Bitcoin Rallies on Another Fork

Bitcoin prices rallied into another fork of the protocol and fell right after. Litecoin followed a similar pattern of first up, then down.

Bitcoin Rallies Into Another Fork

It’s a fork year for bitcoin! The door opened by bitcoin cash back in August is now in use again. The new (potential) fork is called bitcoin gold with the major change being a GPU-friendly mining algorithm. The supposed ‘snapshot’ happened early this morning on block 491,407. According to a help FAQ by Coinbase, the Bitcoin Gold team will pre-mine 100,000 Bitcoin Gold coins before releasing the software to the public. Unlike previous forks, the network will not be usable for several days until a working software is released.

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While some of the major exchanges said that they will give the resulting coins from the new fork, they have not opened spot or futures markets for BTG. Due to these reasons, it seems unlikely that bitcoin gold will be a hit with the markets. It’s currently worth about 0.047 BTC on some smaller futures markets.

Back to regular bitcoin! Going into this fork we saw a rush of money into BTC. This led to another new all-time high on October 21st at $6,187 dollars per coin. Last night we saw prices rally from a low of $5,622 to a high of $5,997 after a popular bitcoin exchange announced that they will give out BTG. These moves got quickly reversed as the snapshot transpired and few hours later a low of $5,527 was hit.

Prices on FXOpen are quoted at $5,688 right now and we’re still in an uptrend. To end it, the bears will have to push BTC/USD below the $5,147 swing low. A move below another swing low of $4,123 is needed for a new downtrend. On the longer-term charts, BTC remains in rally mode.

Litecoin Follows Big Brother

To a smaller extent, LTC/USD followed the patterns seen in BTC/USD. However, litecoin was under pressure versus bitcoin because people converted to BTC to get the ‘free dividend’. This meant that LTC/USD topped out days before BTC/USD on October 15th. From here it was a slow slide down, interrupted by bitcoin-inspired rallies.

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Now we are seeing a reversal of these money flows. As you can see on the chart above, today’s candle in LTC/USD is bullish versus the bearish candle in BTC/USD. We are currently trading at $57.30 dollars per coin. A break below the $51.11 swing low is needed to definitely end the current rally on the daily charts. On the weekly charts, LTC/USD is still range-bound but the monthly is in an uptrend.

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Petar Kotevski

Petar is a forex trader and writer with 9 years of experience in financial markets. He has been following bitcoin since 2010. A year ago, as the BTC market matured, he started getting more involved by writing articles on bitcoin and other alternative currencies.

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