• Bitcoin (BITCOIN on xStation5) reversed its latest slump but key hurdles remain in place
  • Some South Korean officials could be involved in insider trading, inquiry is underway
  • Nordic countries could become a Europe’s hotspot for cryptocurrency mining

Bitcoin has had a tough week so far as it plunged almost toward $9,000 before sharply rebounding back above $11,000. The major factor standing behind such incredible volatility was South Korean as it’s still considering a ban on all cryptocurrency trading (meaning a close of all exchanges). While the Bitcoin price bounced back quite significantly bears seem to be still better positioned. Let’s take a closer look at the chart below in order to determine crucial levels to watch for ahead.

link do file download linkBitcoin appears to be likely to gain momentum in the nearest future, however the price remains constantly below the two critical technical levels. Source: xStation5

Having analysed a H4 time frame one may notice that the price saw an abrupt bounce on Wednesday which was maintained yesterday. We could also suspect that bulls could treat a 61.8% retracement as their first support but they have to be geared up for a clash with the two important levels as well. The first one is an upper boundary of a descending channel being additionally underpinned by a resistance line along with a 50% retracement of the same move. That said, one may assume that $12,550 may be a hard nut to crack at least for the first time unless South Korea dismisses its efforts aimed at banning digital currency trading or other like this event occurs. Nevertheless, even as this level is finally broken it will not mean a smooth way for bulls as another obstacle might be found in form of a medium-term trend line. To sum up, once the price breaks above the two mentioned levels it would pave the way for subsequent rises but not earlier.

South Korean officials could be accused of insider trading

While South Korea is still considering a full ban of all cryptocurrency-related activities some local officials decided to try to take advantage of the whole tailspin. There are some assumptions that the country government’s officials have reportedly sold all of their cryptocurrency holdings and profited before the regulators announced digital currency regulatory framework. The country’s Financial Supervisory Service (FSS) is investigating the case and it already confirmed at a meeting on Thursday that some employees of the government actually did so. Notice that the FSS has recently advised its employees to refrain from trading virtual currencies underlining that “if the supervisory officials engage in speculative transactions, it will be difficult for the public to understand ethically”.

Nordics could become a Europe’s hotspot for cryptocurrency mining

There is no doubt that a possible Chinese clampdown on Bitcoin may prompt China-based miners to consider shifting their location. Europe could be of the most encouraging places in the world especially Nordic countries given relatively low temperature limiting costs of keeping computers cool.

link do file download linkFinland and Sweden could be among countries which may lure Chinese miners the most. Source: Bloomberg

Taking a look at the chart above depicting power tariffs in some European countries one may notice that FYR of Macedonia along with Bosnia and Herzegovina are bye far the cheapest countries in this respect, however the issue is relatively high temperature there pushing the ultimate costs of hardware maintenance to the upside. Taking account of temperature one may single out Finland and Sweden where temperature is lower making them the hottest places for China’s miners once they decide to relocate. On top of that Iceland and Norway might be in consideration as well, albeit costs of energy are somewhat more painful.