On 10 August 2018, Rivemont Investments, which manages the Rivemont Crypto Fund (the “only actively managed cryptocurrency fund in Canada”), in a note to investors posted on Facebook, discussed Bitcoin’s recent price action, and stressed the importance of the BTC price staying above the $6,000 support level.
The fund, which launched in December 2017, currently invests in the following cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), XRP, Bitcoin Cash (BCH) and Ethereum Classic (ETC).
In its update for the week ending 10 August 2018, Rivemont explained that “the correction initiated two weeks ago” was due to market players’ overly negative reaction to the news of the U.S. Securities and Exchange Commission (SEC) rejecting (for the second time) the Winklevoss Bitcoin ETF application (i.e. proposed rule change by the Batz BZX Exchange):
“The market is particularly sensitive to any news related to the introduction of a bitcoin-based ETF. As Dan Morehead, CEO of the Pantera Cryptocurrency Fund, says, one could even call the market players' reactions exaggerated. This reality may be due to a lack of understanding of the complexity of introducing such a financial product, or to the large number of projects currently under study by SEC.”
Next, Rivemont noted that a lot of positive news, such as the Bakkt announcement by Intercontinental Exchange (ICE), seemed to be getting ignored due to the cryptocurrency market’s obsession with Bitcoin ETFs:
“Much more positive news was virtually ignored in comparison to the reaction created by these ETF projects. Indeed, ICE, the parent company of the New York Stock Exchange, announced the creation of its cryptocurrency platform named Bakkt last Friday. The company is working with Microsoft to put this new ecosystem for digital assets in place. Strategic partnerships with BCG and Starbucks have already been signed.”
Finally, Rivemont moved to its prediction for the movement of the BTC price in the short term:
“After the rapid correction of the last two weeks, a rebound that could be described as technical rather than fundamental is predictable. This is also the action we can observe since Thursday. It is too early to know if this will translate into a rebound on the strong support around $ 6,000, or if it is only a temporary relief from the current trend…
It goes without saying that the support around $ 6,000 is crucial. A period of consolidation is normal and even desirable after the incredible rise seen in 2017. Any price above this threshold remains positive to our eyes for future price action.”
The “technical” rebound Rivemont talked about seems to be in progress, with Bitcoin currently well above that “crucial” $6,000 support level; at press time, BTC is trading at $6,475, up 2.17% in the past 24-hour period, according to data from CryptoCompare.
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