Regardless of which way the trend breaks, Bitcoin is about to make a major move which has massive implications for the blockchain token market as a whole.
Let's examine fundamental and technical factors for the August 1st hard fork.
- Investors want free Bitcoin Cash and are "cashing in" alts for Bitcoin before the fork. The flow of capital between Bitcoin and Alt coins post fork will provide crucial information for future market moves.
- Institutional investors want clarity on where Bitcoin is headed before committing more capital. Recent SEC guidance on ICO regulation bolsters opinion that blockchain assets are starting to be legitimized.
The technical case is fairly strong for Bitcoin leading into the hard fork. Price is both above cloud, and the fast moving average stands to cross the slow moving average on any upward movement in price. This creates the strongest Ichimoku bull signal possible, a bull tk cross above cloud.
If the fork goes smoothly and bitcoin breaks 3,000 USD equivalent value, there is no more resistance to prevent a violent upward pressure on price.
The bull case is further bolstered by general market sentiment for crypto assets as regulations become more clear, and investors are continually bombarded with Bitcoin related stories in the mainstream financial media.
The bear case primarily rests on previous performance in the last major bitcoin bull market. However, comparison to the 2013 Bitcoin bull market is made difficult by the vast differences in the development of the technology in the ensuing four years, as well as the proliferation of alt token projects.
It must be noted thus far Bitcoin has not had a sideways movement lasting more than two months in its history that has not ended in a break to the downside.
If the double top pattern just below 3,000 USD breaks to the downside the bull market can be declared over. A reversal will likely last many months with a fibonacci retracement to 50% or even 61.8% likely for the entire market capitalization of the blockchain token market.
Pundits have also used Google Trends to point out searches for phrasing like "Bitcoin Bubble" have preceded previous busts.