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⚡Bitcoin Price Faces Death Cross⚔️

Croxroad

07 Aug 2024 — 4 min read

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⌛ Death Cross Looms

The bitcoin price is staring at the death cross, a pattern that trapped bears on the wrong side of the market last September. BTC's near-term prospects are closely tied to the health of the U.S. economy and volatility in the Japanese yen. Some indicators are inherently lagging and offer limited predictive power, yet they consistently make headlines in traditional and crypto markets, often resulting in unnecessary panic among inexperienced investors. One such example is the bitcoin (BTC) death cross, which tends to spark heightened fear and impulsive reactions on social media despite its poor record of accurately predicting future price trends. So get ready, because one seems to be on the way. A death cross occurs when the 50-day simple moving average (SMA) of an asset's market price falls below the 200-day SMA. Right now, the bitcoin price's 50-day SMA is at $62,332 and falling, indicating a potential crossover with the 200-day SMA at $61,605.

💸 Marathon Digital's Aggressive Accumulation

Marathon Digital Holdings, the world’s largest Bitcoin miner, continues increasing its Bitcoin holdings as part of its “full HODL” approach. Marathon Digital increased its holding by 2,282 Bitcoin (BTC), worth over $124 million at the current valuation. This puts Marathon’s Bitcoin holdings at 20,818 BTC, worth over $1.14 billion, according to an announcement published on Aug. 6. Whales, or large Bitcoin holding entities, can have a significant impact on Bitcoin’s price. Large entities switching to a long-term holding strategy is considered a bullish sign for the underlying asset’s future potential.

Marathon’s commitment to a “full HODL” strategy, which is crypto slang for “hold on for dear life,” was reiterated by Fred Thiel, CEO and chairman of Marathon Digital, in a July 25 X post. Thiel announced that Marathon had acquired $100 million worth of Bitcoin in July, aiming to make BTC a strategic treasury reserve asset. This move is seen as a positive development, especially considering the world’s largest Bitcoin miner isn’t capitulating despite a 50% cut in block rewards due to the upcoming 2024 Bitcoin halving, which could force other miners to sell BTC. Marathon's strategy aligns with the belief that holding Bitcoin long-term will prove beneficial as the market matures and demand increases.

Beyond just buying BTC, Marathon also increased its Bitcoin production to 692 BTC for the month of July, marking a 17% month-over-month increase. The firm holds a total of $1.6 billion in total Bitcoin and cash holdings, according to the announcement. Marathon’s block wins also increased by 27% over the past month. Thiel stated, “BTC production last month rose 17% to 692 BTC compared to June, and our average operational hash rate grew 5% over the same period to 27.5 EH/s. We will continue to mine aggressively while the global hash rate comes offline due to a lower BTC price and use all the tools at our disposal related to mining economics for maximum production.” Notably, Marathon didn’t sell any Bitcoin during June either, highlighting its strong commitment to holding Bitcoin as a long-term asset.

👷 Risks of Trading Forex With Bitcoin

Trading forex with Bitcoin introduces several risks that traders need to be aware of. One key issue is the variability of exchange rates, as Bitcoin trades on multiple exchanges and the rates can differ. Traders must understand which exchange rates their forex broker will use. Additionally, there's the U.S. dollar rate risk: most brokers convert Bitcoin deposits to dollars immediately, exposing traders to Bitcoin-to-dollar rate fluctuations from deposit to withdrawal, even if they don't take a forex position right away.

The inherent volatility of Bitcoin also poses a significant danger. Bitcoin's price history is marked by extreme volatility, which unregulated brokers can exploit. Security risks are another concern; Bitcoins deposited with brokers can be stolen through hacking. To mitigate this, traders should seek brokers that offer insurance protection against theft. Furthermore, leverage adds another layer of risk, particularly for inexperienced traders who may not fully understand their exposure. While this risk isn't unique to cryptocurrency forex trading, it is amplified by Bitcoin's volatility.

Finally, trading forex with Bitcoin mixes asset classes, introducing a new intermediate currency that can unpredictably affect profit and loss. Cryptocurrencies have their own valuation mechanisms, and any funds not secured in a trader's base currency are at risk. This complexity requires traders to be well-versed in both asset classes to navigate potential pitfalls effectively.

🤣 Crox Road Memes

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