Bitcoin Price Highlights

Bitcoin price may be reversed as an inverse head-shoulder formation is shown on the 1 hour chart
Technical indicators point to a return of bullish momentum
Technical indicators Signals
The 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance Bitcoin Revolution is downwards. This indicates that sales pressure is likely to continue.

However Bitcoin Revolution resistance is downwards

However, the gap between the moving averages has narrowed considerably, indicating an imminent bullish crossing in the near future. If the 100 SMA crosses the longer-term 200 SMA from bottom to top, this is an indicator of an upward trend change. The bitcoin price is traded Bitcoin Revolution above these moving averages, which is a sign of a bullish momentum.

The RSI is pointing upwards without reaching overbought conditions, suggesting that buyers could continue to take over. The oscillator is currently at 40 and signals a slight sellers market. Stochastics are similar to RSI.

market factors

Bitcoin has experienced a slight recovery in the last few days. Currently, there are many problems in the traditional financial world. There is a vote of no confidence in Spain today and an Italexit is also a possible subject. In addition, US supervisors classify Deutsche Bank as a problem bank, which had a direct impact on the share price. The question is how an impending economic crisis will affect bitcoin. A well-known youtube is convinced that the traditional financial market will collapse in 2018 and push Bitcoin to a record level of $50,000.

Ethereum Prize Highlights
Ether price struggles to break the $585-587 resistance range against the US dollar
The bullish trend line is intact and supported on the hourly chart at $565
ETH must remain above the $565 support and the 100 hours SMA to avoid a down reaction
The Ether price must not breach the 100-hour SMA to remain in a bullish zone.

Technical indicators Signals

There was a slight upward trend above the $575 resistance. However, the buyers failed to keep momentum above the $585 and $587 resistance levels. A short term high was formed at $586.31, after which the price began a downward correction. It declined to below $580. However, the decline was protected by $570 support. The highlighted bullish trend line at $565 on the hourly chart is intact. Finally, the 100-hour SMA is also positioned near the $565 mark. Therefore, the $565 support is immensely important. A break below $565 could mean a major downward correction.

Ethereum Chart from TradingView

Ethereum price analysis
Looking at the graph, the current price development is positive as long as ETH is above $565 and the 100-hour SMA. On the other hand, buyers must overcome the $585-586 resistance hurdles to further profits. The MACD is slightly in the declining zone. The RSI is moving downwards and is currently close to the 50s mark and shows a fairly balanced relationship between buyer and seller. The highest support level is $565, while the resistance is $586.

Fed Report: Bitcoin Futures Blame for Fall in Prices

The introduction of Bitcoin futures in December last year, which gave investors the opportunity to bet against the value of Bitcoin, played a major role in the fall in prices in late 2017 and early 2018, according to the US Federal Reserve.

Bitcoins Connection to the futures markets

In the Federal Reserve Bank of San Francisco Business Letter published today, May 7, the authors conclude that Bitcoin’s rapid startup and subsequent fall in prices following the introduction of futures was no coincidence. Rather, it is in line with the trading behaviour typically associated with the introduction of futures markets for an asset – a situation comparable to the securitisation of bonds in the early 2000s.

“THE FOLLOWING BUST WAS DRIVEN BY THE CREATION OF INSTRUMENTS THAT ALLOWED PESSIMISTIC INVESTORS TO BET AGAINST THE HOUSING MARKET,” WROTE THE FEDERAL RESERVE. “THE EMERGENCE OF THE BLOCKCHAIN ALSO INTRODUCED A NEW FINANCIAL INSTRUMENT, BITCOIN, OFFERED BY OPTIMISTIC INVESTORS UNTIL THE INTRODUCTION OF BITCOIN FUTURES PESSIMISTS ENABLED MARKET ENTRY, WHICH CONTRIBUTED TO THE REVERSAL OF BITCOIN PRICE DYNAMICS.

Federal banking politicians have, especially in recent months, rejected bitcoin as an alternative currency to the dollar or other funds supported by the central bank. San Francisco Fed President John Williams, who will move to New York next month to head the Fed, was particularly critical.

CME Group & Cboe Global Markets

On 17 December, CME Group Inc. went public as the second stock exchange after Cboe Global Markets Inc. This date coincided with Bitcoin’s all-time high (ATH), which was then traded at around $20,000. The report’s authors, Galina Hale, Arvind Krishnamurthy, Marianna Kudlyak and Patrick Shultz, said that the introduction of futures has ended’unilateral speculative demand’.

One step at a time

The Federal Reserve argues that the use of Bitcoin as a boundless medium of exchange – which they call “transactional benefits” – will be the biggest factor in determining the price:

“WHILE WE UNDERSTAND SOME OF THE FACTORS THAT PLAY A ROLE IN DETERMINING THE LONG-TERM PRICE OF BITCOIN, OUR UNDERSTANDING OF THE TRANSACTIONAL ADVANTAGES OF BITCOIN IS TOO IMPRECISE TO QUANTIFY THAT LONG-TERM PRICE. BUT AS SPECULATIVE DYNAMICS ARE DISAPPEARING FROM THE BITCOIN MARKET, THE TRANSACTIONAL BENEFITS ARE LIKELY TO BE THE FACTOR THAT WILL DRIVE VALUATION FORWARD.”