Line in the Sand

Today is Veterans Day in the USA so volumes could get a bit thin. Markets are scheduled to be open but for the short term traders out there you might want to take the day off. 

All eyes are on crude oil today. After a deep retracement from the highs, it looks like OPEC, led by Saudi Arabia is stepping in to prop up the prices.

The way down from the top has been a very large swing and the break below the 200 day moving average (blue line) seems to have accelerated the decline. 

The Saudis move is a clear indication that they're willing to defend the floor at $60 a barrel. However, this line in the sand could prove difficult to uphold, especially if they don't see cooperation from the other producers.

Pound Under Pressure

The British Pound is under immense pressure this morning after some disappointing Brexit news over the weekend.

It seems that Theresa  May's plan to avoid a hard border with Ireland was rejected both by the EU and her own cabinet. The likelihood of a no-deal Brexit has reared its head once more.

Things aren't looking much prettier on the chart either. The bounce off from resistance last week (purple circle) confirms that we are now in a full-blown descending triangle (yellow lines).

 

Hard Fork Incoming

It should be clear that as confusing as the Bitcoin Cash hard fork may seem, especially for beginners, it is unlikely to have any significant impact on the broader crypto industry, are very slim. However, this drama is a lot of fun to watch and a great exercise for people to increase their knowledge and understanding of how these things work.

The current fight that's playing out is between the two main proponents of BCH (Bitcoin Cash) Craig Wright and Roger Ver. 

For those of you who are new, Bitcoin Cash forked from Bitcoin on August 1st 2017 and though the proponents claim that this is the real bitcoin, it has failed to gain the widespread adoption that they were hoping for.

This graph from bitinfocharts.com shows the number of active wallets on Bitcoin (BTC) VS those on Bitcoin Cash.

Over the weekend, we've seen videos emerging from both Roger Ver and Craig Wright explaining their positions, how this fork came about and what they think will happen next.

Both Roger and Craig are advocating a different version of Bitcoin Cash. The end result will most likely be a split in the network resulting in two different versions of Bitcoin Cash when both upgrades go into effect this Thursday.

For simplicity’s sake, we'll call them Bitcoin ABC (Ver's version) and Bitcoin SV (Wright's version). 

In this video released last week, Ver described Dr. Wright's behavior as less than professional and even published this letter allegedly sent to him from Craig.

Roger went on to say explain that Craig had yet to explain his position or why he wasn't happy with the current roadmap.

Yesterday, Craig struck back by going on the record with famous BTC advocate Tone Vays. In the interview, Craig clarified his belief that the Bitcoin ABC version might have elements that some governments will try to block, hence his opposition

Craig then went on to describe his control of most of the network hash rate in BCH, which could give him a clear advantage in the upcoming war.

However, one thing that Dr. Wright failed to mention is the amount of hash power that is currently allocated to BTC. Crypto miners, for the most part, are not as ideological as Ver and Wright, they're in it for the profit.

At the moment, BCH is only running about 8% of the total SHA256 hashpower.

This makes it very difficult for people to mine BTC. So it wouldn't surprise me if some people who are currently mining BTC would switch a small portion of their hash over to Bitcoin ABC or Bitcoin SV, whichever gives them the best bang for their buck. This might actually be a healthy thing for BTC as well.