Bitcoin is currently trading at $11,700 and has a market cap of $216 billion. The coin’s surge has been undone in the last 24 hours; however, with the way bitcoin is set up, the price might shatter the $12,000 level or head lower.
With price stagnating near $12,000, a lot of people might FOMO-in if the price breaches it. However, if it is just a fakeout and the price crashes lower, then millions in longs get squeezed and hence the liquidations may take over. Two main reasons for this include the CME gap, and healthy correction.
Last time bitcoin surged exponentially was in Aril 2018, however, the correction came after hitting a temporal peak in July. As of September 2019, the price crashed by 40%. With the way the price has risen, a healthy correction has been absent. To make matters worse, CME gap at $9,925 to $9,665 is worrisome. Hence, a wick down to this level would give the go-sign for the bull run.
Bitcoin four-hour chart
From the above chart, the price is forming a symmetrical triangle that looks like a continuation pattern. This might accrue a lot of longs. Should the price breach this pattern lower, then this would further help the long-squeeze.
A short position here at $11,809 with stop-loss at $12,011 and a take-profit at $10,902 would put the risk-to-reward ratio at 4.45. This is based on the expectation that bitcoin may drop 7.7% from its current position.
50 DMA [yellow] will act as perfect support catching this drop. Considering the CME gap, which is lower, this might be temporary support. Hence, it is prudent to wait for the price to clearly breach the pattern and $12,100 or levels below it before entering the trade. RSI indicator is also forming a lower low and heading towards the oversold zone, further supporting the short position.
Document Leak Suggests Major Banks Facilitated Transfer of $2 Trillion in Dirty Money – 10x Current Bitcoin’s Market Cap
Recently surfaced FinCEN documents revealed that some giant banks have knowingly transmitted trillions of dollars in suspicious transactions from Ponzi schemes and terrorist organizations. Names such as HSBC, Standard Chartered, Bank of America, JPMorgan Chase, and more, have been collecting significant fees while flying under the radar for years.
FinCEN Documents Reveal Big Banks’ Actions
BuzzFeed reported on September 20th about receiving thousands of documents of suspicious activity reports (known as SARs) sent from banks to the US Financial Crimes Enforcement Network (FinCEN). Banks are required to provide SARs in case of evidence of suspicious activity.
Although FinCEN sends the SARs to law enforcement agencies for further review, the entity doesn’t enforce the banks to seize operating with suspicious individuals or companies.
The Corruption Within The Legitimate System
BuzzFeed’s investigations indicated that HSBC’s Hong Kong branch allowed a known Ponzi scheme dubbed WCM777 to move more than $15 million even after three states banned its operations. The total amount stolen from investors is over $80 million, according to authorities. The scam’s owner used the funds to buy two golf courses, a 7,000 Sq.Ft. mansion, and a 40-carat diamond.
Standard Chartered transferred significant amounts on behalf of a Dubai-based company accused of laundering cash for the Taliban called Al Zarooni Exchange.
Some US giants such as Bank of America, Citibank, JPMorgan Chase, and American Express “collectively processed millions of dollars in transactions for the family of Viktor Khrapunov.”
Khrapunov is the former mayor of Kazakhstan’s most populated city who fled the country after Interpol issued a Red Notice for his arrest. Later on, Khrapunov was convicted in absentia on charges, including bribe-taking and defrauding the city through public property sales.
“The FinCEN Files expose an underlying truth of the modern era: the networks through which dirty money traverse the world have become vital arteries of the global economy. They enable a shadow financial system so wide-ranging and unchecked that it has become inextricable from the so-called legitimate economy. Banks with household names have helped to make it so.” – concluded BuzzFeed.
Former suspicious transactions investigator Martin Woods said that “some of these people in those crisp white shirts in their sharp suits are feeding off the tragedy of people dying all over the world.”
The leaked SAR documents have been submitted to FinCEN between 2000 and 2017 and cover transactions worth about $2 trillion.
Where’s Bitcoin’s Place?
Ever since Bitcoin began gaining traction a few years ago, people outside of the cryptocurrency field have often criticized the asset claiming that it enables criminals to transfer funds anonymously. Those individuals argue that the unregulated nature of cryptocurrency is to blame.
Interestingly, FinCEN Director Kenneth Blanco urged the US to enforce strict regulations on digital asset usage to minimize the adverse impact.
However, numerous reports compiled on the matter have indicated that Bitcoin is not as frequently employed for illicit transactions as most people tend to believe. In fact, this one showed that only 0.5% of all BTC transactions are linked to illegal activities.
The leaked FinCEN documents could further reaffirm the narrative that fiat currencies are still way more utilized for illicit transactions.
Bitcoin Price Analysis: Crucial Moment For BTC After Closing Under 150-Day Support, Bear Market Inbound?
Bitcoin’s price has just closed underneath the primary channel support (yellow line) on the daily chart for the first time since April 26, 2020 – over 151 days ago.
This could spell doom for the leading crypto’s short to mid-term prospects unless significant bullish volume arrives to drive BTC back into the up-trending channel.
According to data by Coinmarketcap, the global crypto market cap has also fallen back under $325 billion and set a new lower high for the first time since the extreme Coronavirus crash in March 2020 (see red arrow). This is usually a strong indication that the market has now turned favorably bearish.
BTC Price Levels to Watch in the Short-term
On the daily BTC/USD chart, we can see that the price is hovering above the critical support-resistance zone (green) at around $10,200 – $10,000.
This particular area is also reinforced by the 0.618 Fibonacci level, which previously acted as a strong resistance for Bitcoin back in May and June this year.
Bullish traders are currently using this solid foothold to attempt a re-entry back into the main channel above $10,380.
This is a crucial moment for BTC. Failing to break this resistance will likely result in a lack of confidence in the leading asset and further downside towards $10,000 and even the unfilled CME gap below at $9,665 – $9,925.
If this does happen, the 200-EMA (red line) at $9,800 will likely be one of the first supports to help slow down the decline. From there, the bottom of the CME gap at $9,665 should also provide a rebound opportunity for bulls once it finally closes. Other supports lower down can be found at $9,160 and the 0.5 Fibonacci level at $8,867.
The daily RSI adds further confirmation that Bitcoin’s price will likely continue to decline. There’s been a noticeable divergence between the price action and the RSI since August 1 (yellow arrow on RSI), which usually indicates that the trend is weakening. The daily MACD is also decidedly bearish, with selling volume appearing on the histogram as well as a bearish divergence between the 12 and 24 moving averages.
Total market capital: $329 billion
Bitcoin market capital: $190 billion
Bitcoin dominance: 57.9%
*Data by Coingecko.
Bitstamp BTC/USD Daily Chart
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Cryptocurrency charts by TradingView.
Altcoin Season on Wall Street: SPI Energy Stock Surges 3000% on Electric Vehicle News
When it comes down to sharp price movements, people tend to relate them to the cryptocurrency market and especially alternative coins. However, a massive four-digit percentage price surge occurred yesterday on Wall Street with a little-known company after it announced plans to enter the electric vehicle (EV) business.
3,100% Pump In A Day On Wall Street
Headquartered in Hong Kong, SPI Energy, a part of SPI Group, operates as a solar panel developer and wholesale supplier. Interestingly, the company also serves as a “turnkey, one-stop cryptocurrency mining hosting and equipment solution.”
Yesterday, though, SPI Energy launched a wholly-owned subsidiary called EdisonFuture Inc. The new firm’s establishment would enable the company to “design and develop electric vehicles (EV) and EV charging solutions.” Essentially, this would position EdisonFuture in the same field as arguably the most popular EV developer – Elon Musk’s Tesla.
SPI Energy CEO Xiaofeng Peng commented that Tesla has already demonstrated that this end-to-end business model in the renewable energy space can “generate significant value.”
Yesterday’s announcement impacted SPI Energy’s shares almost immediately. SPI closed the Tuesday trading session at $1,05. However, the stocks skyrocketed to a daily high of $33,53 on Wednesday, thus registering an impressive increase of nearly 3,100%. Consequently, the company’s market value also surged from about $15 million to roughly $460 million.
The high volatility continued until the end of the trading session, but this time in the opposite direction and SPI closed at $14.
So, It’s Not Just The Altcoins
The above example is not the first in which a Wall Street-traded company stock has showcased notable volatility. Earlier this year, the popular corporation operating a few rental car brands Hertz Global Holdings, filed for bankruptcy. The company stock plummeted to below $0,50 but in a few days surged by 1,000% to $5.53.
The drama regarding the German-based online payment processor Wirecard AG also resulted in highly-volatile stock price performance. After filing for insolvency due to missing $2.1 billion, WDI nosedived from 100 EUR to 1 EUR per share in less than a week. A few days later, news of ban lifting in the UK pushed the stock price to 9 EUR (a 900% surge).
Similar extremely volatile developments are generally linked to the cryptocurrency market, where double, triple, and sometimes even quadruple-digit price increases could occur among altcoins.
The difference is that the cryptocurrency market is unregulated, and it trades 24/7. On the other hand, Wall Street and all other global financial stock exchanges are highly regulated, with numerous watchdogs following each move.
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