The Leading Cryptocurrency Stories for 24th Jan 2018

The Leading Cryptocurrency Stories for 24th Jan 2018
January 24, 2018

The cryptocurrency market is in the midst of a huge transition. On one side, companies continue to launch platforms that will create a sea of change in the way businesses function. On the other side, conservative governments and financial institutions try to clamp down the growth of blockchain technology. That has been the case with several disruptive technologies. Ultimately, technology prevails. While South Korea has made it clear that it will not stand in the way of cryptocurrency exchanges, it did make sure of getting a share of the revenue generated by the exchanges by imposing a 24.2% tax. Further, crypto exchanges are ordered to deal with real-account names. Notably, Korbit, a South Korean exchange, has announced that it will no longer accept international clients. Other cryptocurrency exchanges are expected to make a similar announcement soon. The central Bank of Indonesia, in the meanwhile, has started cracking down on Bitcoin users by joining hands with the police department. The efforts are currently concentrated on Bali, a tourist destination. In Europe, Mario Draghi, the ECB President is expected to have a conversation with the youth, aged between 16yrs and 35yrs, on a wide range of issues, including Bitcoin and other cryptocurrencies as well. The last date for raising queries through Twitter and Facebook ended yesterday. In particular, the developments related to Bitcoin and other major cryptocurrencies are as follows:

Bitcoin
The cryptocurrency began the week strongly by rising to a high of about $12,600. However, developments in South Asia sparked another round of sell off in the coin. The coin is now trading below the crucial level of 11,033. Notably, the transaction fees have dropped to about 220 Satoshis per bytes. A month before, when Bitcoin was trading at about $19,000, the transaction fee hit a high of about 1100 Satoshis per bytes (i.e., for a simple transaction of about 230 bytes, a user will use about $50 as miner fees). It is expected to go down further due to several reasons. Firstly, SegWit (Segregated Witness) technology, which was implemented in August 2017 is now taking effect. It enables faster and cheaper transaction. Even now, only 15%-20% of Bitcoin transactions are from SegWit addresses, which starts with 3. Secondly, BTC.com – a major miner – has integrated SegWit and also implemented a dynamic fee system. Thirdly, Lightning Network, which is expected to facilitate millions of transactions per second at negligible cost is being successfully tested. Experts believe that it will result in mass adoption of Bitcoin. All these factors continue to bring down the transaction fees. Read more here.

Ethereum
Bitflyer, a cryptocurrency exchange based out of Japan, is the world’s largest Bitcoin and Ethereum exchange. It has now received a PI (Payment Institution) license for the European Union. The firm already has a regulatory approval in the US. With the grant of license from the EU, the exchange will soon offer Ethereum and Bitcoin trading to investors in Europe. As of date, it is the only exchange in the Europe to have a PI license to buy and sell Bitcoins. Almost $10 billion worth Bitcoin and Ethereum are traded on Bitflyer’s platform every month. Therefore, the arrival of Bitflyer in Europe will enable investors to access the Japanese cryptocurrency market. The Canadian government in the meanwhile has announced its intention to use blockchain technology to improve transparency in the areas related to funding and grants. The National Research Council of Canada will conduct the trials through its Industrial Research Assistance Program (NRC-IRAP). The institution will develop a prototype using Catena Blockchain Suite, a suite of software services built on top of the Ethereum platform. Despite the good news, Ethereum is facing heavy resistance at around 1,000 levels. Read more here.

Ripple
All the major cryptocurrencies were on a downward spiral yesterday. However, Ripple was the prime target of short-sellers and speculators. The reason is that analysts are finding it difficult to clearly assess the value of Ripple network. While there is no denial that it is currently being tested by a consortium of 61 banks for cross-border fund transfer, there is yet to be a real world use case for the platform. The Ripple network is also currently tested by major credit card companies in Japan and also by MoneyGram. However, a clear valuation can be done only when a real-world use case comes in. Another concern for investors is that it is not a decentralized coin. Almost 55 billion coins are held by Ripple, the company which has developed the platform. Read more here.

Our Forex Trading Plan

Bitcoin. As mentioned earlier in this article, Bitcoin has fallen below the crucial level of 11,033. Thus, we feel that it is prudent to go short in the cryptocurrency. The stochastic oscillator is also in the bearish zone. Thus, we prefer to initiate a short position near 10,600, with a stop loss order above 11,600. On the downside, the next major support exists only at 6950. So, if the stop loss order is not taken, we will exit the short position near 8,000 levels.

BTCUSD - Technical Analysis - 24th January 2018

 

 

Our Binary Options Trading Plan

Ethereum. The cryptocurrency broke the major support level of 995 yesterday. On the downside, the next major support exists at 745. The RSI indicator has crossed below the zero level. Therefore, we are expecting the downtrend to continue.

A put option looks ideal under the current circumstances. We may trade the option as long as our binary broker offers a contract with expiry date on or around February 2nd. Additionally, the ETHUSD pair should be trading near $960.

ETHUSD - Technical Analysis - 24th January 2018

 

Disclaimer: The trading analysis offered here is our opinion. It is not provided as trading advice, merely an indication of our trading plan. We cannot guarantee success and we encourage traders to incorporate a strong money management strategy to limit losses. Please use this article as part of your own research before formulating strategies prior to trading.

Ian Maguire

Ian Maguire

Ian is our resident contributor to the latest going ons in the cryptomarket, keeping up to date with the latest icos and coins


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