BlockEdge Capital (BEC) Bitcoin Price Analysis For September 2018
BlockEdge Capital (BEC) recently released its first “Crypto Market Edge” report. The report highlights some of the predicted price movements for September 2018 and beyond, including where crypto prices are going to go and what kind of news we can expect before the end of the month.
You can view the 24 page report here. Below, we’ll discuss some of the most important news from the report.
Crypto Macro Landscape: An Upward Trend Throughout The Summer
“The current state of the overall Macro Crypto landscape has largely been dominated by headlines of a “bear” market for bitcoin and the rest of crypto for most of 2018,”
explains BlockEdge Capital.
Yes, we’re in a bear market right now. However, BlockEdge Capital is more bullish for the future than most other analysts in the space. BlockEdge Capital cites the fact that crypto prices have maintained a broader uptrend by maintaining a series of higher lows.
“These higher lows clearly show that there has been no break of the current long-term uptrend. For most of the summer we saw price test and hold the major long-term support area of 5800/6000 with 4 major lows in Feb, April, June and most recently the August lows.”
BlockEdge Capital goes on to explain that we have a long-term base of consolidation that has formed around these lows. This base of consolidation is forming as we await a breakout in momentum.
“The long-term trend clearly remains intact on this timeframe,” writes BEC, claiming that we can expect to see crypto prices continue to grow over the coming months.
Bitcoin Transaction Volume
Bitcoin’s transaction volume has declined in recent months. After reaching a peak in transaction volume in November/December 2017, bitcoin’s transaction volume has sharply dropped throughout the first 9 months of 2018. Nevertheless, bitcoin’s transaction volume is still significantly higher in 2018 – even during the lowest points of 2018 – than it was throughout 2017. If you ignore the spike in transaction volume in late 2017, then bitcoin’s transaction volume appears to have steadily grown over time.
BlockEdge Capital also insists that lower transaction volume isn’t necessarily a bad thing:
“This downtrend in volume is not necessarily a negative, and in most cases what we call distribution (a large amount of selling or dumping of a particular coin or assets) is marked by large volume on down days or large volume in the direction of the downtrend. Here we actually see falling volume on a relative basis from the prior volume on the way up. This falling volume as price declines is a positive on the margin for the bitcoin price.”
Understanding Volatility In The Crypto Market
There’s an interesting difference between volatility in crypto markets and volatility in traditional markets.
In traditional markets, volatility accompanies periods of falling prices. There’s fear and panic in the market, for example, so prices are volatile. A market might experience a sharp decline due to fear and panic, and then enter a period of volatility.
Bitcoin works differently from traditional markets.
“What is interesting is that bitcoin has behaved opposite of traditional markets. Instead of rising volatility in price sell offs and widening price ranges, we see falling volatility with price declines in the BTC price, and the opposite is true when price advances we see a rise in volatility ranges.”
BlockEdge Capital cites a chart showing that each rise in the price of bitcoin has been accompanied by a period of volatility. At the same time, each decline in price has been met with a rise in volatility.
Crypto Volatility Is Moving Down Overall
Meanwhile, in the wider crypto market, volatility has been decreasing overall.
“This trend in volatility has been falling in a downtrend along with the price after making those all-time highs in December of last year.”
The reason is obvious: bitcoin was most volatile in November and December 2017 when hype was fueling the outbreak. People were buying bitcoin without understanding the technology, hoping to make a quick buck. Google searches for bitcoin were spiking. It seems inevitable that volatility would similarly rise during this period.
Where Is The Price Of Bitcoin Going Next?
BlockEdge Capital seems to take a more bullish stance than other market analysts today, citing increased momentum and higher bottom points throughout summer 2018.
So where does BEC believe the price of bitcoin is going next?
To answer that question, BEC uses a top down approach with technical and cyclical analysis. By applying this methodology to bitcoin price charts, BEC believes it can make accurate predictions about the future price of bitcoin.
“The long-term trend of BTC remains very much in an uptrend and the bull market remains intact,”
writes BlockEdge Capital.
They also claim the long-term weekly trend of bitcoin remains in a long-term uptrend. Two of the biggest pieces of evidence for this uptrend are the higher lows at the 5800/6000 area, indicating a consolidation of resistance and the foundation of a future outbreak.
Nevertheless, when looking at the daily bitcoin price trends, analysis is more mixed than when using the weekly and monthly timeframes.
“The long-term daily trend is more mixed than the weekly and monthly timeframes. Price is in an uptrend technically as far as TMS, but the bands are not yet bullish.”
Ultimately, BlockEdge Capital uses their decade of professional institutional trading experience to make intelligent predictions about the future of crypto markets. You can view the full report on the future of bitcoin and crypto prices for September 2018 here.