September 3, 2018    Market Update

September 3, 2018 Market Update

Over the past week balance sheets in the both the NASDAQ and the Digital Asset Markets posted gains. These gains were relatively small but there were some notable stories among key components in both assets classes. Below are the charts for the Total Blockchain Market Capitalization and the NASDAQ 100 Futures.

 

 

NASDAQ 100 Futures. Chart courtesy of CQG

The notable story within the NASDAQ is Amazon’s increased market cap. Amazon is now closing in on a One Trillion Dollar market valuation. If indeed it does eclipse that mark Amazon will be the second company in history to do so!  The first was  Apple, $AAPL.

 

 

 

Digital Asset Total Market Cap. Chart Courtesy of CoinMarketCap

Within the crypto markets the most notable story by far belonged to Dogecoin which posted a gain of more than 112% pushing their market cap past $600 million.  As a result Dogecoin has moved into the position of  the  22nd most valuable digital asset according to CoinMarketCap.

The remainder of my blog will focus on a technical analysis of DOGE’s past price movement and its historical influence on the price other small and medium altcoins, notably $PAC.

A $300 million increase in total market cap may seem insignificant in the context of Bitcoin, however in the context of DOGE it should be seen as highly significant. This is particularly so for investors holding positions in blockchain assets paired with Dogecoin with emphasis on the lower market cap altcoins.

My experience in the cryptocurrency market has taught me that DOGE acts as a proxy for the medium to smaller cap assets. DOGE was actually one of my first holdings as it was by far the most efficient route to purchase lessor known lower value altcoins. This is still the case!

I will begin with some larger market indicators surrounding DOGE and then we can move on to explore them in more depth.

 

 

  • Presently Doge has verging on 116 billion coins outstanding
  • Over the first 29 days of August Doge’s average price stood at .0025 cents
  • Over the first 29 days of August Doge’s daily average volume stood at 2 billion coins
  • September 1st. Doge’s volume increased surpassed 40 billion coins over a 24 hour period

To put this into perspective –  throughout the first 29 days of August a modest 1.7% of the total Dogecoin supply changed hands leaving the DOGE price understandably flat. In stark contrast over a three day period alone from August 30th to September 1st more than 60 billion Dogecoins traded resulting in a price increase from 35 satoshi to nearly 100 satoshi.  Alongside this DOGE $price surged from .0025, briefly trading at .0067.

BTC – DOGE , chart courtesy of cryptopia

 

Dogecoin. Chart Courtesy of CoinMarketCap

The point I would like to emphasize on the DOGE chart above is the LOG moves. Simply put, LOG or Logarithmic moves have a high probability of happening in multiples of 2x, 3x, etc. We can see the low of 35 on the BTC- DOGE chart, the current price of 70 as well as the highest point achieved during this period of 105.
One log move is still being maintained however the two log move may prove to be too much too soon. Personal experience has taught me that these highs are often challenged and many times broken.

 

 

 

BTC-$PAC Chart. Courtesy of Cryptopia
With DOGE still acting as the gateway to many medium and smaller crypto assets it can be clearly seen from the BTC-$PAC chart above how the large DOGE rally during the Summer preceded the later $PAC rally.

 

$PAC Priced in US Dollars

With Labor Day Weekend behind us and tomorrow being the first business day of September the forthcoming week (from my experience in capital management) tends to be the unofficial start of the race for traders to meet targets before the close of the financial year. For those traders who have had great years, they still need to maintain those returns in order to receive their performance bonuses. While those who have underperformed have only four months remaining to demonstrate their value
As I have witnessed the cryptocurrency asset class mature year on year I am now expecting a very strong finish to the end of 2018. It is also worth noting that the start of the month is when institutions and funds allocate new capital. As such the first and last three business days of any month are always worthy of investor attention. This is especially true for the month following Labor Day Weekend.
My first parting thought for this blog would be that over the next four months there is an extremely high probability that at least one BTC ETF will open for trade. The market ramifications of this occurrence are wide. The second would be that the first day of trade for Ethereum futures is about to occur and as of yet has not received the news coverage it warrants. The CBOE and the CME, not necessarily in that order, are both expecting to have futures contracts traded in ETH within the 4th quarter of 2018. I would not be surprised if the first day of trading occurred in conjunction with the one year anniversary of the BTC futures contract launch.

 

 

 

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