Weekly Results: Bitcoin Swing Encourages Regulators to Actions

Over the past week (November 23 - 29), the bitcoin price fell by 1.54%, but during the week, we observed essential changes that affected most market participants.

Bitcoin capitalization has decreased by $2 billion and now amounts to $135 billion. Trading volume, compared with the beginning of the week, fell $5 billion, reaching $18 billion. However, it would be wrong if we did not say that at the time of the sharp movements of Bitcoin trading volume increased to $50 billion. But the dominance of bitcoin in the market has gradually increased and at the moment has reached 66.5%.

Over the past seven days, four significant movements have occurred immediately, which have greatly affected the market. The first of them happened in the week beginning, as a result of which Bitcoin fell from $7,600 to $7,000. Then we saw a sharp decline to $6,500 as a result of which volumes increased to their maximum value this week. However, the very next day, buyers were able to change the mood of the market and first returned Bitcoin to the mark of $7,000, and a day later, to $7,500.

As we can see, the week was eventful, and the volatility of bitcoin increased significantly. Therefore, we saw many liquidations that occurred on large exchanges. So, only at BitMEX, a total of $250 million worth of positions were liquidated in a week.

Despite such active actions on the market, the chart remained under the downtrend line formed more than a month ago. Globally, we went down to another downtrend. And this came as a surprise to most market participants, as they believed that Bitcoin broke it up and then retested. They can be understood, as it is considered one of the most reliable bullish patterns in traditional markets. But, once again, technical analysis without taking into account news and fundamental analysis were powerless.

At the moment, the chart has returned to the 0.23 Fibonacci level and fixed above it. It coincides with the level of $7,300 - $7,400, which every day is set either by the local support level or by the local resistance level.

Technical indicators suggest further growth, which will have a local form and eventually come to naught. It is due to the healthy bearish pattern that has arisen this week.

So, we finally saw that the younger moving averages (EMA20 and EMA50) crossed the older moving average (EMA200). Recall that for history, this event became a harbinger of a protracted bear market. The last time it was in June 2018, after which the price of bitcoin decreased until January 2019.

Faster indicators such as Stochastic and RSI have an upward structure. In the middle of the week, they turned around and headed up. Both are near the 50% level, which is a strong resistance. Given the structure of the reversal, both indicators should take this level and reach the oversold zone, which corresponds to the level of $8,000 for bitcoin. And this area is the most significant resistance on the chart at the moment. Therefore, upon reaching this level, the most visible event is a reversal down and a move below $7,000.

This week, a lot of news came from state authorities from various countries. So, it became known that China is conducting raids to identify illegal companies engaged in cryptocurrency. These include unlawful exchanges, assistance in conducting ICOs, and the provision of trading opportunities on foreign exchanges.

And on November 26, South Korea issued a bill that spells out the legal framework for the crypto industry. It will help increase transparency within the industry and make cryptocurrency companies strictly follow the laws of the country and have high transparency of their actions.

News about crypto regulation came from Ukraine. The President signed a decree according to which the illegal enrichment of officials through cryptocurrencies could lead to criminal punishment with a maximum term of up to 10 years in prison.

However, the most significant and negative news, except for the bitcoin fall, was the hacking of the largest Korean exchange Upbit. The attacker was able to remove 342,000 ETH from the site, which in terms of dollars is 50 million. Upbit temporarily closed inputs and outputs and promised to reimburse all user funds. The hacker transfers funds to the addresses of Binance and Huobi and in every way, tries to hide the movement of transactions.

How was the week for coins from the Top-10

The steady swing of Bitcoin negatively affected most of the coins from the Top-10. As a result, the average price change was -2.7%. However, this is better than last week, when this value was -7.1%. The only coin that could grow was Bitcoin SV, which traditionally has t is the inverse correlation to the market.

Binance Coin showed the most significant drop, which is a surprising fact because this week, Binance had several major events at once. So, the company announced the launch of a new project on Binance Launchpad, which became Troy - an online cryptocurrency broker. Also, in honor of Thanksgiving, Binance doubled referral rewards. These events did not contribute to the increase in the price of their coins.

XRP, which lost 6.9% in a week, came in second place in the fall. It happened even although, in the last allotment, the XRP team actively participated in conferences around the world and also opened a fintech laboratory in Singapore.

As we can see, almost all coins fell not only to the dollar but also to bitcoin, which once again confirms its dominant role.

By the end of last week, the dominance of bitcoin was declining and was below 66%. But now it has grown, although during the week we observed severe drops in the coin. All other cryptocurrencies from the Top-10 only reduced their market share. Due to this, the dominance of all other altcoins has increased significantly: from 10.1% to 11.18%.

How was the week for coins from the Top-100

In general, the week was neutral, because the ratio of rising and falling coins was approximately 50/50. At the same time, there are both sharp ups and very painful falls. The average rate of change in prices was positive and amounted to only 1.13%, which is a rather weak indicator.

Although, in general, the altcoin market felt good, it still succumbed strongly to bitcoin movements. So when they fell, they fell very hard and broke through the support levels that formed for weeks, but with the growth of bitcoin, their values ​​increased less. We can say that this week bitcoin set the direction for the altcoin market as well. But by the end of the week, everything had returned to its place.

This week showed that altcoins are highly dependent on the heading cryptocurrency; therefore, when drawing up a strategy for trading altcoins, it is always necessary to consider the possible movements of bitcoin so as not to reduce your deposit.

Growth leaders

As we can see, growth leaders have excellent results. So the average growth rate for them was 46%, which is a very high result. It allowed two coins to enter the Top-100 best cryptocurrencies at once and gain a foothold there - they were Matic and Enigma.

The growth leader, Matic Network, showed high results, an increase of 66%. And this was facilitated by several events. At the beginning of the week, they entered into a partnership with Monolith, and now their coin can be stored on a plastic card with 45 million users. Also, they entered into a partnership agreement with the new IEO at Binance - Troy. Also, the past week was full of conferences at which Matic participated, and two crypto exchanges listed their coins. The combination of these factors allowed us to show such high growth.

In second place is the Mindol project, which grew by 57%. Since December 2018, the project development has been postponed indefinitely as a result of which interest in it has faded. However, in mid-November, it was announced that the project was returning, and a new active phase of its development began. The community responded positively to this news, and as a result, we saw strong growth.

Fall leaders

Overall, the fall leaders did not lose too much in one week, except for Silverway. The average drop was 21.8%, which is slightly higher than the average.

The leader of the fall, Silverway, lost 41.5% of its value against the dollar. This project provides over-the-counter trading services for the cryptocurrency market. The price fell due to two consecutive trading competitions: first on the BitMart exchange, then on HitBTC. As a result, we first saw an increase in trading volume, which ended with even higher sales after the close of tenders. The artificial increase inactivity led to a drop in interest and token prices.

A similar situation occurred with the coin, which is located on the second line and lost 19.4%. It is a BitMax exchange token that conducted a cash drawer for the active use of BitMax Token. After the end of the competition, market participants began to massively get rid of the exchange token, which led to a substantial drop.

Crypto Industry at Google Trends

As you can see from the graph, the number of Bitcoin requests increased sharply at the moments of active movements of Bitcoin, which occurred at the beginning and middle of the week. And in periods of calm on the market, the popularity of requests decreased below 50%. A similar situation is with demanding word requests, and it’s just hard to see because of their popularity at a low level.

Conclusion

Total market capitalization decreased by $3 billion per week and is $203 billion at the time of writing. Trading volume fell 25% from the end of last week and is now at $63 billion. Although the market was in a significant fever up/down, the market continues to decline over the weekly period.

The activity on the cryptocurrency market was very high, and It was because of a substantial increase in volatility, which reached 15% per day. Sharp fallings replaced to equally great take-offs. But in general, it was Bitcoin, which this week was the main character, set the mood for the market.

After a long lull, the market began to pick up speed and increase the number of players, which is also noticeable by the open positions number on various crypto exchanges. Perhaps the end of the year is affecting because, at this time in many countries, traders and investors begin to calculate the income and taxes that they will pay subsequently.

Based on this, the general forecast remains negative, and in the next month, we expect new falls, after which consolidation will begin at lower levels before the future growth. Many analysts also agree that the level of $6,500 is not the minimum, and we will see even lower marks.