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August 28, 2018

IronFX, Cryptocurrency Market Outlook - Is Bitcoin in for a Bull Run?

Bitcoin was in a strong upward trend today in the Asian session which the instrument appreciated by approximately $220.

This article is originally referred from IronFX News.

Companies associated with Cryptocurrency mining, are openly confirming that their revenues are well below the initial expectations and demand is similarly diminishing.

Analysts are considering the fast drop in the digital coins value as the main reason for the reduced demand, which eventually turned investor attention away.

Here, a comparison could be made between other financial instruments in order to support our opinion of disagreeing with the general public, losing its confidence in coins.

In 2011 the most precious and acceptable metal, Gold reached a high of $1,900 and even surpassed that price.

From that year then after, Gold has gradually lost most of it value and while having some upswing has not been able to climb so high.

Gold is currently trading around $1,200, and even after the strong depreciation it has gone through in the past years, it’s still considered as a safe haven and one of the most liquid financial assets.

So we dismiss the general public views and statistical data regarding the crypto coins future development and in antithesis we support our view that these innovative instruments are here to stay, even under huge pressure.

Despite the fact that crypto companies have reduced revenues, some of the world’s largest bitcoin mining equipment manufacturers intend to bust a move with initial public offerings in Hong Kong.

Namely, Canaan Inc and Ebang International Holdings are planning moves in Hong Kong by the next May and June respectively, while Bitmain is probable to release its plans next month for an IPO in which it targets to raise at least $3 billion, according to Reuters.

Canaan and Ebang are considered as highly developed firms in technology to be applied to other cutting-edge sectors.

They offer innovative blockchain applications which are currently being explored by financial institutions as well as artificial intelligence tools and the upcoming build-out of 5G telecoms networks both within and outside China.

On other news the U.S. Securities and Exchange Commission said it would review its prior decision to disqualify nine bitcoin-based exchange-traded funds from actively trading in the market.

Furthermore, in the previous days SEC maintained its stance rejecting applications for new funds from three companies, amid concerns on fraud and manipulation.

Another important fact on the same matter, is the case of SEC commissioner Hester Peirce who chose to disagree with the rest of the commissioner’s decision not to give license to bitcoin-based exchange-traded funds.

According to her sayings SEC applied their review incorrectly as the product is being used and tested by the public and she also felt doing so, blocked innovation.

From Asia, more specifically the Chinese government, is on a mission to prevent more than 120 offshore cryptocurrency exchanges from further operations in the mainland.

The Chinese government is pulling the hand brake on these firms and is aiming for an industry crackdown on activities related to digital money.

Chinese authorities will continue to monitor and close down domestic websites promoting crypto activities and initial coin offerings and further banning payments services from accepting crypto coins, including Bitcoin.

As a conclusion, from the above analysis we understand that week by week the world is moving closer to Crypto coins acceptance as a trading instrument and as a measure of payment.

While, it is under huge pursue and criticism in China, we believe with protection measures, all the clouds over the subject could disappear.

BTC/USD 1 Hour Chart

Bitcoin was in a strong upward trend today in the Asian session which the instrument appreciated by approximately $220.

The upward momentum seems to persist however it could also be a sign of stabilizing at higher levels.

On a broader view, BTC/USD has been on a steady rise since the 23rd of August, last week.

The RSI indicator in the 1 hour chart is over 70 but seemingly dropping implying and overcrowded long market could be ready to correct.

If the cryptocurrency continues to trade with a bullish sentiment we could see it breaking the $7,000 (R1) resistance level.

If that resistance level is broken the digital currency could move even higher and aim for the $7,240.06 (R2) resistance barrier.

On the other hand, should the digital currency drop lower, it could break the $6,708.49 (S1) support level aiming lower for the $6,431.57 (S2) support hurdle.

Original Source: IronFX News

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