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In the mid-summer, Bitcoin is experiencing relatively high volatility. After the growth to 8500 USD in July, the start of August is certainly a red candle. At the time of writing the analysis, the Bitcoin price is slightly below 7000 USD. Probably it is because the holiday season is associated with lower liquidity and easier market manipulation

Who is influencing the Bitcoin price?

Speaking of manipulation, we should also mention the controversial influence of the futures exchanges, the OKEX or BitMEX. While two years ago, the main influencer of the market was probably considered to be the Chinese exchanges with zero fees – the holy trinity of OKCoin, Huobi and BTCChina. Nowadays it seems that the futures has took this role – OKEX and especially BitMEX.

On the last day of July, OKEX was dealing with a giant forced liquidation which couldn’t be closed without a huge price fluctuation in the market. The size of the position corresponded to a quarter of all opened positions in the market. OKEX eventually did not close the position but the loss which could not be covered by margin was “socialized” over most of its users. The question is, who opened this position and why… if its liquidation was intended when he, despite relatively large loss, could have much larger profit on another exchange after the failed liquidation.

Recently, I have a feeling that instead of tracking the market and allowing traders to bet on future moves or ensure hedge positions, it is a Bitcoin market which is watching what is “being cooked” on the BitMEX and then that happens. As a result, this may do arbitrage robots which constantly flatten the price between index and the value on the futures exchange. The point is that the liquidity on BitMEX is much larger than on the stock markets which are the basis for calculating the index.

So the question is how hard it is to influence the price on exchanges that are part of the index (as far as I know, there are only two of them – Bitstamp and GDAX), and thereby to force a liquidation of some positions on BitMEX to happen. This can easily influence the direction of price development, especially when the rest of the exchanges blindly follow BitMEX.

A special chapter is the “perpetual” contract that BitMEX offers for BTC. The contract never expires, so the question is how much it has to keep its index. The whole thing is getting worse because of the BitMEX outages and occasional strange overloading of matching engine, so in some situations it is not possible to close the position, for example.

Enough about manipulation, let’s try to guess what the Bitcoin price will do in the next few days:

In my opinion, Saturday’s fall under the 7000 USD is a good opportunity to buy, but not for a long time. There may be a slight increase in price, but falling volumes will probably result in another sale. The Bitcoin price may then fall below 6000 USD again. We can expect the Bitcoin to return to 7700, not higher.

If you decide to buy, use stop-loss. The breakthrough of the indicated growth line would be a reason to sell. If that happens, buying over 6000 USD makes no sense. The same applies for the top line, if someone gets mad and pumps it to 8k USD. But the big players who probably make those manipulations will probably go against any technical analysis to profit the most.

Sentiment in the market

The OKEX – long position rules. TOP traders are balanced (51:44), but in volume it is 40:13.
Bitfinex has 32 thousands BTC in long and 20.6 thousands BTC in short. Short positions jumped up from 17.5 thousands on Saturday, but so did longs (from 30.5 thousands).
Dollars can be obtained on Bitfinex for 0.018% per day, Bitcoins at 0.0093%.
The BFXData server which provided data for the statistics has died. No messages about its possible recovery.

Recommendation: Buy for the short-term speculation; in the long run we go downwards, sales can be expected at the end of August.

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Disclaimer: These articles cannot be considered as an investment advice, and it is still a good idea to make speculation on bitcoin stock exchanges only with funds you can afford to lose. The high-profit potential is balanced with a significant risk of losing, especially here on the crypto markets.

Česky: https://btctip.cz/kurz-bitcoinu-analyza-konspirace-a-manipulace/