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Bitcoin Lower after White House Crypto Summit Led by Trump

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Bitcoin Lower after White House Crypto Summit Led by Trump

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BTC/USD One Month Chart as of 8th March

Yesterday’s Crypto Summit at the White House didn’t meet the hopes of those who desire the U.S to be a proactive Bitcoin buyer. Baby steps accomplished for exchanges perhaps, but not a gamechanger for influencers looking to spark another rally higher.

Bitcoin is lower in early trading this Saturday, after the White House cryptocurrency summit essentially said it would hold onto Bitcoin that has been seized by the government, but did not express other impetus which would have driven the price of BTC/USD upwards.

While President Trump did sign an Executive Order creating a Strategic Bitcoin Reserve, it is important to note the holdings of Bitcoin and other cryptocurrency will consists of digital assets seized by the U.S, it doesn’t guarantee purchases of Bitcoin by the government.

Cryptocurrency backers may be unhappy with the White House’s lack of desire to engage in proactive cryptocurrency buying, including Bitcoin, which may have sparked the downturn being seen for the moment. One important statement in the Executive Order states:

“The Executive Order begins to resolve the current disjointed handling of cryptocurrencies seized through forfeiture by, and scattered across, various Federal agencies.”

A careful reading of the above and other declarations in the Executive Order, makes it clear that the Trump administration wants better oversight of previously seized Bitcoin and cryptocurrencies. The Executive Order while suggesting the government sold some of its Bitcoin in the past and other cryptocurrencies too early, can also be viewed as political statement proclaiming poor management – but this is an assertion which uses hindsight – which is always easier.

If the U.S government is holding substantial Bitcoin now, perhaps this may be the time to cash out considering the BTC/USD market is still rather highly valued. In other words, if the U.S government decides to hold onto Bitcoin too long it could simply prove to be just another speculator.

The Executive Order signed yesterday may create less restrictions and greater freedom for legally established U.S cryptocurrency exchanges that already exists. However, more flexibility for new enterprises trying to enter the sphere need opportunities they can pursue in what is already a competitive landscape. Bitcoin did trade above 91,300 yesterday, but after the Crypto Summit outcome began to see a selloff and as of this writing is hovering near 86,000 USD.

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AMT Top Ten Miscellaneous Considerations for this Friday

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

AMT Top Ten Miscellaneous Considerations for this Friday

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AMT Top Ten Miscellaneous Considerations 25th August 2023

10. Behavioral Sentiment: Risk adverse conditions heightened again.

9. Book: Pioneering Portfolio Management by David F. Swenson.

8. Rugby: All Blacks vs. Springboks tonight at Twickenham.

7. Federal Reserve: Jackson Hole Symposium and Speeches.

6. Travel Tips: Stay away from Russian corporate jets with Wagner members flying aboard.

5. South Africa: What’s next after BRICS Summit, an end to loadshedding?

4. Cryptocurrencies: Bitcoin, Binance coin remain under pressure.

3. Germany data: Coming ifo Business Climate and GDP data.

2. U.S data: Yesterday’s mixed Durable Goods numbers.

1. USD: Another burst of strength yesterday.

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Alert: Important Support in View for Binance Coin Traders

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Alert: Important Support in View for Binance Coin Traders

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BNB/USD One Year Chart as of 17th August 2023

Important support for BNB/USD is now being battled. The price of Binance coin is near a key inflection value of 230.00 USD. The digital asset world including Bitcoin and other cryptocurrencies has taken on stronger selling recently. Legal issues surrounding Binance have not gone away, nor will they. If Binance starts to show stronger price velocity lower it could spook the broad cryptocurrency market in a large manner. Binance is still the biggest crypto exchange in the world, even as it has come under the investigative pressures of the U.S and some European nations.

Traders should pay attention to ‘stablecoins’ as a barometer of behavioral sentiment in the cryptocurrency landscape. Tether should be watched closely. If USDT sustains value below the 1.00000 USD level for more than a couple of days this would be a negative signal that ‘players’ in the cryptocurrency world are getting more nervous.

Bitcoin is also seeing steady selling early this morning and the price of BTC/USD is near 28,550.00 as of this writing. If BTC/USD were to break below the 28,000.00 this could also add to fear and noise in the cryptocurrency world.

The next seemingly important level for BNB/USD below is around the 225.00 USD mark if tested, if this level proved vulnerable and trading momentum continued downward stronger selling could develop if panic erupts surrounding Binance coin. Traders should be very careful in the cryptocurrency trading environment right now. Legal shadows hovering over Binance have existed for a long-time, and if selling pressure were to mount and values are suddenly tested from June of last year when the 200.00 BNB/USD level was last tested (this as FTX collapsed) this would clearly not be a good signal.

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Tether’s Wobbling Should Set off Alarms for Crypto Traders

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Tether's Wobbling Should Set off Alarms for Crypto Traders

Tether is wobbling and this should not come as a surprise to cryptocurrency traders. While many speculators likely do not carry USDT in wallets or day trade the cryptocurrency, it does serve as a barometer in the digital asset world regarding behavioral sentiment. A sustained drop below the 1.00000 USD price tag should raise eyebrows and increase nervousness.

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Tether (USDT/USD) 5 Day Price Chart as of 15th June 2022

This morning’s drop in value in USDT/USD comes on the heels of trouble with Binanace and Coinbase via civil suits brought forth by U.S government agencies that accuse both exchanges of wrongdoing.

Tether’s accounting practices have been under suspicion for a long time and transparency has been lacking. While influencers within the crypto world can came claim all they want the Tether ‘stablecoin’ has nothing to hide – just like Binance and Coinbase – plenty of suspicion remains. And in fact a lawsuit brought against Tether’s parent company which was settled with a payment of nearly 41 million USD in 2021 to the U.S government via CFTC charges should serve as a caution sign.

A simple look at a five day chart of USDT/USD above shows the ‘stablecoin’ has incrementally suffered selling the past handful of days (this before today’s storm lower). Yes, folks may claim this has happened before and recoveries invariably have always developed higher, and they may be proven correct again. Perhaps today’s selling has been a mere reaction to the ‘public’ finding out about recent Binance transactions which are being reported, but maybe it is something more important – like a lose of confidence.

Until now the cryptocurrency world hasn’t really seen a strong reaction to the allegations brought forth from the U.S against Binance and Coinbase yet, and the question that should be asked is when is confidence going to crack again in the cryptocurrency world. Because as sure as the sun comes up and sets, the cryptocurrency world is going to suffer another major crisis, perhaps not today, but one will occur.

If the price of Tether starts to stumble badly and shows signs of not recovering that would spark a major downturn in the value of cryptocurrencies across the board. The darling of the ‘stablecoin’ world certainly has its detractors and there are certainly folks lurking who have been making long-term bets against Tether.

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Binance Coin (BNB/USD) One Month Chart as of 15th June 2023

Speculators in the digital asset world will be watching Bitcoin and Tether values closely. It has been reported that by many crypto media sources that Binance has recently made large trades involving USDT in an effort to boost their liquidity. What should concern traders in the cryptocurrency space is the ability of noise in the sector to turn into actual thunder which causes dramatic reactions to cryptocurrency prices.

Because while some people try to claim there are reasonable ways to value cryptocurrencies, in fact behavioral sentiment rules the jungle and a loss of confidence in the sector remains an extinction level threat for nearly every digital asset at anytime. The entire cryptocurrency space is vulnerable to fragility.

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Bitcoin Winter Threatens to Become an Ice Age

by with No Comment Cryptocurrencies & Digital Assets

Bitcoin Winter Threatens to Become an Ice Age

Many influencers within the digital asset world use the term ‘crypto winter’ as a way to explain the dramatic cyclical falls of value when cryptocurrencies prices crumble. The sun it is psychologically suggested, will shine again during summer, prices always heat up says the mantra.

However, the prices of the largest cryptocurrencies are suffering extensive erosion during this ‘winter’ storm. Although it may sound like a joke, a fear of a cryptocurrency ice age seems plausible. If values freeze too dramatically in the cryptocurrency world, will prices be able to thaw again?

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Concerns regarding the ‘evangelists’ like mantras of Bitcoin backers such as Michael Saylor, the CEO of MicroStrategy, are noteworthy. Perhaps Michael Saylor will be warmed by ‘summer’ prices again and see Bitcoin emerge higher, but many of his ‘followers’ are likely to get hurt if prices do not rebound soon. Clever quotes like Bitcoin is better than fiat currency. Bitcoin is scarce. Bitcoin can be taken anywhere in times of crisis, are all frequently heard. But these quips become rather shallow sounding and questionable, during these massive selloffs which can destroy an average person’s speculative pursuits if they have over leveraged on their wagers.

Some backers will certainly say people should not be speculating on Bitcoin, they should buy and hold. However its does appear any buying of Bitcoin is speculative. Anyone who decides to purchase Bitcoin should be willing to lose all of their money. Its history as a volatile speculative asset underscores this fact.

Influencers and backers will claim they are not responsible, and in many cases they are not, but fingers will be pointed and blame will be cast and evidence will be gathered. Class action lawsuits will certainly spring forth as people who lost money look for folks and companies to accuse of wrongs. Responsibility will likely have to be proven in a court of law. Lawyers are certain to make money from their work, they may be the only ones who are guaranteed financial success from Bitcoin.

The average costs of purchased Bitcoin is said to be around 23,500.00 USD within the current total supply of 19 million plus existing coins. The problem for BTC/USD is that it is below this average purchase price as of this morning by a rather steep margin as it trades near 18,400.00 per digital asset. Meaning many folks who bought Bitcoin now have a substantial loss. Yes, the buyers who paid too much can become ‘HODLers’, but will they really be able to maintain this stance?

Another noteworthy number, it should also be remembered that it is estimated around 3 million Bitcoins have been ‘lost’ permanently via the misplacing of cold wallet information, and the forgetting of passwords that are needed to access coins in hot wallets.

Consideration must be given to the costs of producing one BTC, which supposedly is around 26,000.00 USD currently. If the price of Bitcoin continues to struggle, at what point do miners say it no longer makes viable economic sense? The price of mining a Bitcoin is not about to get cheaper in this high inflation period as energy costs grow.

When does a real capitulation take place? Why is Bitcoin being so violent during the weekends? Why does some of the greatest volatility apparently occur on Saturdays and Sundays?

Now that the 19,000.00 price level has proven vulnerable, which is the next technical level BTC/USD could challenge? Price velocity is lightning fast. Many seasoned traders could historically say this shows that fear has taken hold in the marketplace, and that may be true. But typically the fear eventually runs into an intrinsic value for the asset which creates a pause. Traders seeking value can jump in and take advantage of the low prices and wait for summer to shine. However, Bitcoin has very little intrinsic value that can be quantified. So where is the price investors jump in?

Will the price of Bitcoin fall to 13,000.00 during this so-called winter? Could it become even worse? Who is going to jump in and buy Bitcoin if it continues to stumble and its price is as cold as ice?

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Words Matter in the Financial World and Noise is Dangerous

by with No Comment Federal Reserve, Interest Rates

Words Matter in the Financial World and Noise is Dangerous

As the financial markets trade in a nervous fashion the amount of ‘noise’ that traders must deal with has increased.

Markets Remain Jittery and Day Traders Pay the Price

The financial markets remain in a nervous state, and this is seen every day via the results from the major equity indices which continue to traverse within the framework of a threatening and potential bear market. Many new traders have not dealt with serious downturns in the financial markets before. Because human instinct is almost always positive, many speculators who participate in the markets tend to be buyers.

However in the past handful of months, many day traders who have been buyers have certainly found a difficult trading environment. Whether they are trying to pursue long positions in equity indices or cryptocurrencies, the speculative landscape has likely cost day traders money and produced trading accounts are negative, or worse simply have been closed.

U.S Federal Reserve Not Making Things Easy

The broad financial markets are likely to remain nervous in the coming months. The U.S Federal Reserve has a major interest rate announcement which will be delivered in the middle of June, and another rate hike of 0.50% is expected. What has the financial world nervous is not the anticipated interest rate hike which has already been digested into the marketplace, but what the Fed will say regarding their outlook regarding additional rate hikes in the summer. The reason why this is unclear is because the economic landscape remains cloudy and hotly debated.

The Federal Reserve has not helped investors because they have largely misread the economic landscape and caused problems because of past statements. Last year the Fed insisted inflation was transitory, meaning that it would soon diminish, this obviously did not happen. Now the best the Fed can do is to hope that inflation becomes less strong and that disinflation occurs. Meaning the U.S central bank is simply hoping it can decrease the rate of inflation.

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Words matter in this trading landscape for investors because the Federal Reserve’s policy has not exactly been met with popular fanfare. Many market participants feel that the Fed has pursued bad economic policy and that they have reacted slowly to data which was abundantly clear regarding supply problems, and the rising cost of production due to climbs in energy prices.

The Biden Administration and Energy Costs

While some in the Biden administration try to point the finger at the Ukrainian war with Russia as the culprit. Most people are not that naïve. Energy prices were on the rise before the war and it can be seen that the bullish trend in the price of crude oil has existed since the Biden administration took power.

President Biden during his recent trip to Japan spoke about inflation caused by rising energy prices that were in ‘transition’. He made it clear that rising energy prices in the U.S are happening because the U.S is following a green environment policy and that the shift in regulatory mandates is driving the costs of energy higher. This combined with the Federal Reserve’s frequent talk about inflation and its desire to raise interest rates has made for a dangerous combination.

Noise will remain at a High Volume

Inflation may come down in the coming months. Demand for certain commodities may erode to some extent. However the cost of energy is probably going to remain high throughout the summer. The additional shadow of mid-term elections in the U.S and the potential for a shift in power in the U.S Congress are going to affect nervous sentiment among financial institutions in the coming months leading right up to November.

Traders need to prepare for noise which will come from pundits as they express their opinions. Speculators who are day traders also have to take into consideration that their short term goals are in direct opposition to that of long term financial institutions. The difference in trading outlooks and monetary capabilities make this a difficult environment for day traders in the current market conditions.

Following short term trends for day traders based on behavioral sentiment is viable. Technical charts can be used to gather short term evidence, but this will not stop the constant threat of reversals and spikes in price velocity from suddenly gathering power and creating momentary bedlam.

Eliminating the noise generating from pundits who can walk away from their statements without any consequences is a must. Unfortunately the comments coming from the Federal Reserve and White House are often hard to ignore and cause reactions in the marketplace; because their words matter even if they sometimes seem to forget what they have said in the past.