Mati Greenspan, Senior Market Analyst at FX broker eToro, has provided his daily commentary on traditional and crypto markets for June 27, 2019. The text below is an excerpt and does not contain the full analysis.
Hi Everyone,
The crypto market has been anticipating the participation of large financial players ever since the peak of the last massive rally in 2017. While this dream has not yet been actualized, there are clear signs that it’s getting closer.
Mark Zuckerberg first announced his blockchain intentions in a post dated January 4th, 2018. So to have come out with a full white paper now is definitely progress.
Similarly, the Bakkt platform was first announced on August 3rd, 2018 and had an initial launch date scheduled for last November. After some wrangling with local regulators, they are now confident that they’ll be able to open testing by July 22nd.
On Tuesday, it seems that one firm in the USA made some incredible headway with the local regulators.
With Fidelity Investments, which currently has $6.7 trillion of client assets, already onboarding its first few clients into crypto, institutional players are now at our doorstep.
Today’s Highlights
- Bitcoin Crashes, Recovers: In less than an hour yesterday, the crypto market crashed about 15% in less than an hour. Multiple trading platforms went down momentarily, which helped stop the crash. The price quickly retracted back to the highs of the previous trading day.
- High Stakes for Trump and Xi Trade Talks: The meeting is set for 11:30 AM on Saturday morning. It’s a bit difficult to gauge where this meeting will go at this point; however, Trump has already vowed that if it does not go well, he’ll be putting billions and billions more tariffs on China.
- Not Much Technical Support Behind Bull Run: Messari’s ‘real 10’ bitcoin volume is at $5.5 billion, but the steep nature of BTC’s recent climb has prevented any solid technical support from building.
Please note: All data, figures & graphs are valid as of June 27th. All trading carries risk. Only risk capital you can afford to lose.
Traditional Markets
The meeting is set. At 11:30 AM on Saturday morning in Osaka Japan President’s Trump and Xi will have a landmark meeting. What we can expect is anyone’s guess.
Trump has already vowed that if it does not go well, he’ll be putting billions and billions more tariffs on China. So, no pressure.
Pundit vary in their opinions about the outcome of the meeting, from ‘no deal whatsoever’ to ‘a groundbreaking deal will be struck’ so it’s a bit difficult to gauge where this will go. All we know is that if you do want to have a position on the market, you’ll need to get it in tomorrow.
Stocks are doing pretty well today overall. The Asian session was fantastic but it seems the opening in Europe was a bit soft. US futures are holding.
Bitcoin DownTime
It seems the crypto market got a bit too hot yesterday and is now cooling down. What an incredible market where the price can crash about 15% in less than an hour and bring us back to the highs of the previous trading day.
The price crash coincidentally coincided with the downtime of the popular exchange Coinbase. Here we can see the approximate time of the outage in purple.
So in fact, it was not Coinbase that caused the crash but rather the opposite. The running theory is that its website buckled under the weight of traffic caused by the sudden price drop.
Trading app Robinhood also reportedly halted bitcoin trading around the same time.
Welcome to summer!!
It’s also worth noting that Bitfinex was down as well during this time for scheduled maintenance, which could have contributed to the fall. The platform handles a lot of orders so no doubt the market was missing the liquidity.
Record Volumes
In any case, we’re now seeing record high trading volumes across the board. This morning, I spotted Messari’s ‘real 10’ bitcoin volume at $5.5 billion, which is the highest I’ve ever seen it.
OTC desks are also reporting record high volumes. Some of them are even eclipsing anything they’d seen previously.
Of course, with this pullback in place, it pays to look at the chart. The most aggressive possible trendline (white) has been broken now.
The nature of the climb as such prevents us really from getting a solid support footing. However, the yellow line here represents my best attempt at drawing the trend. It certainly wouldn’t surprise me to even see it below this line again.
The key psychological level of $10,000 has also not been tested as a support, so there’s also that. Of course, if we do continue up from here it would be pretty crazy and certainly would be a testament to the fact that we might actually be in for a much larger bull run.
Have an awesome day ahead!
Mati Greenspan can be found on LinkedIn, Twitter, or etoro.
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