Bitcoin Might Plunge to $5800 Mark, But It’s not Enough for Wall Street

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Published: Aug 7, 2018, 11:52 UTC

Although analysts remain bullish on the BTC perspectives, currently they warn us to be cautious. The US Securities and Exchange Commission (SEC) will approve the Bitcoin ETF from the Chicago Stock Exchange (CBOE)

The crypto market cap lost 20% in the last 2 weeks, falling from $300 bln to $250. The Bitcoin is trading now at around $7,000 comparing to $8,400 in the same period. Although analysts remain bullish on the BTC perspectives, currently they warn us to be cautious.

In the short terms, technical analysis is still on the bears’ side. The RSI indicator has decreased in the recent days but it is still far from oversold levels. Moreover, the benchmark currency doesn’t have important levels of consolidation near current trading marks. It means that after a short pause Bitcoin could slide down to the nearest consolidation level close to $6200 mark, and even lower to $5800.

The wide circle of investors needs more time to realize the new reality and to be confident of a new asset. The regulators need time to work out the rules. The institutional investors need lows to enter the market, and the large financial institutions need an infrastructure to bring the cryptocurrencies into the mainstream. And while everyone is waiting for a better time, cryptocurrencies can expect new lows, market clean-up, and increased volatility on the swings between optimism and

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ICE announced the cryptocurrency platform Bakkt in cooperation with Microsoft and Starbucks but the prospects did not provoke much positive impact. Such impressive brands, involved in one project that is aimed at adapting cryptocurrency to retail and pension funds, certainly reaffirm the desire of big firms to cover the crypto-sector.

Jamie Dimon, CEO of JP Morgan, once again named the Bitcoin “scum” and stated that “he was not interested” in the Bitcoin. Goldman Sachs intends to offer customers “crypto-depositary”, although the official line of the Investment Strategy Group report declares insolvency of the current cryptocurrencies. It seems that Wall Street wants to see really “extreme lows.”

According to unofficial data, on August 10, the US Securities and Exchange Commission (SEC) will approve the Bitcoin ETF from the Chicago Stock Exchange (CBOE). The review of other applications was postponed until autumn. The launch of the ETF Bitcoin will open the door to the cryptocurrency for the insurance and the pension funds, as well as different rank investors, concerned about the security of possession and storage of digital assets. If these risks would be borne by intermediaries with a strong technical and legal basis, an additional strong factor of support for the cryptocurrency and the Bitcoin market will appear.

This article was written by FxPro

About the Author

Ed Andersoncontributor

Ed Anderson has over 35 years of experience in the financial markets, having worked in London, New York, Toronto, Singapore and Australia. Ed provides in-depth Fundamental and Technical Analysis, as well as frequent market insights on multiple asset classes, to the benefit of FxPro clients.