Top 5 Predictions of The Future Bitcoin Price

After Bitcoin nearly reached its record price in the last weeks of 2017, many have been speculating if a similar growth will occur again. While some believe that Bitcoin won’t be seeing any growth too soon, several crypto investors and analysts predict that BTC’s price will go up this year.

  1. Kay Van-Petersen: BTC Will Be $100,000 By December 2018

Kay Van-Petersen, an analyst at Saxo Bank, believes that Bitcoin could reach $100,000 in 2018, also adding that other rival coins could outperform it as well.

Van-Petersen predicted in December 2016 that Bitcoin would hit the $2,000 mark in 2017. At the time of his forecast, Bitcoin was trading below $900. Bitcoin’s price went past $2,000 in May just as the Saxo Bank analyst foretold.

“First off, you could argue we have had a proper correction in Bitcoin, it has had a 50 percent pull back at one point, which is healthy. But we have still not seen the full effect of the futures contracts,” said Van-Petersen.

Bitcoin futures trading contracts were launched last year by CME and CBOE. The launch was regarded as a tactic to attract more institutional investors to the cryptocurrency market and to add some legitimacy to it. Van-Petersen believes that more institutions will get involved as time goes by, describing it as a slow and steady process.

For Bitcoin to reach $100,000, it would require a rise of over 635 percent of its current price of $13,601.43. It should also be noted that Van-Petersen has previously stated that the $100,000 threshold could take up to ten years to reach.

Even though Bitcoin has been trading sideways since the beginning of the year, Van-Petersen stated that Bitcoin tends to trade around a certain level usually followed by a “re-rate.”

“I wouldn’t be surprised if it’s something we are seeing. It’s kind of building a foundation, then will re-rate a bit higher.”

  1. Jeet Sighn – BTC will reach at least $50,000 in 2018

Jeet Singh, a cryptocurrency portfolio manager for the past six years, claims it is very common for digital currencies to oscillate between 70 and 80 percent of their initial record price.

When he spoke at the World Economic Forum in Davos, he compared digital currencies such as Bitcoin and Ripple to early tech giants like Microsoft.

“If you look at Microsoft or Apple, when they went public their stocks were very volatile because the market wasn’t mature,” he explained.

Mr. Singh explained that the market’s volatility might concern newer cryptocurrency traders, but older investors do not share their worries, as they are accustomed to these common fluctuations.

He also stated that he believes cryptocurrencies will be used in transactions more often in the months and years to come.

“There are not so many vendors right now who accept cryptocurrencies, but there’s huge adoption on the black market,” he claimed.

Adoption started mainly in countries with unstable economies and currencies, but this will extend to other industries and countries, he stated. He also noted that among coffee and tobacco farmers there seems to be a high rate of adoption.

“In different countries Bitcoin is qualified differently,” he said. It is a commodity in the US, a currency in Switzerland “but to me it’s more than a currency.”

Singh predicted that “bitcoin could definitely see $50,000 in 2018” even though “we will probably go through a suffering period of volatility.”

  1. Dan Morehead- $20,000 by December 2018

Dan Morehead, CEO of Pantera Capital, a cryptocurrency hedge fund worth $1 billion, has speculated that the crypto market could reach “$40 trillion” in the next ten years.

“It’s a fascinating market … a $400 billion market that nobody owns … we’ve never seen that before … the industry as a whole could easily go to $4 trillion, $40 trillion is definitely possible … It’s the ten-year forecast, it’s not going to happen overnight.”

Morehead noted that CBOE and CME’s listing of crypto futures from last year could be one way to “potentially go short with crypto asset investments” as the market develops. In spite of this, he estimated that Wall Street’s increasing interest in dealing with crypto trades would create “a vibrant crypto-borrow market within twelve months.”

Morehead pointed out that the market has now come back 25 percent since its first 2018 crash, and predicted that its price would reach a new record within the current year.

“Bitcoin has come down below its 200-day moving average, and that is important because the currency has been going up at 170 percent per annum for six years… it’s come off 65 percent since its highs, and if you put 100 bucks in each of the four times it’s touched its 200 day moving average, you’d have a 285 percent return… it’s a screaming buy right now.”

  1. Arthur Hayes – BTC will hit $50,000 by the end of 2018

Arthur Hayes, the co-founder, and CEO of BitMEX, stated that he believes Bitcoin’s value will reach $ 50,000 by the end of 2018.

Hayes is also a former employee of the Citigroup and Deutsche Bank equity. He cited that the reason for establishing BitMex’s base operations in Hong Kong is because he thinks the Asian markets are more accepting when it comes to cryptocurrency trading. He also thinks that digital asset trading is a more “established” industry in North Asia.

“Asia dominates cryptos because they’re very used to trading digital assets. South Korea has been trading digital goods related to gaming for two decades. When you move to a purely money based digital currency they understand that culturally, so they get on board quickly,” noted the BitMEX CEO.

When asked to give a Bitcoin price forecast in an interview, Hayes said it has the potential of reaching $50,000 before the end of the year. Regarding the seriousness of his prediction, Hayes commented that:

“It’s my job to make predictions. Whether they’re right or wrong, it doesn’t matter to me.”

  1. Tom Lee – BTC will hit 25,000$

Thomas Lee, co-founder of Fundstrat, has stated in many instances that he believes Bitcoin will recover. In a series of tweets, he pointed out that Bitcoin’s recovery chart has always had a V-shape and it is highly likely that the price will go up again. He predicts that Bitcoin will reach its peak this year at $25,000.

He believes that the biggest factor that will contribute to this growth will be the increasing involvement of institutional investors in the crypto markets.

“I think institutional investors have gained a lot of interest, and they haven’t really come into crypto yet because there is still some regulatory uncertainty. But that sort of ultimate allocation into crypto as an asset class is going to be a powerful reason why bitcoin rallies.”

Furthermore, historical data from Fundstrat also supports his enthusiastic forecast:

“Historically, ten days comprise all the performance in any single year of Bitcoin’s price,” he said. “If you just took out those ten days, Bitcoin’s down 25 percent a year. So as miserable as it feels holding Bitcoin at $8,000, the move from $8,000 to $25,000 will happen in a handful of days.”

Up until now, Lee’s predictions have been quite accurate, including the tax-selling pressure that was influencing the Bitcoin price through much of the first quarter of 2018.

Of course, there are numerous other predictions regarding Bitcoin’s price, these top five being just the tip of the iceberg. A word of advice though; don’t base your trading decisions on predictions alone.

5 Reasons to Buy Bitcoin Gold (BTG) While it’s Down

Choosing a digital asset to invest in, purchase for trade or HODL becomes a very difficult decision considering the ever-increasing number of cryptocurrencies in the market (1994 as at the time of this writing) the uniqueness of each project, and the highly unstable nature of the crypto market.

Bitcoin Gold (BTG) doesn’t attract as much attention as its siblings forked from the Bitcoin blockchain, however, it is an altcoin worth a consideration for possible investments.

Many factors come into play when investing in a digital asset, today we have come up with 5 reasons why you should consider investing in Bitcoin Gold today:

1. Current Price of Bitcoin Gold (BTG)

The last few months may go down in the record books as the gloomiest in the history of the market, as prices of assets dink with every passing hour, and Bitcoin Gold (BTG) is no exception.

As at the time of this writing, Bitcoin Gold is trading at $33.17 due to a price drop of 3% over the last 24 hours.

The current price of BTG makes the purchase of the digital asset seem like a steal. 30 days ago, the coin was valued at around $59, and well over $100 in the preceding months.

Bitcoin Gold is one of the most affected digital assets, the current value of the BTG coin is miles away from its value early into 2018.

Buying and HODLing Bitcoin Gold (BTG) now is going to be very profitable in the future. When the crypto market resumes its bull run (which it always does) we could see Bitcoin Gold (BTG) ascend in value, and perhaps scale the $100 mark and reclaim its position high up the crypto ranking.

2. Current Supply of Bitcoin Gold (BCG)

Bitcoin Gold has succeeded in keeping the supply of the BCG coin in check, as at the time of this writing, a total of 17,069,561 BCG coins are in circulation.

Coins with unchecked supply, in the long run, will not be able to function effectively as ‘money’ (a digital asset must be scarce to function effectively as money).

3. Transparency of the BCG Network

The Bitcoin Gold network was forked from the Bitcoin network which is popularly touted as the most secure and transparent blockchain.

Ever since its fork in October 2017, Bitcoin Gold has performed other smaller scaled forks to ensure that the network remains one of the most secure and transparent ones.

4. Bitcoin Gold has its Exchange Listings Right

Another major area where Bitcoin Gold has excelled is in exchange listings. Some major cryptos are not able to hit mainstream adoption because of poor exchange listings.

Exchange listings also increase liquidity ratios and diversify platforms users of a coin can trade. As at the time of this writing, BTG is listed on over 30 digital exchange platforms, including Binance, Bittrex, and Bitfinex.

5. Bitcoin Gold Democratizes Mining

While Mining Bitcoin is undoubtedly lucrative, it is plagued with the issue of being resource intensive.

One of the major reasons Bitcoin Gold was forked from Bitcoin’s blockchain is to put an end to this problem. Bitcoin Gold is popularly flaunted as the most lucrative digital asset to be mined in the cryptoverse.

The algorithm developed by Bitcoin Gold (and the ones to be developed) makes the mining process runs at almost the same speed on different devices, which means rewards from mining pools are not that different. And miners do not have to spend heavily before mining BCG.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

Cryptocurrency markets are steadily coasting along after suffering from some volatile low swings last week. Over the past 24 hours, most cryptocurrencies are still in the red nurturing losses between 1-3 percent, and a few are in the green by a few percentages. At the time of publication, the price of bitcoin cash (BCH) is hovering around $850 per coin. Meanwhile, bitcoin core values are meandering just above the $6,500 region.

Also read: William Shatner Joins Bitcoin Mining Project, Admits He Doesn’t Quite Get It

SEC Announcement Adds Second Wind Into the Cryptocurrency Market Sails

Since last week’s ‘Bloody Sunday’ cryptocurrency market have seen some slight recovery but not by much. Markets were dropping pretty low up until the U.S. Securities and Exchange Commission (SEC) revealed cryptocurrencies that are decentralized are not securities. After the SEC’s head of the Division of Corporate Finance, William Hinman, made these statements digital asset markets saw a small rally and this push has kept markets from drawing lower, at least for a short period of time. The overall market valuation for all 1600+ cryptocurrencies is currently worth around $280Bn USD and 24-hour trade volume for the entire lot of digital currencies is $10.8Bn.

BCH Market Action

Bitcoin cash markets have steadily held above the $840 – $855 region over the past few hours with around $303Mn in 24-hour trade volume. Just like before last week’s dump, trade volume is pretty flat and action has simmered down over the past day. The top exchanges swapping the most BCH today are Okex, Exx, Hitbtc, and Bitz. Bitcoin core (BTC) currently represents 48.8 percent of the trades swapped with BCH today. This is followed by tether (USDT 28.8%), USD (13%), KRW (4%) and ETH (2%). As of this writing, one BCH is equivalent to 0.1309 BTC, and bitcoin cash is the fifth highest trade volume.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

BCH/USD Technical Indicators

The daily and 4-hour charts on Bitfinex show that BCH bulls have some resistance ahead in order for the markets to progress upwards. The two Simple Moving Averages (SMA) on the 4-hour BCH/USD chart show the short-term 100 SMA is above the long-term 200 trendline.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

The two SMAs recently crossed hairs and this indicates a move to the upside could be in the cards. Both the Relative Strength Index (RSI) oscillator (54) and the MACd show deep consolidation and a touch of uncertainty. Looking at order books shows BCH bulls have some solid resistance past the $870 mark and some more between $900 – $950. On the backside, stronger foundations have been built up over the past few days and BCH bears will see some pit stops around $825 and $775.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

BTC Market Action

As mentioned above, bitcoin core markets have been hovering just above the $6,500 territory for most of today’s trading sessions. Trade volume over the past 24 hours for BTC is around $3.1Bn and the overall market capitalization today is $111Bn. The top five exchanges by BTC trade volume on June 16 are Bitfinex, Coinbase, Bitstamp, Kraken, and Neraex. The Japanese yen today is dominating BTC trades today by over 71 percent. This is followed by tether (USDT 14.3%), USD (9.1%), KRW (1.6%), and the EUR (1.3%). Currently, BTC dominance amongst all the other markets is 39.9 percent.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

BTC/USD Technical Indicators

4-hour and daily charts for GDAX and Bitstamp’s BTC/USD markets show quite a bit of consolidation as well. We can see from this chart that the two SMAs have also crossed paths with the 100 SMA just above the 200 SMA trendline. This indicates the path of least resistance will be towards the upside, but much like the BCH/USD 4-hour chart the gap is small, and the two could easily cross again.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

RSI levels are the same as well (52) and the MACd looks to be heading southbound soon. The current resistance zone for BTC bulls is between $6650 and $6775 (20 and 50 MA) at press time. On the back side, bears will meet resistance between 6400 and 6200 and significant foundational buy support beyond that. If things were to go into the sub-$6K region, the $5K region will likely hold for a very long time. However, at any time between this vantage point and that theoretical region, we could see a strong impulse leg upward.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

The Top Cryptocurrency Markets

On Saturday, June 16 the second highest valued market held by ethereum (ETH) is up 1.7 percent and one ETH is averaging around $500. Ethereum values over the last seven days are down 14 percent. Ripple XRP markets are down 0.4 percent over the last 24-hours and down 18 percent during the course of the week. One XRP is trading for $0.53 cents per token. The fifth largest market, EOS, is up 0.12 percent and down 23 percent over the last seven days. The EOS token is trading for $10.67 and the currency holds the fourth highest trade volumes today.

Markets Update: SEC Adds a Brief Market Spike — But Will It Last?

The Verdict: Skepticism Remains Strong

The verdict this weekend still leans towards the bearish side taking into consideration the current charts, but mostly, market volumes have been considerably low. The SEC news helped add some positivity to an otherwise extremely gloomy week as far as markets were concerned. Traders are likely to remain skeptical for the time being until some bullish signals appear. The good news is markets have found support once again but where it will take us from here is hard to say.

Where do you see the price of BCH, BTC, and other coins headed from here? Let us know in the comments below.

Disclaimer: Price articles and markets updates are intended for informational purposes only and should not to be considered as trading advice. Neither nor the author is responsible for any losses or gains, as the ultimate decision to conduct a trade is made by the reader. Always remember that only those in possession of the private keys are in control of the “money.”

Images via Shutterstock, Trading View, Crypto Compare, and Satoshi Pulse.

Want to create your own secure cold storage paper wallet? Check our tools section.

What is Going On With the Crypto Markets, Experts Share Opinions

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, you should conduct your own research when making a decision.

This week has not been too bright for the price of Bitcoin and other major cryptocurrencies, as the markets turned red. The price of Bitcoin started falling from around $7,600 to a low of just over $6,500 at press time.

Although this fall is not as dramatic as some others in the history of the volatile cryptocurrency, the general sentiment around the market has been negative for most of 2018. Still, Bitcoin is a volatile asset with its ups and downs still coming.

From the most recent slump that began on June 10, to a reprieve at the announcement that the SEC won’t consider Ethereum a security, the markets continue to go down, as well as up.


It has led many investors and interested parties to question what is going on in the market, especially in comparison to the highs of December last year.

A few experts in the field of cryptocurrency, investing, and markets spoke to Cointelegraph to give their insight into the current market situation, and why it is dropping.

Naeem Aslam, Emin Gün Sirer, Tom Lee, Miguel Palencia, and Alistair Milne, all discuss their thoughts as to the market is falling.

Naeem Aslam’s concerns with security and regulation

On June 11, it was reported that a small cryptocurrency exchange in South Korea was hacked and many mainstream media outlets tied this catalyst as a reason for the sudden downturn in the market.

However, many commentators have refuted this cause-and-effect link and have sought other reasons for why the price is down. However, regardless of how much effect the hack directly had on the price in Bitcoin, Naeem Aslam, Chief Market Analyst at ThinkMarkets, discusses how this latest hack is another instance of negative press for the cryptocurrency space.

“Exchanges are not utilising the top-notch technology to protect consumers and hackers are taking full advantage of this issue. The question is, is there any limit to these hacks? After every few months, we are seeing the same pattern emerging. This is the result of loose regulatory control and regulators must step in to protect the consumers. Anyone who wants to do with anything with exchanges should be forced to adopt high-grade security and regular security upgrades.”

The effect of these hacks adds a far bigger element of risk to investing in cryptocurrencies, and for the new market of traditional investors, and this is a big turn off.

“Traditional investors would look for riskier assets when the bull market is in full throttle and investors run for the hills when bears are in town. However, smart investors use a slightly different approach. They move their funds from riskier assets to those where they can seek safety.”

“For instance, in a bull market, sectors such as financial, tech and energy are the most favorite sectors. When the market starts to fall off the cliff, portfolio managers and hedge funds start to favour sectors such as consumer staples. They seek stocks with better dividend yield because, even though the general trend in the market could be to the downside, they still get a better yield relative to the overall market.”

Emin Gün Sirer looks at a crack down on manipulation

One of the bigger news stories to come out this week, that has also been tied to the downturn of the market is that research indicatesTether and Bitfinex were at the center of price manipulation, which led to December’s high of nearly $20,000.

Emin Gün Sirer, associate professor at Cornell University, looks not only at this news, but also at the fact that there is a law enforcement crackdown coming on price manipulators as a reason as to why the market is down. He also explains how the cryptocurrency market has not decoupled yet, which only adds to a bigger sentiment of negativity.

“The cryptocurrency markets are in their early stages. We know this from the fact that the coins still have not decoupled — they all move in unison, regardless of the merits of one project over another. This indicates that systemic risks to the area dominate all other concerns,” he told Cointelegraph.

“The current downturn is motivated by one such perceived risk: the law enforcement action on exchanges and their effort to put a stop to price manipulation. This was a long time in the making, and cannot happen soon enough. I suspect that the law enforcement action will be modest in scope and will bring much needed clarity and positivity to markets.”

While this investigation into price manipulation may be having a negative effect on Bitcoin’s current price, it can only be viewed as positive. And for Gün Sirer, it cannot happen soon enough.

“The fact is that these technologies are poised to transform the way we do business. They should not need market manipulation to sustain their value. I’m looking forward to a decoupled world where markets are able to evaluate each coin on its own merits.”

Three reasons from Tom Lee, plus futures effects

Tom Lee, the co-founder and head of research at Fundstrat Global Advisors, who is renowned for his bullish predictions on the Bitcoin price, has given Cointelegraph three reasons why the Bitcoin market is diving, and also mentioned his feeling on futures markets.

“I think there are several factors why cryptos are falling. One, we had a parabolic move at the end of last year, so there is a period of consolidation and price adjustment that is taking place.”

“I also think bigger factors this year have been a lot of government actions that have been taken this year that have scared crypto investors, probably the most notable is the actions taken by the US regulators, like the SEC taking action against ICOs.”

“Lastly, the pace of institutional investor participation in this space has been taking longer than expected, and I think part of that has to do with the slowness of getting some of the onramps established.”

Lee also told Bloomberg that he feels that the expiration of Bitcoin futures contracts has a part to play in the most recent decline in Bitcoin price. He explains this further to Cointelegraph by saying that these volatile movements from futures will not persist indefinitely.

“Futures markets, in normal liquid markets where there is broad participation, don’t have an effect on the underlie, the futures itself is adding liquidity, or attracting liquidity, because institutions can use it,” Lee explained.

“In crypto right now, the market has a supply/demand problem, because mining rewards, coupled with tax selling, and other factors have caused more supply versus demand for crypto. The futures markets have been subject to some potential manipulation. I don’t think it will be the case in a few years from now, but even though the futures markets at the moment are only a hundred-million or so contracts, it is enough to affect Bitcoin price.”

Miguel Palencia’s position on ‘whales’

For Miguel Palencia, chief information officer at Qtum, which currently ranked 20th in terms of market cap, this current low has a lot to do with the faux-decentralised nature of cryptocurrencies which are still expanding and distributing.

He talked to Cointelegraph of the effect that ‘whales’ are having on moving the price around, but also makes mention of how these types of players in a relatively small and new market are also helping the ecosystem stay alive.

“Bitcoin, like other assets and technologies, goes through cycles that affect its use, which is often correlated with the asset price. What we see here, is that the cycle was accelerated by situations which can be solved by fully decentralized operations. Eventually, when the blockchain ecosystem becomes fully decentralized and not controlled by big stakeholders and “whales,” it will be bringing back trust into the markets and we can see the markets climbing again, on the other hand, these market movers and shakers, supported by true Bitcoin believers, will not let Bitcoin reach zero.”

It is a double-edged sword then, according to Palencia. Whales must surely have a part to play in the supposed market manipulation, but they are also a driving force in keeping the market afloat with their own investment.

Alistair Milne’s view on rapid slowdown

Alistair Milne, CIO of Altana Digital Currency Fund and founder of Cointrader, is examining the entire year’s performance and putting that December rally into perspective. The markets may well be down compared to the highs of $20,000, but $6,000 or $7,000 per BTC is still pretty good.

“It is a combination of a rapid slowdown in adoption, user-growth and profit-taking, as well as hedging,” Milne told Cointelegraph, explaining why he believes the market is where it is currently.

“Altcoins particularly became very over-valued and were overdue a correction. We are now searching for equilibrium again, where demand meets supply. From a macro point of view, it has never been better, so I feel comparisons to 2014/15 are misplaced.”

While many are hoping the bottom has been reached and the downturn is ending, Milne still thinks it is coming, but that it will provide a much more stable base to rebuild upon.

“I think after we eventually bottom, it will be a far more gradual comeback for the price likely accelerating in 2019.”

No need to panic

The sentiment around the markets may be negative and one for concern when it comes to everyday investors, but overall, the experts spoken to do not seem to be raising any cause for alarm.

Gün Sirer is calling for more regulation and policing to try and stamp out the perceived market manipulation, and Palencia raises a good point about the need for Whales at the moment, but in the future, true decentralization will be reached and Bitcoin will be stronger for it.

Milne is also looking ahead, not worried about a bottom still-to-be reached, as it would allow for Bitcoin to gradually come back stronger. Aslam also brings up an important aspect that needs to be sorted out, that of hacks and poor security which are affecting market confidence.

There is a lot that needs to be patched up in the cryptocurrency market, and when these things are sorted out, the price should follow in repairing itself to a more pleasant level.

Crypto Markets See Mix of Red and Green, Top 10 Coins in Slight Decline

Saturday, June 16: after a slight rebound Thursday, crypto markets are experiencing a similarly slight decline, with all of the top ten coins by market cap down by one to three percent in 24 hours to press time.

Market visualization from Coin360

Bitcoin (BTC) is down about half a percent over the 24 hour period, trading at $6,530 at press time. The cryptocurrency has seen significant fluctuation this week, coming down from $7,623 June 10 to as low as $6,267 on June 13. Today, the coin has retraced some of those losses.

Bitcoin price chart

Bitcoin price chart. Source: Cointelegraph Bitcoin Price Index

Ethereum (ETH) is down by a similar margin, with a decline of under one percent over the past 24 hours. The leading altcoin is trading around the $500 threshold at press time.

Ethereum price chart

Ethereum price chart. Source: Cointelegraph Ethereum Price Index

Total market cap remains somewhat low, currently at $277 billion, according to Coinmarketcap. Crypto markets have lost around $63 billion in total this week.

Total market capitalization chart

Total market capitalization chart. Source: Coinmarketcap

EOS is one of the more affected coins among the top ten: shedding about 3 percent in 24 hours to press time, it’s currently trading at $10.72. Today EOS Mainnet has experienced a “freeze”, resulting in some downtime. The leading block producers (BPs) of the network are reportedly working on a solution to the issue.

While the top ten coins are experiencing some downward pressure, there is a number of altcoins that are moving in the opposite direction.

Ethereum Classic (ETC) has grown by 4 percent in 24 hours to press time, trading at around $14.50.

Basic Attention Token (BAT) is up 2.8 percent, currently at $0.26. The coin, which is ranked 52nd by market cap, is developed by Brave, a company established by Brendan Eich, ex-CEO of Mozilla.

On June 15, Fundstrat’s head of research Thomas Lee linked the recent decline in Bitcoin with the expiration of Bitcoin futures. Lee explained that the latest drop coincided with just one of the six expirations of Bitcoin futures that have happened since the Chicago Board Options Exchange (CBOE) launched Bitcoin futures trading in December 2017.

What the stock market’s most crucial week of the year tells us about the road ahead

Stock-market investors navigated, virtually unscathed, a gauntlet of central-bank gatherings, a historic summit between President Donald Trump and North Korean Kim Jong Un, and flaring trade tensions.

The S&P 500 index SPX, -0.10%ended the week essentially flat, managing the narrowest of weekly gains, up 0.02% to 2,779.66, while the Dow Jones Industrial Average DJIA, -0.34% posted a weekly decline of 0.9%. The Nasdaq Composite Index COMP, -0.19% outperformed both, rising 1.3% for the five-day period.

Not too shabby, considering that the Federal Reserve on Wednesday lifted rates for a second time in 2018, signaling, perhaps, two more increases to key interest rates remaining in the year, while the European Central Bank on Thursday submitted a road map for unraveling its crisis-era, multitrillion-euro bond-buying initiative, though at a less aggressive clip than markets had anticipated.

Read: Stock-market investors see China tariffs as a ‘buzzkill’

Also:What investors have to look forward to: no recession, but limited growth

Against that backdrop, the stock market appears unbowed, with signs of an uptrend that could take the Dow and S&P 500, which have been in correction territory — typically defined as a drop of at least 10% from a recent peak — since February.

Here are a few developments investors may consider as the market attempts its next move in the coming weeks:

Dow transports eye record

For one, the Dow Jones Transportation Average, which tracks the performance of companies ranging from railroad operator CSX Corp.CSX, +1.15% to airline giant United Continental Holdings Inc.UAL, +1.19% , is knocking on the door of an all-time high. The gauge, often viewed as an indicator of the health of the market because of the role transportation plays in a vibrant economy, stands just 2.6% short of its record close set on Jan. 12 and is up 9.4% since putting in its 2018 nadir in April, according to WSJ Market Data Group.

The performance of transports is particularly notable because the threat of a trade war and an uptrend in crude oil CLN8, -3.75% should otherwise proof a headwind for the group.

Nonetheless, the DJT finished up 0.6% on Friday, even as a trade spat between China and the U.S. intensified, with Beijing striking back against Trump’s decision to implement tariffs of 25% on $50 billion in Chinese products.

So-called Dow theorists see upward momentum in both the Dow industrials and transports as forming a bullish pattern. There is still more to work to do for those gauges to trigger an outright buy signal, however. Currently, the Dow stands about 5.7% from its Jan. 26 record high, while the S&P 500 is 3.2% shy of its late-January apex.

The VIX drop

Meanwhile, one market measure of volatility, the Cboe Volatility Index VIX, -1.16% , known as the VIX, has been trending decisively lower since a surge in February. The index, which reflects bullish and bearish bets on the S&P 500 in the coming 30 days and tends to fall as stocks rise, points to dimming expectations for an abrupt tumble in stocks because stocks tend to decline faster than they climb. The VIX closed at 11.98 on Friday (see chart below), well below a historic average between 19 and 20 and 68% below its Feb. 5 close at 37.32. That all suggests that a level of complacency may be taking hold in the market.

Bumpy trade road ahead

That said, the road ahead for the market looks fraught. Though tariffs have thus far not resulted in lasting damage, the biggest threat is that an escalation of tensions could eventually hobble global economic growth.

“The escalation of trade tensions could prove to have dire consequences on both economies. We estimate that if the U.S. were to impose trade restrictions on $150 billion of imports from China, and China were to retaliate in kind, the hit to each economy could reach 0.3-0.4%,” wrote Gregory Daco, head of U.S. economics at Oxford Economics, in a Friday research note, referring to the impact on gross domestic product (see chart below).

Narrowing yield curve

Meanwhile, persistent worries about the possibility of an inversion of the so-called yield curve, a line plotting the yields of Treasurys from shortest to longest maturities, have dogged investors.

Normally, short-dated yields are lower than longer-dated paper because investors tend to demand richer yields for lending further into the future. However, because many investors harbor concerns that the current economic expansion can’t last for much longer as it nears the ninth consecutive year of expansion, investors have been buying 10-year Treasury notes TMUBMUSD10Y, -0.62% , pushing yields, which move inversely to prices, lower. Meanwhile, 2-year Treasurys TMUBMUSD02Y, -0.15% , more sensitive to the Fed’s rate hikes, have seen some selling off, nudging yields up.

So-called yield-curve inversions, in which shorter-dated debt offers a richer yield than longer-dated counterparts, have been accurate predictors of recessions.

The spread between 2-year paper and 10-year stands at 36.9 basis points, putting it at its narrowest since around 2007. It hasn’t helped that monetary policies in Europe, Japan and elsewhere continue to take a less aggressive path, compared with the U.S., a factor that can drive investors to the relatively richer yields of Treasurys, adding to rate pressure there.

Still, “there is a difference of opinion among Fed officials of the significance of the flattening and potential inversion of the curve,” noted Marc Chandler, global head of currency strategy at Brown Brothers Harriman, with some members expressing the view that an inversion of the curve doesn’t necessarily have to result in a recession.

Stocks stalling

A big question for markets may center on the impetus for a fresh rally. Markets have stalled out in recent trade, with the year’s second quarter approaching an end.

Mark Newton, technical analyst and founder of Newton Advisors, said that “there have been signs now for the last few days of markets starting to stall out and gradually roll over, with financials and industrials falling by the wayside and technology getting up to areas of importance that should cause this sector to consolidate and pullback.”

Chandler said the end of the quarter, when buybacks tend to taper, may remove a key driver of stock purchases. As the quarter draws to a close, and the earnings season kicks off, buybacks could slow, he wrote in a recent blog post. “This may be offset by the savings drawn in U.S. equity market.”

OPEC’s June 22 meeting

Another event that is likely to be a significant influence to the broader market is a key meeting of the Organization of the Petroleum Exporting Countries set for June 22.

OPEC, along with 10 big nonmember oil producers led by Russia, agreed in late 2016 to hold back crude production by about 1.8 million barrels a day beginning in 2017. That pact is set to expire at the end of this year, and investors will be keenly watching to see if the cartel agrees to extend the agreement, which has helped fuel a rise in prices of West Texas Intermediate oil, the U.S. benchmark, and Brent LCOQ8, -3.87% , the global benchmark.

Fundstrat Claims Bitcoin Price Drawn Down When Futures Expire

In regular commodities markets, futures are understood to help stabilize prices to consumers.

Not so with Bitcoin, says the Head of Research at “independent research boutique” Fundstrat.

Tom Le, a former Chief Equity Strategist at JP Morgan, has floated a possible correlation between a fall in the Bitcoin price and the monthly expiration of Cboe (Chicago Board Options Exchange) Bitcoin futures contracts.

“Bitcoin sees dramatic price changes around Cboe futures expirations,” claims Lee in a note reported at CNBC. “This was something flagged by Justin Saslaw at Raptor Group. We compiled some of the data and this indeed seems to be true.”

The Cboe beat the CME (Chicago Mercantile Exchange) to the punch last December when they surprised the world and launched Bitcoin futures seven days before their competitor.

Cboe Bitcoin futures contracts, agreements to buy or sell Bitcoin at an established price on a particular future date, expire on the third Wednesday of every month.

Lee says that the price of bitcoins has dipped right around that particular Wednesday for four of the past six months the contracts have been circulating.

“Overall, bitcoin has fallen 18 percent in the 10 days prior to CBOE contract expiration,” although Lee notes that February and April were exceptions, when prices ran up just prior to expiration 15 and 16% respectively.

Lee added that the Bitcoin price tends to recover 6 days after the dip.

In regular commodities markets like agriculture, futures contracts allow corn farmers, for example, to make a deal in the spring to sell a certain percentage of their crops in the fall at a price that at least covers cost.

Bitcoin futures contracts allow Bitcoin miners to make the same kind of arrangement.

For example, if the price of Bitcoin is $5000 dollars today, a miner might sign a futures contract to sell 50 bitcoins (25% of total produced) three months from now at $4000.

If the price of bitcoins on the open market goes down to $3000, the futures contract protects the miner against losses across the board.

If the price goes to $6000, the contract helps the buyer obtain bitcoins at less than market price.

That said, bitcoin futures contracts are cash settled, meaning that no actual bitcoins change hands. Instead, parties to the deal settle the contracts by forking over cash differences.

The material reported by CNBC does not include a rationale by Lee of what exact mechanism is causing Bitcoin futures to pull down prices in the presumably much bigger direct Bitcoin-markets.

If there is indeed a correlation, it would suggest a huge amount of Cboe contracts in circulation or at least of lot of interest being paid.

The president and chief operating officer of Cboe Global Markets responded to CNBC regarding Lee’s hypothesis:

“While we are excited about our recently launched Bitcoin futures, the notion that they have materially affected the bitcoin price overstates their influence and ignores other critical facts. Our strict position limits and the limited open interest in our May and June settlements, suggest that the fall of Bitcoin can be more easily explained by other factors such as the recent regulatory scrutiny around the globe, steps by government tax collectors, the rise of other cryptocurrencies, and declining media interest in the asset.”

Lee was incorrect earlier this year when he predicted that hype and activity surrounding the massive New York cryptocurrency conference Consensus would kick off a rally of the Bitcoin price. “We expect the Consensus rally to be even larger than last year,” when Lee claimed the a doubling of conference attendees had something to do with a 69 then 138% increase in the price of Bitcoin in the days and months following the conference.

According to charts at, that rally failed to materialize this year, and the price of Bitcoin has only dropped since the Consensus was held mid-May.

This week saw a number of stories that suggest that all may not be well in the business of Bitcoin futures.

The CFTC (Commodity Futures Trading Commission) has reportedly subpoenaed four cryptocurrency exchanges – Bitstamp, Coinbase, itBit and Kraken, exchanges that provide Bitcoin spot prices the CME uses to settle its futures contracts- to provide comprehensive data on trading practices on their exchanges.

The CFTC began its inquiry after the exchanges failed to voluntarily furnish the data to the CME, which the CFTC regulates.
The exchanges have claimed the information is proprietary and the request “intrusive.”
The CFTC has been engaged since May with the US Department of Justice in an investigation into market manipulation in crypto markets, a phenomenon largely regarded as an open secret by experienced cryptocurrency players.
Yesterday, during a marathon YouTube broadcast hosted by anti-cryptofraud crusader Tone Vays, securities lawyer and crypto veteran Jason Seibert commented that veterans in the cryptosphere know the market is “rigged,” particularly for small coins.
In yet more grim news regarding Bitcoin futures, the world’s three top ratings agencies- S&P, Moody’s and Fitch- have stated they may downgrade financial institutions in any way exposed to Bitcoin futures trading.

Bitcoin news: Should cryptocurrency be taught in schools?

At its peak in December 2017, the digital coin reached almost $20,000, but its tumble is symptomatic of the industry’s vulnerability to hacking and calls for regulation.

Some economists have labelled cryptos Ponzi schemes, with famed investor Warren Buffett even comparing bitcoin to “rat poison squared” in May.

But Christian Ferri, president and CEO of blockchain advisory company BlockStar, says the volatility of cryptocurrencies should not deter educationalists.

He said: “There’s no safe form of revenue. If that wouldn’t be the case, any economy commonly driven by arbitrage as we know it, wouldn’t exist.

“Volatility is the trader’s best friend, and can be a great source of revenues if you are an investor and know what you’re doing.”

Stellar Lumens Gets Listed on itBit: XLM Given the Green to Trade in New York City for the First Time

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The financial regulators in New York have given Stellar Lumens (XLM) – a digital currency which was created by the founder of Ripple (a competing blockchain firm)– the green light to trade on one of the most popular digital currency exchange platforms in the US – itBit. This is the first time the authorities of the state have approved the digital currency for trading in the state.

Stellar Price Today: Current Price of XLM

At the time of writing, Stellar Lumens is trading at $0.2321 after an increase of over 4 percent since its new listing two days ago. Stellar Lumens is sitting on the number seven position on the list of top digital currencies based on market cap, and it boasts of a market cap of $4.45 billion and a trading volume of $49.22 million over the past twenty-four hours.

Stellar Lumens Gets Listed on itBit

ItBit, a digital currency exchange platform designed for institutional investors that used to offer only Bitcoin (BTC) trading, also got approval from the New York Department of Financial Services (NYDFS) on Thursday June 14, to add Ethereum (ETH), Bitcoin Cash (BCH), and Litecoin (LTC) to its trading platform.

The digital currency trading platform was also the first in the industry to receive a banking law charter from the New York’s Department of Financial Services three years ago – an authorization that is similar to, but bigger than the famed BitLicense of New York, required for firms that want to hold on to or offer digital currencies trading for customers in New York.

The New York’s Department of Financial Services also announced that it had awarded Xapo a BitLicense. Xapo is a firm that stores Bitcoin (BTC) with an underground vault in the Swiss Alps. The BitLicense given to them is just the sixth the NYDFS has granted since the License was invented three years ago.

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Crypto Trading, Explained

To improve rapidly, you need guidance and support from a mentor or a community you trust.

Ideally, a rookie trader should start by choosing a reliable exchange and playing with popular coins, such as Bitcoin or Ethereum. However, the learning by doing approach is too slow for those who want to succeed fast. Joining a community of like-minded traders could be one of the best decisions to make: there are plenty of groups on Telegram or regular meetups in the US and other countries.

Also, resources such as Taklimakan Network, the blockchain investment platform, connect amateur crypto investors and traders with industry experts. The company’s ICO started in April and will finish on August 31.

Unlike numerous intermediaries in the crypto world, the platform’s goal is actually to teach you to make your own investment decisions. Taklimakan Network is encouraging experienced pros to share opinions on crypto markets and blockchain projects, helping crypto newbies to trade from the position of knowledge.

Co-author: Vicky Lova

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, you should conduct your own research when making a decision.