What should we expect from BITCOIN

Guys, anyone who is trying to predict BTC right now is going to be on the hot seat! I think Alex did a great job charting BTC the other day and the possibilities of where it could go. One scenario we have, is that BTC has already corrected back to the $5500 levels, where we may see another run up to $10,000. However some would argue that the drop to those $5000 levels last week was a result of the BCH (Bitcoin Cash) run. If you were to ask me right now where I think BTC is going, I don’t think myself or anyone else could tell you. However, that doesn’t mean we don’t have indicators as to what behavior might take place. The market indicators are both positive and negative. On one hand there are indications we will reach the $10,000 range; and on the other we have some indicators that BTC may drop to the $5200 levels again, as predicted previously, essentially similar patterns to what we saw last week with the BCH run.

Now, let’s take a look at why I feel BTC has the potential to hit the $10,000 mark, which is now what about 50-70% of the crypto community generally feels will happen. First of all, you have this interest coming in from CME group, which indicated they will begin predicting profits for future trading in the month of December. This suggests to me that they will be launching in November (the 20th). This is definitely leading to an increase in trading volume, for me personally, not too much. I personally think the biggest push so far for BTC has been the announcement of integration with Square (great article here regarding that). Also with the advent of new groups interested and supporting BTC future trading, we have a lot of fresh money coming into the market. If this keeps happening guys, expect to see BTC moon to those $9,000 or $10,000 levels. Had there been no fresh money coming in, BTC would have corrected more by now.

Imagine you’re traveling to China, with a fresh stack of cash. You land, you’re excited, and know there’s some shopping to do. You’re completely culture shocked and aren’t familiar with the local fare, exotic cuisine, or even the language everyone speaks. Absolutely famished, you see the bright big KFC sign you’re used to seeing. Although there may be plenty of alternative options, you’re most likely going to go for the first product you’re more familiar with; even if there’s a 2-2.5x premium. That logic in mind, I believe most of the new cash coming in to the cryptocurrency market will go into BTC. It’s unlikely to go into Ethereum, or Litecoin or any of the other altcoins. Keep in mind, if this stream of fresh money doesn’t keep coming in, Bitcoin will have to correct itself at some point. Additionally, I don’t see the market being moved by your average Joe. The average Joe doesn’t feel comfortable spending $8-9000 dollars on a product he or she barely understands. The money required to keep BTC moving will rely heavily on larger financial institutions. Expect an increase in news regarding larger financial institutions getting their feet wet in the cryptocurrency market. As this new money comes in, if BTC increases to these 8/9/$10,000 levels, I don’t expect for us to see Bitcoin at a price near $4,000 again. The new base would be about $6000, $7000 dollars. Currently, for those in BTC, it’s a fantastic place to be. Use your stop loss profit control mechanisms, and don’t worry if your stop loss hits, feel free to buy back in to BTC, or just sit in USDT and have a peaceful evening. From the $5000 levels we saw earlier, you should have made an easy 20-35% increase in BTC, which is definitely something to celebrate. The $10,000 is totally possible in the near future, but it has several hurdles to get over first.

For the second half, I’ll be discussing some of the reasons why BTC could go down. These reasons are the macro indicators, and its hard to think they won't come into play. First, please keep in mind that this is not a BTC vs BCH war discussion. The indicators I am going to describe are purely why BTC may fall; not support for BCH. Our first indicators is also the institutional money come in. A lot of the institutional players that have been calling BTC illegitimate, are now taking note of the cryptocurrency. I find it highly unlikely that such powerful financial institutions would start buying into Bitcoin at such a high price. These are not foolish amateurs. The only way they would consider buying in to BTC now is if they felt strongly that Bitcoin could reach levels upwards of $20,000 to $30,000 dollars within a span of a few months. Whether that's possible, you never know. In my opinion, current indicators aren’t apparent for that kind of astronomical increase. So the likely scenario is some institutionalized correction, either via a similar situation with JPMorgan’s fud a month or so ago, or perhaps a bull trap with corporate accounts and hedge funds.

The second potential negative you have to be mindful of, is the China factor. China still isn’t back in the game, and you have to realize they own about 70% of the mining. 70% of the generation of a coin that is gaining huge value! So we have to expect that they will not stay silent on the issue. What happens if they ban mining? Expect a massive crash from nearly every coin. 30% of the world will be unable to handle the remaining transaction volume, potentially reducing the effectiveness of the Bitcoin network to historically poor performance levels. There is also the possibility that China creates its own cryptocurrency, similar to Russia’s CryptoRuble. The fact that we haven’t heard anything yet leads me to believe they are planning something like that, or getting ready to officially support Neo (because if they wanted to ban Neo, they probably would have already done so). I do not feel that China is against cryptocurrency, but waiting for the most opportune time to make a formal announcement regarding its future. Essentially don’t rule out China! I do not think we will see an accurate representation of the true BTC value until they come back into play. Large sell-offs have occurred at historic levels in the past, and this period in time is no exception to that possibility.

With Bitcoin Cash falling constantly, and taking nearly a week to recover to $900+ levels, I do feel it has been dumped. BUT (and a huge but), knowing the businessmen Roger Ver and Jihan Wu are, I don’t think they would have dumped everything at $8000, and it may be possible for it to reach the levels of it’s previous rally. Although it’s more of a conspiracy theory, there is no reason why they aren’t waiting for another opportune moment to create another massive BCH run. Remember Bitmain still is only accepting Bitcoin Cash on their latest mining hardware for fees, which is huge. Market manipulation by Ver and Wu could happen bi-weekly potentially if they thought it possible. The only way this wouldn't work is if Roger and Jihan has sold off their BCH already to the consumer market, which I find unlikely.

Although this was a pretty lengthy post, I think it is important to get a broader picture of what is going on in the market right now from both perspectives. These macro indicators aren’t what is going on day to day, hour to hour, but what is shaping the market overall. If positive news keeps coming to BTC, keep trading this coin, but always keep in mind that it could fall and you must pay careful attention. Keep working with your stop-losses and profit control, and keep taking those marginal %2-3 hits and buy back into BTC when you need to. That will be better any day, than working with no stop loss and falling victim to a sudden crash. For those who have not bought into BTC, do put any fiat in at this time. Now is not the time to do so, wait until BTC stabilizes before you use your fiat. Keep buying and selling BTC depending on the news, keep your stop losses in place and pay attention to those macro indicators that Bitcoin will need to overcome before it can push ahead. Until things stabilize with the market, consider the BTC-USDT/BCH. Not to much to expect from BCH for now, now that the weekend is over looking at the way BTC is running. While you have BTC being manipulated to keep it at the levels it’s at, it’s likely BCH is being held up artificially the same way. I don’t believe that the market is undecided, maybe common Joe but not the institutions. Those invested in BCH only buy in under $1,200, or $1,100.

A quick note on USDT, there has been some news about possible artificial manipulation of the currency. So far nothing convincing has really come forward, nor anything substantial like an investigation. Unless something like an official investigation was announced, we really don’t see USDT crashing. Just remember to stick to your plan, and don’t emotionally trade these coins!

Team Crypto Leo