Scaling Bitcoin Payments (FREE)

Week 38: September 18, 2019

Every week we review BTC price drivers from last week and perform both sentiment and technical analysis to help forecast the future.

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Week 38: September 11, 2019 - September 18, 2019

Bitcoin price this past week has drastically underperformed many altcoin including Ethereum (18%), Litecoin (11.18%) and EOS (9.47%). While Bitcoin has underperformed this week there have been several positive sentiment drivers so we issue a HOLD this week because:

Rating: HOLD

BTC Market Cap: $17.94B

BTC Price: 0.2% ($10,178.37 to $10,198.54)

BTC Active Addresses: -3.5% (807.98k to 779.63k)

BTC On-chain Transactions: 3.1% (338.91k to 349.43k)

Technical & Sentiment:

  • Bitcoin price is trending in a tightening range, wait for the breakout before entering

  • Sentiment continues to trend lower, similar to the action seen prior to the recent ETH breakout

Positive Price Drivers:

  • Developments in Layer 2 scaling solutions are bringing the necessary throughput to carry Bitcoins projected demand

  • By demand the CME is set to double the trading limit of Bitcoin Futures

Negative Price Drivers:

  • Bitcoin dominance is declining as altcoin pumps, a change of trend from the past 4 months where Bitcoin has been King

  • Bitcoin returns appear to be correlated to the S&P 500 and the returns this year may not be favorable

BTC Price Analysis:

On a macro level:

IF this happens, then we buy:

  • Bitcoin price correlation to Gold increases as the fear index increases

  • Global Central banks drive interest rates negative putting the global economy on edge

IF this happens, then we sell:

  • The US stock market declines with a high correlation to speculative safe haven assets like Gold and Bitcoin

  • Craig Wright signs the genesis block with real keys proving he is Satoshi Nakamoto

BTC Sentiment:

Price Drivers This Week:

A Faster Payment Method

Layer 1, the core protocol layer for Bitcoin transactions is old and slow. Developers have been working on Layer 2 scaling solutions built off-chain to make Bitcoin payments faster and cheaper, making global adoption easier. Most notably, the popular Cash App by Square will soon use Lightning protocol on Layer 2.

SegWit Spending Tops 50%


We now have proof that the mining reward from Segregated Witness (Segwit) actually makes up over 50% of all the payments made on the Bitcoin blockchain. Even the most optimistic Bitcoin miner realizes that it means almost $50 million is being wasted by miners every month. This is about a 30% revenue loss for the core developers which is a big deal. It also shows that these miners aren't happy because they have been trying to make Bitcoin profitable for over 18 months since the first Segwit activation.

This also means it is actually more profitable for core developers now since they are getting almost 2/3 of the coins that miners get for their hard work mining. Segregated Witness miners are just getting a little bit less than half of the entire mining reward, even though they put all their energy into a fork to fix a bug. The activation on segwit enables faster transactions by removing mathematical rules from the Bitcoin core protocol which some developers believe weaken the security of the network.

2017 SegWit is Old News…

Additional scaling solutions for the Bitcoin network beyond the 2017 SegWit activation is the launch of the lightning network. Currently, there are 9,867 nodes and 36,250 channels sustaining the network, channeling a total of 828.71 BTC across the world. SparkSwap has just launched a non-custodial bitcoin exchange on top of this network which allows for near instant clearing and no on-chain congestion. The creation of new tools on top of this young network are leading to positive speculation around the future adoption of bitcoin.

Not Just Lightning Network Though

Similar to the Lightning Network, Blockstream has launched their own Layer 2 scaling service mostly used by institutions named, Liquid Exchange Network. Crypto Exchange Bull Bitcoin has joined with Blockstream to offer liquidity solutions. The Liquid Exchange Network is able to transfer traditionally private digital assets privately on dark pools. Many were concerned about their activation of Tether USDT on the Liquid Exchange as providing liquidity without transparency could disrupt the traditionally public ecosystem.

The Decline of Bitcoin Dominance

Bitcoin dominance has declined from as high as 74% to a current 68% within days. This decline has been attributed to the stagnant Bitcoin while altcoins have rallied. While some are hopeful that altcoin season may come back, this relief rally comes after 93% declines from all time highs. For many coins, it would require an extreme - likely historic market move to the upside.

CME Seeks To Double Monthly Bitcoin Futures Trading Limit To 10K BTC

Those Black Swan Events are back again…

Kraken Trades from $8,000 to $12,000 in seconds, with no orders in between filling.

Bitcoins Remarkable Correlation to US Markets

Reminder that Bitcoin is NOT fully anonymous!

Image result for crypto investigation tool

US Army Seeks Blockchain Experts Who Can Trace Bitcoin in Real-Time

What the top personalities on Twitter are saying:

That’s it for the BTC weekly report from September 11 - September 18, 2019.

Subscribe today with your first month FREE and come back tomorrow for our Industry Special Report.

Pushing the Crypto Adoption Curve

Week 37: Reviewing Last Week to Forecast Next Week

Every Monday we review pricing trends in BTC ETH and EOS, so we can improve our trading skills. So far, our recommendations are over 80% accurate and we’re getting better weekly, so good, in fact, we’re starting a fund (more on that later).

If you want to get our trading recommendations, and asset reports subscribe now and get your first month free.

We’re also beta testing our trading platform where users can trade with zero tx fee and better than exchange prices.

If you’re interested in becoming a beta user, fill out this form.

In this issue:

  • Crypto Twitter gets excited about the pushing the crypto adoption curve

  • Price Movements for BTC, ETH and EOS

  • Call for Beta Traders on Tradecipher

Trending Across Crypto

Here’s what people are talking about this Monday.

Overall Market Movements

Price movements across all three assets we cover are just as volatile as ever. Volatility represents a huge opportunity for traders, and here we evaluate the trades from last week.

Since hindsight is 20/20, we evaluated ‘perfect’ trade opportunities, if we called every asset correctly - which would have yielded us around 20.2% in profit with an average of 5 trades in a week!

Bitcoin Price Movements

Bitcoin price this past week was non directionally volatile, with price often returning back to a mean. The three opportunities this week were significantly less volatile than prior weeks, with no trend netting double digit gains.

The top of BTC trends continue to be derived from high volume candles with wicks at the top. The $10,488 doubled topped, and the second wick drastically sold off, a reminder of the power of the double top. The reversal off $9,814 could have been predicted by observing the large buying pressure creating by the large wick on high volume. The current bottom of the trend has irregular volume on the weekly, and could possibly indicate a near term bottom in trend.

If we were to perfectly trade the market we could have turned $100 into $119 in just one week with just six trades.

Ethereum Price Movements

Ethereum price movement this past week was highly directional to the upside. After price plunged into support, it rose drastically - a good observance for next time. Price tops and bottoms were identified with large wicks, and a high trading volume. The large movement to the upside may present the start of a reversal in Ethereum price trend as the past two months have been very negative.

If we were to perfectly trade the market we could have turned $100 into $120 in just one week with just four trades.

EOS Price Movements

EOS price this week dominated top altcoin leaderboards, leading the charge in gains for top altcoins. Tops and bottoms within EOS this past week were hard to spot. We have been using a range bound strategy that relies purely on price and not price action to determine directional movements. Notice the extreme dampening of volatility between the 12th leading into the breakout on the 14th, as price barely traded within a 2% daily range. This slowing of price change often leads to a major directional price movement, as seen with the rapid push to $4.10 (which we caught ahead of time).

If we were to perfectly trade the market we could have turned $100 into $123 in just one week with just four trades.

Call for Tradecipher Beta Traders

And—that’s it for Monday. If you want to learn more about our trading platform with 0 TX fees and Better Than Exchange pricing, please fill out the form below so we can learn more about you. It’s like an OTC desk, automated, with zero premiums. We want traders to

Be a Beta Trader

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You’ll get tomorrow’ BTC trade opportunity. Our trades have been averaging about 5% return, which means, you only need to trade a few hundred dollars to make back your $19/month return (or even less if you buy the annual!)

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