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Friday, September 24, 2021

Buy now

El Salvador buys in the fall; ethereum and bitcoin at lower highs




This article was written exclusively for Investing.com.

  • Steady rise since late July turns into sale
  • He went higher, so he fell more on September 7
  • He is already the national currency of El Salvador
  • Coinbase (NASDAQ 🙂 hits a regulatory hurdle
  • Another buying opportunity for the bulls; an “I told you so” for the bass players

On Friday, September 3, it appeared that the top two cryptocurrencies that account for more than 60% of the asset class’s market capitalization, bitcoin and ethereum, were on their way to new all-time highs. Ethereum broke the $ 4,000 level on September 3. During the Labor Day bridge after that, bitcoin soared to nearly $ 53,000 per coin.

Bitcoin hit all-time highs on April 14, 2021, the day of Coinbase Global’s IPO on the NASDAQ. The leading cryptocurrency reached $ 65,520 on the futures market and almost $ 64,800 on the OTC market. Ethereum’s highs were recorded on May 12, when the over-the-counter market value reached just over $ 4,370, and near-maturity futures recorded highs of $ 4,406.50 per coin.

The most recent rallies of the major cryptocurrencies petered out on September 7, when El Salvador officially adopted bitcoin as its national currency. Bitcoin and Ethereum have drawn dots on their charts as they hit lower highs. The bulls believe that this price action is another opportunity to load up on cryptocurrencies, while those who believe that they have no intrinsic value are saying: we told you this would happen.

The volatility of this asset class is unprecedented, creating many trading opportunities. However, the potential rewards come with a lot of risk in an asset class in which extraordinary price swings are the norm, not the exception. Cryptocurrencies went from bullish to bearish trends over the past week in the asset class, where sentiment could be as fickle as the weather.

Steady rise since late July turns into sale

At the end of July, bitcoin and ethereum recorded lows slightly higher than those of the end of June.

BTC / USD Weekly

Source: CQG

The chart above highlights bitcoin lows of $ 28,800 at the end of June, followed by lows of $ 29,215 at the end of July that lit the bullish fuse for the leading cryptocurrency. Bitcoin hit highs of $ 53,125 on Sept. 7, as sales hit the market, creating a bearish reversal of the daily and weekly charts.

This brought the price to a lows of $ 43,705 on the near-maturity futures contract. Bitcoin rose 84.5% from June lows to September 7 highs and was down 14.3% during the latest correction.

Ethereum rose more, so it fell more on September 7

While bitcoin experienced great volatility, ethereum’s price fluctuation was even more drastic.

Ether Futures Weekly

Source: CQG

Ethereum futures hit lows of $ 1,697.75 at the end of June. Following in the wake of bitcoin, it hit slightly higher lows at the $ 1,715 level in late July, when it started to rise.

Ethereum rose 138.9% from late-June lows to $ 4,056.25 highs and fell 21.6% to $ 3,179.75 lows on Sept. 7, magnifying bitcoin’s percentage move. Ethereum underperformed the upside and underperformed during the latest correction.

Bitcoin is already the national currency of El Salvador

Ironically, bitcoin fell on September 7, when it became El Salvador’s official national currency. The Central American nation became the first country to adopt bitcoin as a medium of exchange. The Salvadoran currency had been very volatile, and the government decided that using the cryptocurrency as legal tender would attract new investment and stabilize its economy.




Salvadorans can download the “Chivo purse”, an application created by the Government that will deliver $ 30 in bitcoin to promote its use. The International Monetary Fund, the supranational institution that granted an emergency loan to El Salvador in 2020, has expressed concern about the measure, citing economic, financial and legal consequences.

However, the government of El Salvador has baptized September 7 as “Bitcoin Day”. He celebrated the adoption by acquiring 200 coins of the cryptocurrency, increasing his holdings up to 400 bitcoin digital currencies. El Salvador’s leader, Nayib Bukele, has promised to buy “much more.”

Some cryptocurrency advocates believe that El Salvador is the first of many countries to adopt digital currencies. Brazil and Argentina are candidates, since the real and the peso have been under siege for years. El Salvador is a test, but the price action on September 7 was not the kind of reception the government expected: the price plummeted.

Coinbase hits a regulatory hurdle

As for other cryptocurrency market developments, last week, the SEC sent a notice from Wells to Coinbase. As noted above, Coinbase is the leading cryptocurrency exchange that began trading on the NASDAQ on April 14, 2021; the day they hit all-time highs at $ 65,520 per digital currency.

The stock’s pre-IPO benchmark price was $ 250, but the shares hit highs of $ 429.54 in a speculative frenzy on their first day of trading. Since then, Coinbase fell to a lows of $ 208 on May 17. The stock settled just below its reference price, at $ 248.32 per share, on Friday, September 10.

Last week, the US Security and Exchange Commission informed Coinbase that the regulatory agency intended to take the company to court to prevent it from rolling out its new Lend product. Coinbase intends to allow clients who own cryptocurrencies to lend them on the market to borrowers who will pay a commission, creating a yield.

This SEC measure is the first regulatory missile fired at the asset class and could have caused the price drop last week. Regulators and lawmakers are trying to get their hands on the burgeoning cryptocurrency asset class to “protect market participants.”

However, the underlying concern could be the control of the money supply. Cryptocurrencies are a libertarian effort to wrest money management from governments and central banks, monetary authorities, and supranational financial institutions to give it to individuals. Since money is the root of power, many government officials around the world view cryptocurrencies as a threat to their power.

Another buying opportunity for the bulls; an “I told you so” for the bassists

The bulls undoubtedly believe that the latest price correction for bitcoin, ethereum, and a host of other cryptocurrencies is another buying opportunity on the way to higher prices. Opponents are waving warning signals, stating that price action is a sign of instability on its way into darkness.

The bulls and bears make up an active and liquid market, so opponents and defenders will likely fuel a continuation of active trading and volatility. The variation in prices creates a paradise for traders, but it could be a nightmare for investors.

The cryptocurrency asset class is still in its earliest infancy. The short-term outlook is for lower highs since the highs in April and May. The medium term continues to be bullish, as the revaluation has been nothing less than parabolic.




TAMMY SEWELL
Tammy Sewell is our Writer and Social at OICanadian.com. Tammy loves sports, she writes our celebrities news. She spends time browsing through several celebs news sources as well the Instagram. Email: [email protected] Phone: +1 513-209-1700

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