Why Is Bitcoin Tumbling and What Is the Outlook for Prices? 

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Comments of the Day 

20 April 2021

 

 

Video commentary for April 19th 2021

 

Eoin Treacy’s view

A link to today’s video commentary is posted in the Subscriber’s Area. 

Some of the topics discussed include: bitcoin pulls back sharply to threaten the uptrend and increase risk of contagion, Dollar falls, with Pound testing the psychological $1.40, gold steady, 

 

 

Why Is Bitcoin Tumbling and What Is the Outlook for Prices? 

This article by Emily Cadman for Bloomberg may be of interest to subscribers. Here is a section:

As digital assets make further inroads with both retail and institutional investors, regulators across the world are taking a closer interest.

On Friday, the Turkish central bank said it would ban their use as a form of payment from April 30 and would prohibit companies that handle payments and electronic fund transfers from processing transactions involving crypto platforms.

There was also online speculation over the weekend that the U.S. Treasury is poised to crack down on money laundering carried out through digital assets. The Treasury declined to
comment.

Other sources of regulatory pressure include central banks’ plans to create digital currencies such as China’s for the yuan, and the ban of cryptocurrency mining in Inner Mongolia, long an industry favorite because of its cheap power.

“We will see more regulation coming,” Eva Ados, chief investment strategist at asset manager ERShares, said on Bloomberg TV, warning investors to be “very careful.” “We think there is going to be even more volatility going forward.”

* Overexcitement
Any big rally offers potential for the market to get ahead of itself. That’s the view of Galaxy Digital founder and long-time crypto bull Michael Novogratz, who wrote on Twitter he sees the retreat as a healthy correction.

Mike Novogratz @novogratz
With hindsight it was inevitable????????. Markets got too excited around $Coin direct listing. Basis blowing out, coins like $BSV, $XRP and $DOGE pumping. All were signs that the market got too one way. We will be fine in the medium term as institutions coming to the space.
Sent via Twitter for iPhone.

* Idiosyncratic factors
Other things could be adding to the mix. Industry news site CoinDesk reported Saturday that power outages in parts of China had knocked out a significant amount of Bitcoin mining capacity, which reduced the overall processing power of the cryptocurrency’s network.

There’s also the timing.
“Bitcoin goes crazy on weekends because it’s one of the few markets open to trade in,” Kyle Rodda, a Melbourne-based market analyst at IG said. “And it’s lost some buying support.”

 

 

Eoin Treacy’s view

Direct listings put no limit on the quantity of stock that can be sold directly to the public on the first day of trading. In a normal IPO there is a defined quantity of stock than can be sold and there are lockups for insiders that prevent them from selling immediately. Direct listings don’t have those controls. One way to look at it is direct listings prevent dilution of existing shareholders ownership. Another is they afford insiders the ability to liquidate their positions in one fell swoop. It looks increasingly clear that Coinbase insiders sold $5 billion of shares on the first day of trading. 

 

 

How fintech companies are wrestling with commercial banks in Nigeria 

This article from Nairametrics may be of interest to subscribers. Here is a section:

Nevertheless, while banks have the customer base and staff numbers to tackle the disruptive potentials of fintech startups, their responses have been quite passive.

Fintech companies like Paystack, PiggyVest, Kuda Bank and others are innovating past traditional institutions by making digital financial services like lending, savings, or investing readily available to people. They have been able to recognize the pain points for users, which have not been addressed by commercial banks.

Other fintech startups have fueled the growth of alternative lenders which offer both higher yields to investors and faster, cheaper, more convenient loans for borrowers compared to traditional banks. Startups like Carbon and Branch offer lower loan rates than commercial banks and this is mostly because fintech companies are not subject to the operational costs involved in running a traditional bank with multiple branches.

In an exclusive interview with Nairametrics, Femi Oshinlaja, the COO of Cassava Fintech, a pan-African Fintech Group that enables digital financial services for Africa’s mobile consumers, explained why digital solutions are fast spreading across the African continent by stating;

“With the growth in smartphone penetration and greater pervasiveness of the internet, we see the convergence of the online channels with more consumers opting to use digital channels to send money home as they see the convenience of doing so from the comfort of their homes and not having to queue to make the transaction in addition to the affordability of the online option.”

 

Eoin Treacy’s view

Massive populations of young ambitious people represent outsized potential demand for banking and credit services. Since the vast majority of Africans have no experience of the traditional banking relationship, they represent fertile growth for the fintech sector. As a result, Africa is likely to where we see active efforts to introduce a blanket form of digital payments.

 

 

Midas Touch 

Thanks to a subscriber for the report from Celtic Gold which may be of interest to subscribers. Here is a section on seasonality:

 In the current year, the gold price seems to be running two months ahead of its seasonal pattern established over decades. The top on January 6th was followed by a clear wave down lasting almost three months until the end of March. This correction would actually have been more typical for the period March to June. With the double low reached at the end of March, the beginning of the usually strong summer phase would be conceivable from May or June this year. In the short term, seasonality continues to urge patience. At the very latest, the gold price should be able to take off again from the beginning of July.

 

Eoin Treacy’s view

The re-opening of the Chinese gold import window and the bottoming in demand from India represent examples of Asian buying looking to accumulate on weakness. Meanwhile, investment demand continues to moderate as ETF holdings remain under pressure. That suggests institutional buyers have been sufficiently chastened by the decline to want to wait of clear evidence of a bottom before recommitting.

 

 

Email of the day on pre-hospitalisation treatments for COVID-19

Yet another conspiracy theorist??? This cardiologist testifying to the Senate committee is worth listening to. If we believe what he is saying (and I do) we could have saved many a life in those aged care homes in Melbourne when these b/s medical officers were advising against alternative treatments to be given to the old folks who were dying like flies whilst waiting for the elusive jab. Makes my skin crawl with anger. Wake up people, something is very wrong. Please listen to this professional air his views.

 

Eoin Treacy’s view

The response to the novel coronavirus has been characterised by panic and that remains the case today. The only way to appeal to a panicky crowd is to trade in absolutes. The panacea offered by vaccines is an absolutism solution. That’s the primary reason for the championing of the vaccine solution.

 

 

Eoin’s personal portfolio: futures long opened March 30th

 

Eoin Treacy’s view

One of the most commonly asked questions by subscribers is how to find details of my open traders. To make it easier I will simply repost the latest summary daily until there is a change.

 

 

 

 

 

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