradually trending towards $1 trillion, increasing from just under $20 billion at the start of 2017 to over $700 billion at the beginning of the current year, it’s simply a good time to invest in the revolutionary technology called blockchain. Last year alone, bitcoin, the pioneer cryptocurrency, which introduced the blockchain technology too, rose from the $1000 region at the beginning of the year to over $19,000 at a point during the year.

Over the past month, or so, cryptocurrencies including ethereum, litecoin and ripple have enjoyed impressive rallies too. With governments and financial institutions around the world exploring the possibilities of issuing some form of cryptocurrency to benefit from the improved efficiency that blockchain powered money brings to the digital world, it’s safe to say that cryptocurrencies are here for the long haul and they’re likely to change the way we use money. The case for investing in blockchain and cryptocurrencies has never been stronger. The problem, however, is that the cryptocurrency market is plagued with instability and many useless coins, making it difficult for long-term investors to find a good entry points. Moreover, at present, partly because it’s still early days, it’s currently difficult to determine what a fair value is for cryptocurrencies. So this leaves the question of how to, genuinely, benefit from the blockchain and cryptocurrency revolution over the long term.

One effective way is to invest in cryptocurrency mining, the process that generates new cryptocurrencies. Many of the major cryptocurrencies including bitcoin, ethereum and litecoin depend on mining to function.

What miners do and why they’re important

Mining cryptocurrencies simply has to do with the process of verifying cryptocurrency transactions and adding them to the public ledger. Recall that crypto transactions are peer-to-peer, which means there are no intermediaries. In order to maintain the integrity of the system and avoid double spending, which had been one of the things that the traditional banks do, miners serve as witnesses to transactions. To verify transactions, miners use a computer or group of computers to solve a mathematical puzzle, called cryptographic function and they are rewarded with freshly generated cryptocurrency – the part that’s actually the mining. Miners can either sell the cryptocurrency rewards for fiat money on exchanges or keep them as an investment to bet on an increase in the value of the cryptocurrency. Just to point it out, it’s the process of mining described here that leads to an increase in the number of cryptocurrencies in circulation.

Is cryptocurrency mining profitable?

In a similar fashion to the saying that “not all cryptocurrencies are created equal,” all cryptocurrencies aren’t equally profitable. Cryptocurrency mining is designed to increase in difficulty as the number of miners of a particular cryptocurrency increases and the number that cryptocurrency in circulation increases. Consequentially, the cost of mining a cryptocurrency tends to increase as the usage of that cryptocurrency increases. So there’s simply no one formula to determine if cryptocurrency mining is profitable on an overall basis. Like all businesses, it would depend on the set up — like how much computational power is allocated to the mining of the cryptocurrencies of interest and the energy tariffs at the mining site. On a general basis, setting up a mining operation that is profitable depends on the ability of the owners to identify areas where energy costs are relatively lower and the cryptocurrencies that offer lower costs on a relative basis so they can assign them more computing power just to optimize operations.

Specific cryptocurrencies like bitcoin and ethereum have been said to be profitable for miners. For instance, bitcoin miners in China reportedly break even at $6,925 per bitcoin when energy cost in China is at its highest, according to Bloomberg New Energy Finance. With bitcoin hovering around the $14,000 mark, this means that bitcoin miners in China potentially making about 100 percent profit.

In addition, a calculation on the website Ethereumin suggests that, with a Geass ASIC setup, which cost about $2,289 with the capability to provide 200 MH/s (mega hashes per second) in hash rate, your profit could be 18.215 ETH in a year. With this sort of profit margin, it’s safe to say that a properly set up mining business should be profitable over the long haul.

How to Invest In Cryptocurrency Mining

There are mainly two ways to invest in the cryptocurrency mining business. You can setup either your own mining operation or investing in a mining business. If you have the technical expertise and time to start your own mining rig, as it’s commonly called, it could be profitable. However, for most people, the best option would be to invest in a mining business and one of the easiest options is to buy tokens during the ICO of a cryptocurrency mining company.

MoonLite is one of such companies. The MoonLite project is an industrial scale cryptocurrency mining operation focusing on the mining of all forms of bitcoin, litecoin and dash.

Cryptocurrency mining operations have been under pressure in recent times for the amount of energy they consume. In fact, Power Compare, a U.K. energy tariffs comparison platform cited Digiconomist, a cryptocurrency power usage tracking website, to suggest that bitcoin mining operations now account for approximately 0.13 percent of the total global electricity consumption. Going by that number, if bitcoin miners were a country, they would be the 61st largest consumer of electricity in the world. While some researchers have argued that Digiconomist’s data has a few layers of error in it, there’s no denying that bitcoin mining consumes a considerable amount of energy — just like any set up of computers doing high-level computation.

These consumption issues have started making governments around the world look into crypto mining operations. In the end, only cryptocurrency mining projects built to be efficient in terms of energy would win. That’s one thing to like about the Moonlite project.

Moonlite is building its first datacenter in Iceland, which is the unofficial capital of the world datacenter due to its inherent need for more heat energy that datacenters could offer. Moonlite datacenter will be running at roughly 14.6MW with 100 percent of the power coming from green sources. The mining company has been able to lock down a 12-year fixed and guaranteed energy cost with the Icelandic Power Producer at a huge discount to the local energy cost. It’s worthy to note that Iceland already has one of the cheapest energy tariffs in the world.

MoonLite plans to start its ICO on February 28 although it’s currently offering a presale, which will end before the start of the main ICO. Another unique thing about the MoonLite ICO, unlike many ICOs, is that the MoonLite tokens confer voting rights on all of the company’s financial, HR and branding affairs through Secure.Vote. That offers an extra layer of security and transparency that’s often missing in the ICO market.

To bring it all together, in world that’s filled with over a thousand cryptocurrencies from which one is to decide which ones are worth an investment, it might help to look in the direction of companies like MoonLite who help bring cryptocurrencies to the market.

Getting more businesses to accept cryptocurrency is anything but easy. Price volatility, high transaction fees, and slow confirmations are all holding Bitcoin back right now. According to Mark Cuban, things will change for the better very soon. More specifically, Cuban is also the owner of the Dallas Mavericks sports franchise. He told Twitter the team will start accepting Bitcoin payments next season. An intriguing development which leads to plenty of speculation.

It would be a major feather in the cap if another NBA team started accepting Bitcoin. More specifically, Mark Cuban claims that will be the case as far as the Dallas Mavericks are concerned. It will seemingly apply to game tickets, but there has not been any official confirmation as to how this will play out. Cuban told Bloomberg Bitcoin will not be the only cryptocurrency payment option. That in itself is interesting but also more than warranted. Bitcoin is not in the best of places right now. Some other currencies make a far stronger use case than BTC right now.

Mark Cuban Makes Some Major Promises

According to Mark Cuban, Ether will be a second cryptocurrency payment option. The choice for Ethereum’s native token is rather interesting. Similar to Bitcoin, Ethereum struggles with network congestion on occasion. Moreover, its network fees are also higher than they should be, albeit much lower than Bitcoin’s. Adding these two currencies would be an interesting start, to say the least. Moreover, the Dallas Mavericks might accept tokens as well. This will only apply to tokens issued by companies the team has business relationships with.

It is uncanny how Mark Cuban did a complete 180 on cryptocurrencies. Six months ago, he claimed bitcoin was in a bubble waiting to burst. At the end of 2017, he finally decided to invest in cryptocurrency. He’s also involved in a digital token and a blockchain fund. It is evident Cuban has finally seen the light, although things can always change in a heartbeat. After all, the cryptocurrency markets are currently in a state of mass panic.

For now, all of these proxies need to be taken with a grain of salt. Business people will gladly say one thing and do the complete opposite in the end. The Dallas Mavericks are a major sports franchise. Associating with cryptocurrencies can be both beneficial and a major risk at the same time. Rest assured there is still a lot of work to be done before these promises become a reality. In fact, it may never happen, for all we know. Mark Cuban certainly is an intriguing figure, but nothing he says should be taken at face value.

Companies and their investors who have jumped on the cryptocurrency and blockchain bandwagon are discovering the other side of aligning their image to digital currency. During the bullish 2017 market, firms who announced support for Bitcoin, or included blockchain in their branding or business models, experienced sharp rises in their stock price. However, following the news that a crypto clampdown might be soon underway in Asia, the fear and uncertainty surrounding the markets of Bitcoin and its close cousins has spread to traditional stocks associated with the emerging asset class.

Payment processing company Square integrated Bitcoin buying and selling functionality to their app late last year. Following the news, the price of their shares immediately shot up. However on Tuesday, as the price of Bitcoin plummeted to around $10,000, Twitter CEO Jack Dorsey’s company also lost $90 million in market value. Square ended regular trading with a valuation of $15.1 billion. This equates to a loss of around 5%.

Meanwhile, e-commerce company Overstock suffered a similar fate. They’ve been long time proponents of cryptocurrencies and were one of the earliest big names to allow their customers to pay in them. Following the sizeable correction experienced this week, the price of their stock fell 11%. They ended the trading day with a loss of around $200 million. This put their market capitalisation at $1.8 billion.

However, it’s not just these larger names that have been affected by the downturn in the price of cryptocurrencies. Examples like Riot Blockchain (formerly Bioptix), a once-biotech company who recently moved into the crypto space lost 17% of their market cap. Meanwhile Eastman Kodak, the camera manufacturing giant, recently announced that they would offer their own cryptocurrency known as Kodakcoin. The news sent their stock price soaring 60% on the day it was announced. However, yesterday they too suffered 8% losses.

Typically, the South Korean and Chinese cryptocurrency markets have been some of the planet’s largest. It’s therefore not surprising that fear of government hostility towards digital currencies there would create such a downturn across almost all blockchain-based coins. No doubt that cryptocurrency naysayers around the globe will be busy penning yet more Bitcoin obituaries to add to the ever-growing list of times that Bitcoin “died”.

Soldiers in South Korea will no longer be able to access online cryptocurrency trading websites whilst at military bases. A notification issued Monday by the Ministry of Defence outlined plans to crackdown on digital currency trading. They also began shutting down access to websites about Bitcoin and other virtual currencies at the same time. The notification read:

“According to internal rules, we will gradually shut down internet access to websites on encrypted currency starting Monday.”

The measure is in line with other prohibited material on military bases. This includes pornography and online gambling websites. The Korea Times report that a further crackdown on soldiers using cryptocurrency might be incoming. According to a ministry official:

“We are going to announce specific countermeasures for cryptocurrency transactions made in military units… The ministry is in internal talks to confirm whether it is against military regulations.”

The unnamed source reportedly continued to suggest that the tightening of regulations aimed to protect soldiers’ morale against the potential ill-effects of a market as volatile as cryptocurrency.

As of yet, it’s unclear what additional preventative measures the Ministry of Defence will take against those using cryptocurrrency. However, since Monday access to websites about cryptocurrency and exchange pages have been blocked at internet cafes on military bases.

An online notice posted Monday by the military also said:

“According to internal rules, we will gradually shut down internet access to websites on encrypted currency starting Monday… We urge soldiers to refrain from visiting digital token exchanges to avoid disappointment from our decision to block access to relevant sites.”

In addition to the Ministry of Defence getting tough on cryptocurrency, they have also announced that they will offer troops classes on financial education. This is because it is difficult to access such information whilst staying on a base. However, just how free from bias these classes are remains to be seen. It seems likely that any anti-cryptocurrency sentiment running through the government will trickle down to their soldiers’ education.

The news about the military crackdown on Bitcoin and other cryptos comes amid heightened regulatory fear from South Korea. The government there have been posturing about changing legislation regarding digital currencies. It’s unclear how they will go about this at present. Finance Minister Dong-yeon said on Monday that the government were considering whether to shut down domestic crypto exchanges. According to the government minister:

“The thing is the scope of reasonable regulation, but there is no global standard on it… We are coming up with comprehensive regulatory packages, including taxation or real-name-based trading on digital tokens.”

Indonesia’s Central Bank, Bank Indonesia (BI), have united with the national police service to tackle the illegal use of Bitcoin in Bali. According to them, the tourist hot spot is much more likely to attract people trying to use the cryptocurrency for transactions that are outside the law. The Jakarta Post and local language news source Tempo.co report that on Saturday, January 13, a senior member from BI, Causa Iman Karana, announced the clampdown in Dempasar, the capital of the romantic island getaway location:

“We are looking out for bitcoin transactions in Bali, particularly in tourist spots. We will take measures against non-rupiah transactions.”

Karana also called on the people of Bali to not accept transactions using digital money. For the banker, it is the lack of central authority regulating transactions that is a primary cause for concern. Like most central bankers, the fear of their own pending redundancy was also a likely motivating factor behind his words.

This recent  crackdown in Bali is part of a wider initiative against the use of cryptocurrency in the nation of Indonesia. According to national legislators, making transactions in Bitcoin violates Law No. 7/2011 on currency. This recent reiteration underlines the initiative penned at the bank late last year. In early December, Bank Indonesia issued BI Regulation No. PBI: 19/12/PBI/2017. This expressly banned the use of digital currency in Indonesia and stated that all transactions and payments must be made using the national currency, the rupiah. A spokesperson for the bank, Agusman, at the time spoke of the risks posed to those getting involved in the digital currency space. Like Karana, he too deemed the primary issue with virtual money transactions the lack of centralised control:

“We warned people not to carry out transactions with virtual money because there is no authority that regulates the transactions.”

The bank spokesperson went on to highlight the speculative risk of using Bitcoin and other cryptocurrencies. Also amongst his concerns were the dangerous posed to the state because of money laundering, as well as the ease with which virtual currencies could be used to finance terrorism. Agusman concluded with a straight forward message for the people of his country:

Therefore, [BI] wants all parties not to sell, buy or trade the virtual currency.

Indonesia isn’t the first and it certainly won’t be the last country who attempts to stamp out the use of virtual currencies by force. Across the globe, Bolivia, Algeria, Ecuador, and Nepal are amongst those nations that have issued an outright ban on the use and trading of digital currencies. However, such small economies are incapable of moving the price of BTC or any other currency in any dramatic fashion. If the global popularity of crypto continues to grow, it’s likely that these States will be forced to liberalise their knee-jerk legislation or else get left further behind the planet’s larger economies.

 

One of the latest pop groups to emerge out of Japan are the trend-riding Kasotsuka Shojo. The name translates to Virtual Currency Girls and in typical J-Pop style, each of the eight members wear a different costume representing one of the largest cryptocurrencies. Amongst the performers are Bitcoin, Bitcoin Cash, NEM, and Ethereum.

The all-girl band are seeking to educate the public about digital currencies from a wider angle than simply pure speculation. This is evidenced by their first song, “The Moon and Virtual Currencies and Me” and another tune which includes the lyrics, “Don’t forget about two-step verification,” and “Never use the same password twice”.

Kasotsuka Shojo were created by the Japanese girl band factory that is the Cinderella Academy. The entertainment company also manages several other popular groups.

The crypto-themed band played their first show in Tokyo last Friday. It was an action-packed thirty minutes in which the eight-piece explained the benefits of using electronic currencies, as well as the present security risks faced by those in the space. During the performance, various dramas from the digital currency space were acted out on stage. In one such vignette, the girls representing Bitcoin and Bitcoin Cash had a scrap over Hinano Shirahama’s (BTC) assumed leadership of the cryptocurrency world. BCH’s representative, Rara Naruse, declared:

“The surge of Bitcoin caused various problems. To solve these, Bitcoin Cash was established, with smaller fees and quicker transactions. So I think Bitcoin Cash will replace Bitcoin at some point in the future. The market cap of Bitcoin Cash will be number one!”

It should come as little surprise that the world’s first cryptocurrency-themed pop group hails from Japan. Besides the nation’s love of music that often seems quirky but is sometimes downright bizarre to us in the West, Japan are also trend-setters in the treatment of Bitcoin as legal tender there. At one stage, the island State accounted for the largest share of global Bitcoin trading and their Tokyo-based BitFlyer exchange platform continues to be one of the planet’s largest. Quartz report the research of Japanese finance company Nomura. They state that thanks to the sharp rise in the price of Bitcoin over the last twelve months, combined with Japan’s embrace of the technology, has helped their GDP to the tune of 0.3%.

 

Image: PixaBay

 

We are closing in on the end of the European session in the bitcoin space on Friday and the end of the week is fast approaching. This has been something of a rough week for many bitcoin traders and holders, with price maintaining a pretty substantial downside trend throughout the majority of the major sessions and only temporarily recovering from said trend on the odd occasion.

As far as executing on our intraday strategy is concerned, however, things haven’t been too bad.

All we really look for is volatility and so it doesn’t really matter that price had been declining so long as the decline brings with it breaks of key levels and subsequent sustained momentum beyond the initial break.

As we move into the session this evening, then, that’s exactly what is on our wish list. We want sustained momentum, volatility, and, only as a final addition to the list, some degree of upside reevaluation heading into the weekend.

So, with all that said, let’s get some levels in place that we can use to take advantage of this type of action as and when it plays out. As ever, take a quick look at the chart below before we get started so as to get an idea where things stand and where we are looking to jump in and out of the markets when we get the signals we are looking for.

The chart is a one-minute candlestick chart and it has our primary range overlaid in green.

As illustrated, the range we are using for tonight’s session is defined by support to the downside at 13768 and resistance to the upside at 13895.

If we see price close above resistance, we will enter long towards 14000. Conversely, a close below support will signal a short entry towards a downside target of 13250.

Charts courtesy of Trading View