Technical Analysis of BTC/USD for October 1, 2020

Crypto Industry News:

The US Securities and Exchange Commission (SEC) has made a big step towards streamlining digital asset clearing in the form of securities, shortening the previous four-step process to three to reduce operational risk for broker-dealers.

The SEC issued a no-action letter stating it would not penalize any Alternative Trading System (ATS) broker that trades digital securities if it complies with the new guidelines.

According to the regulator, several ATS want to use the simplified model in cases where there is no trust over traded assets. Most ATS follows a four-step process: first, the buyer and seller send orders to the Dealership, second, the Dealership matches the orders, third, the Dealership notifies the buyer and seller of the matched transaction, and finally the transaction is settled bilaterally, between themselves or through their guardians. .

However, the Financial Industry Regulatory Authority (FINRA) has called for more clarity on this process in cases where the broker-dealer cannot physically hold the assets.

Some broker-dealers felt that this four-step model put them at too much risk. ATS requested permission to improve the process. According to the no-action letter, this process would include:

Step 1 - Buyers and sellers submit their orders to the ATS, notify their trustees of their orders placed with the ATS and instruct their trustees to settle the trades in accordance with the terms of their orders when the ATS notifies the match trustees at the ATS;

Step 2 - ATS matches the commands;

Step 3 - ATS notifies the buyer and seller and their respective trustees of the matched transaction, and the trustees execute the conditional instructions.

While the document expresses SEC employees' view of the enforcement, and is not a legal ruling, it is further evidence that regulatory oversight of virtual assets is becoming more sophisticated and nuanced.

Technical Market Outlook:

The BTC/USD pair keeps trading inside of the narrow consolidation zone located between the levels of $10,586 - $10,890. The bulls were not strong enough to break back above the trend line and the price started to consolidate horizontally. Nevertheless, the momentum remains positive, but if the bearish pressure intensify, the sell-off might continue towards the level of $10,430 and below. Weekly time frame trend remains up, but to continue the higher time frame trend, bulls must violate the supply zone located between the levels of $11,062 - $11,233.

Weekly Pivot Points:

WR3 - $11,934

WR2 - $11,451

WR1 - $11,105

Weekly Pivot - $10,558

WS1 - $10,238

WS2 -$9,737

WS3 - $9,392

Trading Recommendations:

The weekly trend on the BTC/USD pair remains up and there are no signs of trend reversal, so buy orders are preferred in the mid-term. All the dynamic corrections are still being used to buy the dips. The next mid-term target for bulls is seen at the level of $13,712. The key mid-term technical support is seen at the level of $10,000.


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