Bitcoin is testing a critical support: buy opportunity or the collapse will continue?

Bitcoin broke a critical support, and it continues to fall down. Credit: tradingview/TBGlobalist

UPDATE 06/02/2018: Bitcoin breakdown in the morning  through the up-trend line, but afterwards prices are staring to rebound as the cryptocurrency hit a low at $5900, nearby the first important support we drawn on the daily chart.

ORIGINAL STORY

People who invested in Bitcoin in December are probably living one of their worst nightmare. In 2017 Bitcoin, along with other cryptocurrencies, had an impressive rally that has been matched only by few stocks. With a return over 1000 percent on one year basis, the crypto market reached its euphoria phase in the last quarter of 2017, when Bitcoin quickly rose from $3500 to $20000 in only 3 months. 

At that time was nearly impossible to predict Bitcoin’s peak or direction, with analysts and brokers often divided between pessimists – with many alarming that Bitcoin is a bubble – and optimists – some of them said Bitcoin could reach $100.000. Many financial experts started to mark Bitcoin as a bubble in early 2017, when the most famous cryptocurrency was just about to broke $1000 psychological resistance.

Those pessimists have continued to alarm the crypto market during the whole 2017, helping to fuel a crying wolf situation, in which people ignored any kind of warning, even when prices were about to reach the all time peak. We at The Business Globalist released a technical analysis on early January, in which we pointed out that a big upper shadow on December’s candle was a clear sign the bullish was exhausted, and we experienced the rage of Bitcoin supporters.

And while many people are now experiencing with their own money that nothing goes up forever in the financial market, included cryptocurrencies, many are now trying to understand if the market will fall deeper or if it’s now a good buy opportunity. We’ll give some indications based on a technically analysis.

BITCOIN IS TESTING A KEY SUPPORT: REBOUND OR BREAKDOWN? 

If we take a look at the weekly chart above, we can see Bitcoin is testing the long-term up-trend line. This is a critical level, and if prices will breakdown this support then we will see the cryptocurrency drop more in the next days, towards the next two supports: the first at $5500 and the second at $3500.

The long-term up-trend line’s test could be a good opportunity to enter in the market in a long-term prospective, as long as we adjust the stop loss below this important support (if Bitcoin rebound the gain could be significant, otherwise if it drops we will not lose too much).

A possible rebound on Bitcoin is drawn on the daily chart. Credit: tradingview/TBGlobalist

In case of rebound prices will came back in the area $10000-$11000, before going to test the lower trend-line drawn from all time high peak. In this scenario we expect Bitcoin to move sideways, as buyers and sellers will continue to fight each other in that area, until the market will give a new direction.

We remind to our readers that Bitcoin, as well as any other altcoins, is a risky investment and is very volatile, and moreover is in the middle of a huge correction, which maybe is not over yet. Trade with extreme caution.

Apple stock could bleed for the entire 2018: 3 possible scenarios for the long term

Apple Inc. ($AAPL) is the most valuable publicly-traded company of all time, with a market value that reached over $900 billion in November 2017. The tech giant funded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne, could become the first company to be worth $1 trillion, however many analysts are skeptical on the long term.

Uncertainty has arisen on Monday, as Apple announced a deeper than expected cut to the production line of iPhone X, due to a weak demand for the new smartphone: the production will be slashed by 50 percent, down to 20 million from an initial estimated of 40 million units. At the same time, with a forecasting net income of at least $19bn, Apple is set to break its own record for profitability, mostly due to good sales during the Christmas period.

You can order your Apple iPhone X, Fully Unlocked 5.8″, 64 GB – Silver on Amazon

The Christmas sales may look exceptional, but the under performing iPhone X may indicate, after more than 10 years of success, a slowdown in the impressive iPhone cycle. The debate over the iPhone X is open, and some point out that is not the first time for Apple products to under perform in this period of the year. In December 2017 emerged reports indicating that iPhone 7 sales were selling “more sluggishly than expected”, and in January 2016 Apple announced a 30 percent production cut for its iPhone 6 and iPhone 6s.

The importance of the iPhone for Apple

Apple is sitting on a big mountain of cash, as the company is dominating the smartphone market – at least in high-end segment – from over 10 years, after a recovery driven by a series of innovating products squirm out of Steve Jobs’ great mind. The liquidity of the company is huge enough to face any kind of crisis, as long as the company is able to detect and correct its own mistakes.

By the other hand, while Apple’s liquidity is without doubt impressive, it is good to remind that over 50 percent of Apple’s revenues are made by the iPhone line alone. In a worst case scenario, where iPhone is wiped out by the next mobile revolution, Apple would lose more then half of its current value. This is not so unlikely to happen, as Apple seems to have lost its innovative power since Steve Jobs passed away, and it is now relying on iPhone’s incremental innovation to fill its treasure trove. The mobile market in the long term is almost unpredictable, and one single disruptive innovation could became a serious treat even to a tech giant like Apple, especially when the company is confused on how turn its money into killer applications.

Apple stock ($APPL): 3 possible scenarios for the long term

Apple stock’s monthly chart tells a lot about the company and its price history. First of all, despite all concerns caused by the production cut, we have to point out that the decline of the stock is not so alarming, as it doesn’t affect the bullish trend: prices are still above the uptrend line we have drawn from 2008 low.

Apple stock on the monthly chart, updated to 31/01/2018. Credit: TBGlobalist/XTB

Another interesting thing we can notice on monthly chart are the two peaks we had since the beginning of the rally: one in 2012 and the second in 2015. These two peaks identify two respective waves, as prices consolidate after touching an ATH. The next movement and the recent sales may suggest a new consolidation phase, which could lead prices back to the 2015 high, at $134, or lower till the bullish trend-line (yellow line).

Afterwards, we can anticipate 3 possible scenarios suggested by the pattern analysis.

In the first case, which is also the most optimistic, we have an immediate rebound after the consolidation period, with the stock that will breakup the previous ATH.

In the other cases we can forecast the formation of a Head and Shoulders pattern, one with a breakout of the neckline and another where prices rebound, marking the beginning of a new bullish trend.

A possible head and shoulders on the Apple’s monthly chart. Credit: TBGlobalist/XTB

In this latter case, once prices will hit the yellow line, or the second horizontal blue line (near $100), the stock will resume its long up-trend. This scenario is also quite positive, however since we analyzing a monthly chart we need to consider that the up-trend will not be recovered until late 2019 or 2020.  Investors looking to long-term opportunities can buy the stock once prices hit the yellow line for the first time, putting a stop-loss below the second horizontal blue line and a target prices to $165, a second to $200 and third to $220.

A breakout of an Head and Shoulders neckline on Apple’s monthly chart. Credit: TBGlobalist/XTB

In the worst case scenario we have a Head and Shoulders formation, followed by the breakout of the neckline, which may match with the yellow line or lower with the second horizontal blue line. The breakout will mark the end of the bullish trend and the beginning of a new bearish course, which will have the first target-price at $80 and the second at $50.

Our analysis, although it is designed for the long-term, can give us some indication about short and mid terms. In the next days we should have an indication whether or not we are in front of a new peak, and if this will be the case it could mean just one thing: Apple stock will bleed for the entire 2018. 

Nintendo stock is booming after Labo announcement: prices may overtake ATH in 2018

In 2015 Nintendo was on the brink of collapse, as the Wii U failed to replicate the great success of its predecessor (Wii), and with about 11 million units sold world wide in its entire lifespan Wii U is officially the worst selling home console of Nintendo. The value of the company declined fast, and from 2007 peak Nintendo’s stock (OTCMKTS: NTDOY) lost in 6 years over 80 percent of value, with the investors losing faith in the company competitiveness.

What Nintendo did back then was a true masterpiece that should be mentioned in any management book. Nintendo in 2015 quickly rebuilt a new strategy to bring itself back into profitability, without sacrificing the pillars that distinguish the company of Kyoto from other competitors: quality, innovation and creativity. On March 2015 Nintendo announced a partnership with DeNa to jointly develop titles for the mobile sector, and on April 2016 announced NX, the new console that will later be known as Nintendo Switch.

The skepticism around the company vanished when the Switch was unveiled to the public in October 2016, convincing the critics, the analysts and the players around the world. The 2017 has been a fantastic year for Nintendo, with the Switch becoming the fastest selling console in North America of all times.

Nintendo stock weekly chart updated to 19 January 2018. Credit: Technician/TBGlobalist

Skies are now crystal blue over Kyoto, and Nintendo’s stock rebounded from 2015 low and prices soared over 300 percent in two years, while the company’s market capitalization overtaked Sony on June 2017. The stock uptrend, moreover, may continue in the next months and in following years, as Nintendo keeps delighting the public with new killer applications.

Nintendo Labo will help the stock to sustain the uptrend in 2018

On Wednesday 17 January, during Nintendo direct 2018, the Japanese company announced Labo, a new line of interactive toys represented by 25 sheets of cardboard that players can turn into playable objects. The concept of Labo looks brilliant and in the video game industry is a very rare thing, which shows the hidden capabilities of Nintendo Switch. Labo is a tangible proof that in 2017 Nintendo was not just sitting and basking in the great success of Switch, but the company was also preparing to maintain its momentum for 2018.

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Nintendo’s stock soared by 4 percent for two consecutive days, as investors think the gadget will help to boost the Switch’s sales for 2018.

The technical analysis confirms the good moment for the stock and now there are few obstacles for the prices to reach the 2007 peak.

Nintendo daily chart
Nintendo daily chart updated to 19 January 2018. Credit:Technician/TBGlobalist

The breakaway gap opened in 2016 is a strong upside sign, and usually this always marks the start of a new trend, which for now has been confirmed by the events, as the stock recently close a pullback on 2008 low. Nintendo Labo announcement helped the stock to breakup the 2017 high, and now prices are free to reach the target at $60, with few obstacles separating the stock for its ATH.

At the moment, given the great success of Switch phenomena, we don’t see anything that should prevent Nintendo’s sales to perform well in 2018 and increase the company’s revenues for the fiscal year. The stock uptrend will continue in 2018 and is highly possible that the prices will reach and overtake the all time high during the course of the year. 

 

 

 

Bitcoin: complete technical analysis for short and medium term

Bitcoin

Bitcoin surged over 1000% in 2017, along with many cryptocurrencies that had a four digit performance, even through many analysts and investors defined the market as a bubble ready to burst any time. Over the course of 2017 alone we had dozens of those warnings: Jamie Dimon, CEO of JPMorgan Chase, said “Bitcoin is a fraud and is in a valuation bubble that will burst”; Jeremy Grantham, an investor who predicted last two big market crash, said “Bitcoin is a bubble that may crash soon”; the economist Jim Rickards warned Bitcoin “It’s on its way to zero – somewhere between zero and $200”; the billionaire Mark Cuban said in a tweetstorm “I think it’s in a bubble. I just don’t know when or how much it corrects. When everyone is bragging about how easy they are making $=bubble”.

Many people have given their opinions on Bitcoin, as the cryptocurrency market attracted the attention of institutional investors and governments, and we can also find many opposite declarations, some of which claimed “Bitcoin is essentially ‘digital gold’ for millennials, and the cryptocurrency could easily achieve the $100,000 range”.

Bitcoin’s prices are driven by many factors, whose government regulation is one of the most important, and while it’s nearly impossible to predict if and when any important government will regulate Bitcoin, recent consolidation gives us some indication on what to expect in the short and medium term.  

Bitcoin: important indications from the technical analysis

On Bitcoin’s monthly chart we can see a long upper shadow on December candle, when Bitcoin hit an all time high at $20.000 and soon afterwards prices moved down quickly. The long upper shadow tell us the uptrend was exhausted, and now bulls and bears are fighting to determine a fair value, while this pattern is often followed by an opposite trend or consolidation.  

Bitcoin
Bitcoin’s daily chart shows a sideways movement.

As we can see on the daily chart, Bitcoin’s prices are now moving sideways, for the first time in 12 months, in the channel 20.000-12.500. The breakdown of the support at 12.500 will push prices to test the 10.000 level, which should act as a psychological support, but in case of breakdown prices could drop quickly towards 5.000. 

We expect Bitcoin to move sideways in those first months of 2018, while the strong uptrend shouldn’t be resumed anytime soon.

EUR/USD is testing a critical resistance: inverse head and shoulders on daily chart

The Euro-Dollar pair (EUR/USD) is testing a critical level, as prices have being rejected by a resistance placed at 1,2085. This resistance is also the neckline of an Inverse head and shoulders, that we’ve drawn on the daily chart above. The chart pattern usually suggests a breakup followed by an uptrend continuation, however the breakup may be preceded by a pullback on November high, around 1,197.

The breakup would launch the EUR/USD pair toward 1,22 and then 1,25. The Euro is strengthening against the US dollar (and sterling) since Trump election (and Brexit forum), when the single currency was around 1,040 and some investors speculated on EUR/USD parity. A strong euro may create a dilemma for the European Central Bank, which is expect to wind down the quantitative easing programme this year if the euro zone continues to grow strongly.

Investors will focus their attention on next Italian general election, which will be held on 4 March. Italians will go to the polls to vote the next Prime Minister, and the result may introduce new uncertainty in Europe.

 

 

Bitcoin’s Friday bloodbath proves cryptocurrency is a risky business

On December 22 Bitcoin, as many other cryptocurrencies, had the most significant drop since 2015: the prices plunged below $11.000 and then they stabilized around $14.000. This kind of correction was inevitable for many analysts, after Bitcoin’s price doubled two times over two months and hit a record high of $19,857 (one year ago Bitcoin’s value was around $1.000).

Moreover, other altcoins had even better performance compared to Bitcoin:  Ethereum is up over 7.000 percent and Litecoin is up 5.400 percent. Those huge performances have attracted mainstream attention and people and financial institutions are jumping in the crypto-market more and more every day. However, Friday bloodbath should be a first warning to all people who are not familiar with cryptocurrencies , or any other investments, and turned to Bitcoin for an easy source of earnings.

Forbes’ Jessie Damiani indicated 6 possible explanations why the Bitcoin prices dropped so low, while some see the drop as fallout from long-unresolved problems with Bitcoin’s infrastructure.

The drop is probably not the Bitcoin’s bubble burst invoked by many analysts over the year, but Bitcoin’s extreme volatility proves this market is risky almost as any penny stocks out there.

 

5 interesting penny stocks to watch for 2018

Hemisphere Media Group Inc. (NASDAQ: HMTV )

Founded in 2013, Hemisphere Media Group is a leading U.S. Spanish-language media company serving the U.S. Hispanic and Latin American markets. The Hemisphere Media Group is the only public company with a focus on Hispanic people living in the US and it also serves many Latina American countries.

Pay-TV subscribers in Latin America, not including Brazil,  grew by 44% from 2012 to 2016, and are projected to grow an additional 15 million
from 53 million in 2016 to 69 million by 2021 representing projected growth of over 28%, while the U.S. census bureau estimates that the Hispanic population  in the United States will grow to 70 million by 2025. The network has over 50 million subscribers and the management estimate that user base will continue to grow.

Advertising revenues and retransmission/subscriber fees are the main sources of revenues and it is important to monitor these two variables, as they have an impact on the stock price.

Technically, HMTV is in a sideline channel and in November it hits a low at $11, a lever which played as support in the last three years.

HMTV stock on a daily chart. Credit: Yahoo finance

 Accelerize Inc. (OTCBB: ACLZ)

Accelerize Inc. a technology company that operates in the cloud business and offers software solutions for businesses interested in expanding their online advertising spend. Accelerize is primarily focused on Enterprise process
apps and in 2016 its Global SaaS software reached $106b revenues, with an increase of 21% over the 2015. In a nine-months period ended September 30 the revenues increased from $17.883.105 to $18.016.552 while the cost of every single voice (Cost of Revenues; Sales and Marketing Expenses;  General and Administrative Expenses;  and other expenses) increased about 30%.

The company has an history of losses and has a substantial amount of indebtedness, while the management estimates the Costs of Revenues will continue to increase in the next months. If the management will be able to secure the company’s line of credits and to lift the company’s cost structure is highly probable that the stock price will climb over 1$ again.

Accelerize’s stock is sitting on its all time low from more than 2 year and the prices are moving in a sideline channel range of 0,55-0,25.

ACLZ
ACLZ chart on a daily timeframe. Credit: YahooFinanceChart

Netlist Inc. (NASDAQ:NLST)

Founded in 2000 by Jayesh Bhakta, Chun Ki Hong, and Christopher Lopes, Netlist’s main business is memory subsystems designed for datacenter server, high performance computing and communications markets.

The company has introduced over the years many disruptive products and in 2015 signed an a strategic partnership with Samsung  to produce a new class of NVDIMM-P (NV-P) memory solutions. 

Netlist incurred over a nine-months period ending in September 30 a net loss of $10.3 million and the company has an accumulated deficit of $154.913 million. The management believes the Company’s existing cash balance,
together with cash provided by the Company’s operations, will be enough to t to meet the Company’s anticipated cash needs for at least the next 12 months, but if the funds will be inadequate the Company will have to significantly modify its business model and/or reduce or cease its operations.

The stock is near its all time low and usually a rebound may occurs from this level.

NLST
NLST monthly chart on the long period.
Credit:YahooFinanceChart

NII Holdings Inc. (NASDAQ:SIEB)

Founded in 1995, NII Holdings is a provider of wireless communication services that operates mainly in Brazil. The group, once listed in the Fortune 500, went through bankruptcy in 2014, and in the same year reached an agreement with its major stakeholders on terms on a Chapter 11 reorganization plan.

In 2017 revenues were impacted by pressure on competitive forces and the wind down of iDEN business: on a nine-months period ended in September 30, the revenues dropped from $736.6 million to $680.7 million.

The company is still sitting on an big debt and it still failing to generate enough operating cash flows and earnings to cover annual interest expenses and there are risks of a new bankruptcy.

The stock is at its all time low and at the moment there are no signs of rebound. For this reason we recommend to wait next quarter and see if NII’s financial situation starts to recover.

NIHD
NIHD monthly chart. Credit: YahooFinanceChart

Repros Therapeutics Inc. 

Founded in  1987 as Zonagen, Repros Therapeutics is a US-based pharmaceutical company focused on the development of oral small molecule drugs to address hormonal and reproductive system disorders.

Proellex, a drug designed to treat symptoms linked to uterine fibroids and endometriosis, is still in Phase II development and the Food and Drug Administration (FDA) has put the drug under partial clinical hold.

Enclomiphene, another drug in Repros’ pipeline, is it not likely to receive a positive response to its marketing application by the European Medicines Agency’s advisory group.

Repros Therapeutics has been recently acquired by Allergan, but the deal is under investigation by Monteverde & Associates PC.

The company’s stock is on its all time low and much will depend on the product’s pipeline approval and on the future plans of Allergan.

RPRX monthly chart. Credit: YahooFinanceChart