Bitcoin remains bid this Tuesday morning following Friday’s sharp recovery [candle with long tail] from the low of $2500. Prices clocked a high of $2925 earlier today and currently trade around $2860.
As per coinmarketcap.com, Bitcoin gained 6% over the last 24 hours. Ethereum is up 12%. Ripple, Litecoin, NEM, Dash has gained 5% to 8% each. The total market capitalization of the crypto currencies has increased to $95.12 billion vs. previous $89.27 billion. The BTC dominance rate has declined slightly to 50.3%.
In a few hours the Bitcoin scaling war will be over as SegWit2x will be activated. This is positive news for the virtual currency and that is evident from the 'higher lows' formation on the price chart.
BTC technology faces split
Bitcoin's underlying software code could be split today to create a clone virtual currency named “Bitcoin Cash” [BCC]. As per Reuters report, “The initiative is being led by a small group of mostly China-based Bitcoin miners - who get paid in the currency for contributing computing power to the Bitcoin network - who are not happy with proposed improvements to the currency's technology.”
BTC to trump BCC
There is consensus in the marketplace that the BCC would be just another altcoin and not a direct threat to BTC. Most exchanges have not shown interest in the BCC. This only underscores BTC’s dominance in the crypto world and increases the odds of BCC being reduced to a mere footnote in the long run.
BTC holders will receive BCC
As mentioned yesterday, investors who hold Bitcoins before the split will effectively hold coins on both chains after the split. In this case, anyone holding Bitcoin tokens (BTC) on the original chain will end up with the same amount of Bitcoin cash (BCC) on the other. This could be the reason for the strong bid tone in the Bitcoin prices ahead of the ‘fork’.
Thus, BTC may rally to record highs on increased demand as the split will practically create money out of thin air for those who are holding the currency. Following the split, BTC may witness profit taking and the BCC prices may crash as investors are more likely to take profits on the coins received out of thin air.
How to track the fork?
Check out BTC fork monitor. If it detects a fork, a red notification would pop up.
Technicals
Daily chart
Resistance
- $2890 [2/1 Gann fan line]
- $2957 [July 20 high]
- $3000 [record high]
Support
- $2740 [1-hour 100-MA]
- $2536 [50-DMA] - 2500 [July 30 low]
- $2403 [July 26 low]
Observations
- Prices struggling to hold gains above $2890 [2/1 Gann fan line]
- The 14-day RSI is yet to breach the falling trend line
- Lower highs formation
View
- An end of the day close above the 2x1 Gann fan line would yield a bullish break on the RSI and open doors for a sustained rally to fresh record highs above $3000.
- On the downside, only a daily close below the 50-DMA of $2536 would revive the bearish view and expose $2275 [100-DMA].
Ethereum runs into trend line hurdle
Daily chart - Ether hovers around the trend line hurdle of $220
Resistance
- $249.40 [July 18 high]
- $258 [50-DMA]
- $280 [3/1 Gann fan line]
Support
- $204 [100-DMA]
- $178 [July 29 low]
- $130.26 [July 16 low]
Observations
Higher lows on price chart and 14-day RSI
View
Ether looks set to take out the descending trend line hurdle $220 in favor of $258 - $280 levels. On the downside, only an end of the day close below $178 [July 29] low would revive the bearish view and open doors for a re-test of $130.26 [July 16 low].
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