Bitcoin technical indicators turn bullish as the economy expands and oil reserves raise inflation concerns
Rob from Digital Asset News covers Bitcoin's moving average crossover signals, ETF inflows, corporate Bitcoin buying, and macroeconomic data including ISM services and oil reserve warnings.
Summary
Rob from Digital Asset News opens with an overview of Bitcoin's current price action around $85,000–$86,000 and the broader crypto market cap at $3 trillion. He focuses on a key technical development: Bitcoin's 50-day simple moving average is crossing above bearish levels, a signal not seen in over a year, which he argues will drive additional buy pressure. He reviews Bitcoin ETF inflows, Strategy's (MicroStrategy's) continued accumulation of 848,000 Bitcoin, and MetaPlanet's strategy of selling 10,000 BTC during Q3 and buying back 11,000 BTC — netting 1,000 Bitcoin, though at a higher average repurchase price. On the macro side, ISM services came in at 54.9 — slightly below expectations but still indicating expansion — while the US Energy Secretary and Saudi Aramco's CEO issued conflicting signals on oil supply, with Aramco warning that global emergency reserves cover less than two months of demand. Rob closes with a warning about IRS letters going out to crypto holders regarding unreported activity.
Key Takeaways
FULL TRANSCRIPT
Bitcoin Price Action and Moving Average Signals
Rob: The moving averages are telling the tale for Bitcoin, and we're starting to see some pretty good movements in the long term. What's also helping quite a bit is the macroeconomics, as the economy expands. Today's a pretty good day — I love these days. These are great because we can actually come in and say, "Hey, these are good things. Good things are happening." We like to see the positivity, because again in the bear markets we've all done the difficult thing, which is to buy when everybody was saying to hold out, to wait, because things are going to go lower and lower and lower. Of course, we didn't listen, and this is why we get these rewards.
Today we can see that Bitcoin is doing pretty well at $85K. Over the last three months or so it has really told the tale of what is happening. We were at $60K for quite a bit of time. We had a nice little run-up in August around $75,000–$77,000. Then we had another run-up again towards the end of September. And now we've been maintaining around this $86,000–$85,000 level.
As a reminder, we're taking a look at the entire market cap of crypto and digital assets — we're at three trillion dollars. Three trillion is a pretty big thing and we're running away with it. Things are looking pretty good.
If we actually take a look at altcoins over the last 30 days, some of the smaller names are running up pretty high. Zcash, as everybody's been talking about — who knows what kind of things are going on behind the scenes — is up almost 28% in 30 days. But take a look at this one: Cardano, 21% up in 30 days. Congratulations, Cardano holders. And wow, look at Near Protocol — 128%. I'm very impressed with them actually being able to get back that $3.8 million that they were hacked from Intents. Tip of the hat to the organization for doing the tough stuff and getting their funds back.
The Key Bullish Technical Signal
Rob: What we're talking about today are the actual signals. I'm not a big TA person — I know some of you are, and that's fantastic. I'm just not really keen and locked into it. But it doesn't matter, because the TA is what people will see and say, "Okay, the technical analysis says we are going up. I'm going to keep buying." That means there is more buy pressure, and people are going to follow this all the way to Valhalla. So if this works out, fantastic.
This was a nice article from CoinDesk stating that Bitcoin is about to get a major bullish signal it hasn't had in over a year. What they're talking about — there are two things we've looked at as far as technicals, which is the moving average. I do agree with a lot of people that anything below the 200-week simple moving average was a great time to buy, historically. You can see that the Bitcoin price was below $60,000, $61,000, $58,000, and so on. Now as of today we are above the 150-week moving average, and we're just about to get to the 100-week moving average, which is around $89K, because we're teetering on the $86K level. And then the 50-week — you can see we've actually gone above that as well.
But what this article was talking about, and what a lot of the TA people are looking at, is the moving average for the daily. As the 50-day simple moving average starts to cross over the bearishness — we can see the 200-day simple moving average, which we crossed above in August. The 150-day was pretty much the same thing, around $70,000–$71,000. The 100-day followed. And now we are at the 50-day simple moving average that people are saying, "Look, we are above the bearishness that once was. We're going to keep moving on." I can tell you that's so much the better. That's great, because again we did the tough stuff during the bear market.
Rob's DCA Track Record and the Four-Year Cycle
Rob: People will say, "But Rob, aren't you concerned? You think you follow along with the four-year cycles, and you said that in Q4 we should see a pullback." I still believe it. Anything can happen. I don't know if there's anybody out there who is 100% sure of anything. With the different things going on in the world and global economics — which we'll get to in a second — it could definitely happen. However, having said all that, I realize I don't have a crystal ball and it doesn't really work like that.
So thankfully, as I've said here numerous times — and as a quick reminder, because I know people forget about this — I was actually calling for the buying of Bitcoin and digital assets all the way back in June, when we went below that 200-week moving average. Here's just a little quick collage as a reminder, with dates and receipts, just so you know.
This was when the 200-week simple moving average was $62,000 and the Bitcoin price was $59,000. What I was doing was buying every Monday, increasing the buys as we go into these moving averages and these risk levels. For me, this is just a time to execute the plan. We were at 0.22 on the risk metric, which means I had to double up what I bought the previous week because it was above 0.3. This is what we call dynamic DCA. I doubled up, quadrupled up my Bitcoin buy. We were right squarely between the 200-week moving average and the 250 just the day before.
If you just waited for the 200-week moving average and bought underneath that, that's a pretty good time. And you don't have to wait for it — I think in the long run it'll probably be a pretty good investment. As far as buying times, we did go below the 200-week moving average. What I was doing was dollar-cost averaging, and I think in two or three years it'll probably be rewarded.
I bought Bitcoin roughly at 6:30 in the morning — my Cash App just does it. I keep buying every Monday and I'm pretty glad I did. And of course it's Monday, so I buy Bitcoin every single Monday morning. I actually doubled up — well, I misspoke, it was actually a quadruple up — what I purchased the previous week on my usual Monday on the Cash App.
Again, as a reminder, buying at the 200-week moving average at $59,000, $58,000, $62,000 somewhere around there is not a bad thing. I know people were calling me a little bit foolish to buy every single Monday, but that's what I do. Since Bitcoin was going down, I was continuing to increase those amounts every single Monday.
I'm just saying, as a reminder, I know what I called for. I understand that. But in the grand scheme of things, the idea was always to get behind buying Bitcoin because the government will continue to debase the currency, and that's why we should get into assets. I know some people forget about these things because I seem quite bearish at times. This is just a gentle reminder that if you would have followed along with me, it would have been just fine — which I think a lot of you did.
Bitcoin ETF Inflows
Rob: There's some more bullish news if we take a look at the ETFs. Over on the website Dan Teaches Crypto — 100% free, always will be free — we've had a nice little flow over the last 48 hours. I don't have the data for this Monday; I go back to October 2nd. Today I believe is the 5th. But we can see that the flows over time since October 6th show a nice little inflow of capital for Bitcoin.
The last top for Bitcoin was October 6th. So in four days after that, that's when we had a big crash, and you can see people were actually selling off. We tried to make new higher highs, but there actually are lower highs. Looking at it cumulatively: $57.7 billion, $59.8 billion, $62.7 billion. So things are moving in the right direction, and once we start to make these higher highs as far as accumulation and Bitcoin inflows for the ETFs, things are looking pretty good.
As far as inflow days, the biggest inflow day we had was $1.37 billion on November 7th, 2024. Can we get that again? Anybody's guess. The longest inflow streak was 16 days — January 26th to February 16th, 2024. This was when it was just getting started. The biggest single fund day was $1.12 billion — BlackRock, November 7th, 2024. We'll see if that moves forward. Again, anything can happen in Q4.
Strategy and MetaPlanet: Corporate Bitcoin Buying
Rob: However, there's always one person who can help us — Michael Saylor keeps buying. Doesn't matter if it's the top or the bottom, Michael Saylor keeps buying. Now, his company does sell, and we've said that's par for the course — you have to sell to pay off your convertible stock and things like that. But today, to get into October, Strategy reports a $21 billion gain on digital assets in Q3. Last week they acquired 334 Bitcoin and repurchased $176 million of stock. As of October 4th, they hold 848,000 Bitcoin — almost at that door of one million Bitcoin. So that's great that Saylor's doing it, which we've seen before. Yawn. Show me something different.
Okay, here you go — MetaPlanet. I was making fun of MetaPlanet because they were a digital asset treasury going hard into Bitcoin. They're in Japan — a hotel company. But they have bolstered their earnings by buying Bitcoin. Just recently though, they sold Bitcoin and everybody was like, "Oh, that's it. Digital asset treasuries are done." But no, there's a difference between what MetaPlanet's goals are and what Strategy's goals are. Strategy and Michael Saylor are like, "I'm going to buy and hold forever" — which I guess wasn't entirely true because they did sell — but the idea is to keep buying. MetaPlanet's approach is, "You know what? We're going to sell some and then buy back some."
So MetaPlanet bought back 11,000 Bitcoin worth almost a billion dollars by the end of September. After selling 10,000 Bitcoin in the quarter, the company returned with a larger buy, adding 1,000 Bitcoin worth roughly $79 million. The CEO, Simon Gerovich, said, "We held back cash, then we bought back more Bitcoin than we sold. Net, we added a thousand Bitcoin."
That's a great way to do things, right? You want to buy low, then sell at a higher level. So I know what Strategy is doing, and we make fun of them sometimes because they seem to sell the absolute bottom and buy the absolute top. That's fine — they can do whatever they want. It's hard to time these markets. No one can really get it right all the time. But for this one, MetaPlanet did a pretty good job.
MetaPlanet sold the 10,000 Bitcoin during Q3, which is July through September. You can't really tell the exact dates because they don't disclose that in their documentation — it's just listed as within the quarter. So any time between July and September was a pretty good time to sell. As a reminder, that was right around $62,000–$64,000. And then they bought back around $79,000–$80,000. So with the 10,000 Bitcoin they sold during the quarter, they came back with a larger buy. Maybe they did do the exact same thing Saylor did. Oh well — maybe they should have timed it a little bit differently.
ISM Services Data and Economic Expansion
Rob: Moving forward to the macro — this is a pretty good one. ISM came in just a little bit below expectations, but the economy is actually rising. Take a listen to this.
CNBC Reporter: ISM services just crossed, and Steve Liesman has the numbers for us. Steve?
Steve Liesman: Good morning. The ISM services sector coming in at 54.9, just a tenth of a miss from the expectation at 55. That is down from 55.4 in the prior month. Employment ticking up though at 50.1 — that's a good sign, from 47.8 in the prior month. Prices paid surging though: 74 versus 72.6. We had had the highest number since August of '22; now this is the highest number since July of '22. So what we're seeing on the inflation side is percolating up through the service sector. The new orders index just a touch below where it was — 60.9 was the prior, 59.8 is the current number. So the service sector is doing well, because that top-line number being well above 50 does continue to indicate expansion. Looking at the bond complex, down just a tick at 5.29. We're near the highs of the day at 5.30 on the 10-year, the 2-year at 4.81. We get into this number with an expectation for the Federal Reserve: 21% probability they would hike in October — that's obviously way down from where it was — but an 85% probability of a December hike. Back to you.
Rob: So it looks like a rate hike is going to come in December. Although the economy looks to be in a little bit of expansion, especially when we take a look at jobs and the jobs report. It didn't hit the perfect numbers, but things are moving.
Crypto Job Postings Triple
Rob: If we take a look at our sector, crypto job postings tripled — over 1,200 in September. As things start to expand, you're going to want more people to help out with your project, your company, your business. This came from data from a crypto-focused platform called Crypto Jobs List. Companies listed 1,241 positions in September, compared to 886 in August and 382 in July. Isn't that amazing how these listings just tank with the price of Bitcoin? Of course, that's how it works. As things expand and people get more exuberant and bullish, all of a sudden there are monstrous amounts of job postings. That is the relativity of the fear and greed index and the bullish versus bearish stance.
Oil Reserves Warning and Inflation Risk
Rob: Everything seems bullish and it's going to be awesome and fantastic. But I will not allow people to think that there is nothing but blue skies ahead. You have to take a step back and say to yourself, there might be a little bit of caution out there. Take a look at this — this is US Energy Secretary Wright on Face the Nation.
Secretary Wright: We've got increasing supplies coming out of the Strait of Hormuz, and they've continued to rise over the last months, over the last recent weeks. We've got US gasoline production today at a record high. We have demand for gasoline, as we come out of the summer driving season, starting to go down. Similar stories with diesel. Diesel's mostly been affected by the Russia-Ukraine war and also by China's decision not to export diesel or gasoline into the marketplace. And of course, we're living with two refineries that were recently closed — large refineries in California that Governor Gavin Newsom forced the closure of. And frankly, 15 years of policies that have been energy subtraction — trying to close coal plants, close refineries, and shrink our capacity — which means when you get into a crisis, we're just less resilient than we should be.
Reporter: But you still think that in the next four weeks, prices are going to go down?
Secretary Wright: Absolutely. Diesel.
Rob: That may be true, but Saudi Aramco's CEO just warned that the world's emergency oil reserves are almost gone. He says nearly three billion barrels of supply have been lost since the Strait of Hormuz crisis began. Of course, if you believe what was just said by the Energy Secretary, that's going to be fantastic and prices are going to go down. But the roughly six billion barrels still in storage are not practically available — stuck in the wrong location, wrong grade, or tied up by owners.
As a little side note, world usage of oil is over 100 million barrels every single day. What's left in reserve covers less than two months of global demand. How about the United States specifically? As of July 24th, the Strategic Petroleum Reserve held 308 million barrels of oil — the lowest level since 1983. You can see just how things have gone. As Russia invaded Ukraine, we saw a massive dip. Of course, then we relied on the Middle East, and America also produces a massive amount. But as far as the conflict and the amount in reserve, there's not too much moving forward.
So I'm not sure we won't see an uptick in inflation. If we do see an uptick in inflation, then the Fed will probably raise rates, and we'll see how that affects the market.
IRS Letters Going Out to Crypto Holders
Rob: As a public service announcement for everybody here in the States — this is from Clinton Donnelly over at CryptoTax Audit. He says a lot of his clients are getting letters: the 6173 and 6174. What are those? Essentially the IRS is saying, "We have information suggesting you had crypto activity. We believe you may not have fully met your tax reporting obligations. Review your past filings and determine whether anything needs to be corrected." These are going out right now.
So as this is happening, I have a one-two punch for you. First of all, Coin Ledger — it pretty much pulls your information in as a read-only. It doesn't do anything with writing. But the second part, which I just figured out recently, is to use Claude with Coin Ledger. It makes things so much easier. Coin Ledger does a great job, but when you use Claude as an AI — it's only about $20 a month — use those two together. That way you have everything in order, because you're not going to escape that. And that's for everybody, even outside the United States — I'm sure you have taxes for crypto as well.
Live Q&A
Rob: Let's get into the Q&A and answer your questions.
App says the first one: "Remember that the job reports look better because these are those who have two jobs in order to catch up to inflation and maintain the lifestyle, especially in California."
Job numbers are an interesting thing, because people will say the unemployment rate doesn't really represent everything. After a certain amount of time, people who are unemployed or not looking for a job don't get counted anymore. So the unemployment rate is actually much higher. Because of that and the way it's measured, it may be a little bit more skewed. I can definitely see that. That's why macroeconomics and the different reports are good to know — it makes you feel like you understand what's going on. But a lot of this data is just data. Some people cherry-pick it, some people don't. Some people try to get it as accurately as they possibly can. Some are using it for political agendas. It's very difficult.
Mattio says, "I never got to deploy my small cash stack, but dollar-cost averaging saved me."
Me as well. But you know, you have these stacks of cash — there's a lot of things you can do with them. You can wait for the eventual economic collapse like what happened in 2007 or 1989. Or you can maybe buy some distressed assets, or maybe a little real estate, or maybe Bitcoin miners. It just depends on what you want to do. I'm just happy that I was able to dynamically DCA and get into these different positions.
Baylor says, "News is so great that everything is down."
Yes, welcome to crypto. We did have a nice little run-up, right? So over the last 24 hours we're down 0.2%. Yawn. Not a big deal. What about the rest of the markets? BNB is flat. XRP is down. Solana is down. Zcash is down. Hyperliquid up. Monero up seven percent. Cardano doing great. Near — a lot of red. Not too bad though — 1%, 2%, 3%. Those are just the differences from shorts and longs getting liquidated, which affects the markets.
Sell says, "Possible 40% UK capital gains tax coming in this month's budget."
I don't know. There's a lot of things going on in the UK that are just craziness. And of course what's happening in France. Awful. And Spain — didn't know that they were essentially going to go straight up socialism and dissolve parliament. Crazy.
Michael says, "Where's the Claude video located?"
The Claude video is on the second channel, DAIN. Link in the description.
"Hey Rob, how did you decide which AI bot to use on ITrustCapital?"
I consulted with a financial advisor. His name is Bobby. And Bobby told me YOLO. He said to pick the quantum strategy. I said, "Bobby, you're a degenerate loser, so I can't do that." So I went with the quantum alternative strategy and the Solana strategy. And I'm almost ready to deploy some capital for the XRP strategy — just going to put it out there. So that's how I did it, and we'll see if that works out.
Ed's here: "From August 17th, we are way up. Short-term noise."
Very true.
Mim is here: "What is Midnight at now?"
That's a good question. I think I have some of that as an airdrop — I just haven't checked. Let me see. Midnight is up 113% in 30 days. Wow, that's pretty good. I like Midnight. The project is essentially able to add privacy onto most chains that are out there. That's pretty cool. 24 hours — not so great. Seven days — okay. One month — wow. Three months — about the same. I'll take it.
"Hopefully the 40% will not apply to people earning a higher wage than a lot of us."
That's usually how they do it for taxes. They go, "No, no, no — this only affects the rich. You won't be affected." And then the next iteration is, "Well, you know, over a million is fine, but what if we back that up to over $250K per year?" A little bit later: "You know what? $250K seems kind of high. Maybe we should back that up to like $80K." And then: "You know what? But it'll be temporary. The tax will be temporary. We'll definitely take that out." And then eventually: "Let's just tax everybody." That's how taxes work. They're like government jobs. What did Ronald Reagan say? The most permanent thing in life is a temporary government job.