Bitcoin now holds a market cap of US$120 billion irrespective of a hefty initial rejection of US$8,000. Bitcoin has now produced 79.46% of its complete supply by means of block rewards and will carry on to do so on a deflationary program. The upcoming block reward halving is established for June 12th, 2020. Miners will then acquire 6.25 BTC for each block, around every single 10 minutes.

Bitcoin Price Analysis 10 Nov 2017 1The really contentious difficult fork, SegWit2x, was not long ago termed off because of to lack of local community consensus. The proposed adjust was considered by some to be an improve to Bitcoin, was the second part of the New York Arrangement (NYA) scaling program, and would have amplified the foundation block measurement to 2MB.

While the program at first enjoyed about 95% of Bitcoin’s hashrate backing it, assistance experienced been waning with an expanding pace and a lot of influential signers backed out of the NYA on Wednesday early morning. Quite a few of these withdrawing assistance – which provided the lead developer Jeff Garzik – cited the lack of assistance in the local community as the rationale for suspending the improve.

Bitcoin Price Analysis 10 Nov 2017 22017 has been a busy 12 months for Bitcoin

The corporations pushing for SegWit2x provided the Electronic Forex Team, Coinbase, Blockchain, Bitpay, Shapeshift, Xapo, and BitGo. The people mainly accountable for this include things like Barry Silbert, Vinny Lingham, Mike Belshe, Wences Casares, Jeff Garzik, Peter Smith, Stephen Pair, Bobby Lee, and Erik Voorhees.

Apart from BitGo, who not long ago documented about 50% SegWit utilization amid their buyers, other corporations have yet to undertake SegWit addresses where feasible. This is perhaps due to the fact Segwit and potential scaling remedies like the Lightning Community seek out to disrupt their organization design totally.

Jihan Wu and Roger Ver were also concerned in the NYA, but exited the settlement early by means of their very own fork, Bitcoin Dollars, a direct response to the User Activated Soft Fork (UASF) which enabled SegWit.

Likely forward, any fork try wants to establish local community consensus before forcing modifications upon end users, petitions in opposition to the fork close to the entire world make that loud and clear. The UASF which lead to Segwit is an instance of a successful local community-pushed adjust.

Inspite of wild swings in hashrate after the last problem adjustment, a -4% problem adjustment is scheduled for <12 hours. If miners choose to continue to game these difficulty adjustments, expect a large spike in hashrate immediately preceding the adjustment with a large reduction immediately after. This locks in an inflated difficulty with downstream effects including block times <10 minutes, increase in unconfirmed transactions, and increased network fees.

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A secondary attack will include spamming transactions with 0 fees on the network to further fill the blocks and increase fees. This process will enhance the narrative that bigger blocks are needed to compensate.

While this manipulation can be seen as nefarious action, it is perfectly within the rules of the protocol to do so. Should these problems persist, changes will need to be made to prevent this from happening. Decentralization comes with positive and negative consequences. Attacks on the network will continue with opposing sides hoping for capitulation after death by a thousand cuts.

Bitcoin Price Analysis 10 Nov 2017 3Over the last 24 hours, global trading volume has exceeded US$2.8billion, being led by the Japanese Yen (JPY) and the US Dollar (USD) on CoinCheck and Bitfinex respectively. USD Tether (USDT) volume has steadily crept up over the past few weeks, likely signaling traders moving in and out of the safe haven coin, pegged to $1, before and after the SegWit2x fork.

Bitcoin Price Analysis 10 Nov 2017 4As of November 9th, Bitfinex will no longer be available to US Customers. Expect the volume share of GDAX to increase proportionally to the volume lost on Bitfinex. Coinbase, the USD on-ramp, continues to add several hundred thousands of users a week (data compiled by Alistair Milne). 

Bitcoin Price Analysis 10 Nov 2017 7

Technical Analysis

Any news event, like the canceling of SegWit2x, will have an immediate and violent impact on price. This news saw previous sellers that were fearful of the protocol changes buying back in, as well as pre-fork buyers who thought they were getting a post-fork airdrop/dividend selling. Anything near US$7,000 has been bought ferociously.

Bitcoin Price Analysis 10 Nov 2017 8The same type of price action occurred during the ETF denial announcement on March 10, 2017 by the US Securities and Exchange Commision. This usually disrupts any short term indicators substantially in the hours and sometimes days following. Similar events also occur in legacy markets during news events like non-farm payroll. Although this may be new to many crypto only traders, it is nothing too out of the ordinary.

The large bearish reversal patterns – Rising Wedge and Bearish Three Drives – continue to fill, with the march towards US$10,000. Both of these formations can easily be invalidated, but should not be ignored. Should either pattern resolve as expected, a pullback to 50% of the patterns range is expected.

Bitcoin Price Analysis 10 Nov 2017 8Bitcoin Price Analysis 10 Nov 2017 9There is also a large Spinning Top candle, on the three day chart, which is typically indicative of a reversal, even more so if it had closed red. When seen at the top or bottom of the range, it is usually suggestive of buyers or sellers coming to equilibrium. A similar candle preceded the downtrend in the beginning of September.

Bitcoin Price Analysis 10 Nov 2017 10On the daily chart, Ichimoku Cloud continues to show bullish metrics all around. There is a large TK disequilibrium building, suggestive of a pullback to the Kijun, US$5,450. A pullback with similar rationale occurred in the middle of September. The longer price remains in this zone without a higher high, the larger the probability retracement will occur. The first sign of trouble for the bulls will be a candle close below the Tenkan (blue).

Bitcoin Price Analysis 10 Nov 2017 11Overall, the trend is in full-steam ahead mode with signs of overbought conditions. A subtle but definite bearish divergence has formed with higher highs in price on lower momentum. The same divergence occurred in August to precede the September correction. A pullback and recharge here would be very suggestive of further all time highs via consolidation and markup.

One of the Pitchforks for this trend also suggests price is in the upper zone of the range. The Pitchfork uses three anchor points to predict a price channel with diagonal potential reversal zones. The median line is thought of the mean of the trend. Despite being the upper boundary of the channel, there is plenty of upside possible before a likely correction to the median line.

Bitcoin Price Analysis 10 Nov 2017 12An alternative Pitchfork, capturing less data and using more price channels, shows price in the bottom quartile with upside well beyond US$10,000. Subjectivity certainly plays a role when deciding which is best, but either Pitchfork will be invalidated with a price close outside of the extreme-most diagonals.

Bitcoin Price Analysis 10 Nov 2017 13Lastly, the best bet for re-entry should occur off of the Cloud signals on the hourly chart, most of which have temporarily flipped bearish. Signals to watch include price above Cloud, a bullish Cloud, a bullish TK cross, and Lagging Span above Cloud and price. These can all change quickly due to the low timeframe nature of the chart, and lower timeframe signals paired with a ranging price zone are a recipe for noisy and false signals with the Cloud system.

Bitcoin Price Analysis 10 Nov 2017 14Conclusion

The controversial SegWit2x fork has come to a close, at least temporarily. Many in the community immediately took a deep sigh of relief on the news. Although new user signups don’t directly correlate with new money being injected into the space, it’s one of the best metrics we have at estimating on-ramping through organic growth. Daily news headlines about the Bitcoin price fuel this fear-of-missing-out cycle over and over.

Despite the seemingly bearish technical indicators, the bitcoin mega bull train shows virtually no signs of slowing. Price action will become very interesting from US$8,000-US$10,000 if there is no correction to>US$5,000 1st.


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