Welcome to the 49th issue of the Broker’s Beat. This week, we discuss the increase in Bitcoin users and look at what experts think about the market recovery for 2021.
BY THE NUMBERS
“Bitcoin price was trading slightly higher this past week, though still lower by around 50% compared to its peak around mid-April. Price mostly fluctuated between $32k to $37k levels, designating that the volatility has cooled down.”
“CEO and founder of SkyBridge Capital Anthony Scaramucci has talked to CNBC’s Squawk Box host Melissa Lee about the impact of the crackdown on Bitcoin miners that has recently been initiated by the Chinese government.”
“Discounted tariffs made Iran attractive to miners, now the country is having a hard time closing the gap between the production and consumption of electricity.”
“Agro Blockchain that concentrates on cryptocurrency mining is desiring a secondary listing on Nasdaq. The crypto-mining company was already the first to appear on the London Stoch Exchange listings.”
“The Utah-based CleanSpark is attempting to boost the efficiency of Bitcoin mining as environmentalists continue to fight against crypto mining.”
THE BITCOIN BEAT
A snapshot of Bitcoin’s spot price as of this writing is $32,578.38 representing a 5.74% increase in trading volume since July 7th at 9:10 AM. The 30-day volatility of BTC is 76.40% with a 24-hour price change of -6.87%. Bitcoin remains the top cryptocurrency trading with support at $27,000 and resistance at $36,000.
ETH is trading at $2,149.77 as of this writing, representing a 24-hour increase of 18.21%, and 30-day volatility of 82.69%. Over the last 24 Hours, the trading volume decreased by 3.38%. As of today, ETH holds 18.80% of the cryptocurrency market, making it the second-largest coin traded. It has a circulating supply of 116,608,708 coins, an increase of 13,453 overnight.
Regulators have begun to close down on the crypto space with intention and traders’ feelings are reflected in the charts. As reported earlier on Tuesday by CryptoQuant, July 6, 2021, the BTC spot exchanges outflow transactions count hit a new all-time-high (ATH) at 7,614 transactions as shown in the chart below. This is a record one-year ATH and means that more people were willing to buy BTC and send it out to external wallets for a long-term hold.
The BTC spot exchanges inflow transactions chart shown below also showed positive prospects after plummeting down from about 26k transactions on June 14, 2021, to about 10k on July 5, 2021. This implies that more traders are willing to hold their BTC bags in external wallets as opposed to sending them to spot exchange wallets for trades and selloffs.
It’s important to note that these rapid changes on both charts are simultaneously occurring at a time when increasing regulation crypto laws are being put in place. Despite this, more people are willing to hold more Bitcoin for the long-term benefits.
Finally, a quick glance at the BTC netflow chart for all exchanges shows that we had a negative netflow of about -6.3k on July 6, 2021. This also proves that the average selling pressure for BTC on exchanges has been on the low side this week.
As predicted in our previous issue of the Broker’s Beat, we are starting to see a bounce off the resistant hash rate levels this week. For a long time, the hash rate value has maintained a steady decline as shown in the chart below. However, the hash rate value hit its lowest value of 84.79 million TH/s in the past one year on July 3, 2021, and is already recovering back in the upward trend again.
China has done its worst to crypto and it still didn’t cause a prolonged breakdown in mining. As long as there is no further disturbing news on crypto mining and these miners successfully set up operational facilities in the US and other countries that support clean energy mining, there should be no reason for any decline.
Over the past week, BTC has been having a difficult time regaining the upward movement and continuing this bull-run. BTC has been unable to test major resistance points at 38-40k and has been trading sideways. ‘Experts’ believe that the Wyckoff accumulation phase still has one more retest of 28k BTC value before the markets fully recover throughout 2021.
We definitely expect to see more movement going forward as experts believe we’re in the disbelief phase of this BTC halving cycle as shown in the Wall Street Cheat Sheet chart below.
Expert analysts argue in favor of a continued bull cycle throughout 2021 as they emphasized that it’s almost impossible for a bull run to ‘end in disbelief’ as this would imply that this bull market is totally unlike any previous one.
When we take a look at the Supply Shock Ratio charts, it is evident that long-term traders are consistently taking over from those shorting their BTC. As the demand for BTC increases and the availability on exchanges declines, we may experience a massive supply shock as the year proceeds just like it happened in the fourth quarter of 2020 post-COVID.
Crypto NFTs (Non-Fungible Tokens) are booming and bringing more adoption to the markets with celebrities getting in on the action, not wanting to be left out. This also comes at a time when Hedge funds and other big institutions like Visa and PayPal are starting to adopt cryptocurrencies as a means of payment.
Lastly, perhaps the most crucial piece of information at this time is the fact that there’s been an increase in the number of active crypto users getting on the network.
According to Glassnode, the BTC network user growth metric is now believed to take on about 32,000 new users per day and rising steadily! It is even more surprising that this is happening at a time where the market isn’t on a steady green and there are more active network users now than there were when BTC reached an ATH of about 60k.
That’s all for this week! If you have any questions about what we talked about here or would like to explore trading with us, please reach out here.
The Secure Digital Markets Team