The Month in Review: Analyzing the Cryptocurrency Markets in October
Finally, the cryptocurrency markets in October enjoyed a “green” month! For the first time since June, crypto traders witnessed a month of bullish price action. Despite the strong rally, however, all of the major cryptocurrencies are still well below their peak price level from June.
Cryptocurrency Markets in October
In the cryptocurrency markets in October, it certainly appeared that cryptos were headed for another bearish month. However, during the final days of the month, the major cryptocurrencies generated a spectacular bullish breakout, with Bitcoin leading the way higher.
BTC looks set to finish the month of October with a strong gain of around 13%. At least for now, it appears that the late-October rally generated enough momentum to push the crypto universe higher as we move into November. Don’t be surprised if the final 60 days of the year finish in “green territory.”
Why did the cryptocurrencies markets in October experience such a violent move to the upside during the last week? Let’s examine the details.
The Chinese Economy Goes from Strength to Strength
During the past 20 years, China has easily been the fastest growing economy on the planet. The country’s average annual economic growth rate has been 9.1%. For the sake of comparison, the US economy has grown at a much slower pace of 2.2% during the same time period. European and Japanese rates of economic growth have been even slower than the US. China is the envy of all nations when it comes to economic prosperity.
In terms of future economic growth, China is on pace to generate substantial rates of further growth well into the next decade. Why? Because the country is in the process of transitioning from an export-oriented economy to an economy based on domestic consumption.
The Chinese have one of the highest domestic savings rates in the world. Beginning in 2018, the government began encouraging its citizens to start spending and consuming instead of saving. Therefore, the country’s domestic consumption will allow China to continue to enjoy high levels of economic growth.
Chinese President’s Blockchain Comments a “Game Changer” for Bitcoin
All industrialized countries are scrambling to do business with China. They are fully aware that China is switching to a consumer-based economy. For the first time in the history of China, the government is inviting other countries to interact with Chinese consumers and small businesses. Consequently, there is a tremendous opportunity for countries to export their goods and services to China in an effort to build trust with its people.
President Xi Jinping is the leader of the People’s Republic of China. He is one of the most powerful people in the world. China has the world’s largest population, with over 1.4 billion people. Therefore, Xi is responsible for managing the largest economy on the planet. This explains why he is considered to be such an important leader.
Unlike President Trump, Xi Jinping rarely speaks to the media and he maintains a very low profile. Consequently, when he does make a public comment, people pay attention. On 25 October, he made some unexpected comments concerning the future of blockchain technology.
The comments were incredibly bullish in terms of China’s future adoption of blockchain technology. Specifically, Xi Jinping said:
“We must take blockchain as an important breakthrough for independent innovation of core technologies, clarify the main directions, increase investment, focus on a number of key technologies, and accelerate the development of blockchain and industrial innovation.”
Xi Is Credited with Initiating the Largest Single-Day Rally in 8 Years
Xi’s comments were perceived as extremely bullish within the crypto community. In fact, he was single-handedly responsible for unleashing the most powerful crypto rally since 2011. The major financial news services picked up the Chinese President’s blockchain comments in North America at approximately 5:40 AM on Friday, 25 October.
Just prior to the release of Xi Jinping’s blockchain statement, the price of BTC was trading near 7,507. Almost immediately, the price of BTC exploded to the upside. For the next 13 hours, Bitcoin rocketed its way higher. The final top occurred at 8:40 PM in North America. The price peak was 10,289, which represented a percentage increase of 37.1%. Please review Chart #1.
During the past few days, Bitcoin has surrendered some of its dramatic price increase. However, it has managed to keep the majority of its gains. At least for now, it appears highly unlikely that Bitcoin will fall back to the 7,500 level.
Most likely, Xi Jinping’s comments on 25 October marked the beginning of a new bull market in cryptocurrencies.
Digitex Testnet Launch is Fast Approaching
30 November is almost upon us! Digitex Futures will launch on the public testnet. During the past six months, Adam Todd and SmartDec have been developing and programming the Digitex Futures exchange and trading platform. The teams are on the verge of creating a truly disruptive product within the futures industry. Digitex has tremendous upside potential in these new bullish times for crypto.
Digitex Futures writers and/or guest authors may or may not have a vested interest in the Digitex Futures project and/or other businesses mentioned throughout the site. None of the content on Digitex Futures is investment advice nor is it a replacement for advice from a certified financial planner.