Bitcoin is breaking below the sideways range it had been in for the past month. It is also taking it down near its 200 DMA. The 200 DMA provided tough resistance for the cryptocurrency back in April, but once it broke above that level, it skyrocketed. Therefore, if (repeat, IF) it breaks below that line in any meaningful way, it will make Bitcoin vulnerable to a more significant decline. (Yes, it’s a bit oversold, but it got A LOT more oversold in the 4th quarter of last year, so it could easily fall a lot further if it breaks below its 200 DMA.)

We think it will indeed go lower. As we’ve said many times in the past, one of the few real items that gives any government its power is the control over its currency. A widely accepted cryptocurrency would take away a lot of that power. This is why both sides of the political aisle are bashing Facebook over their Libra product in our humble opinion.

We believe the incredibly negative reaction in Washington DC to FB’s Libra…is a sign that Bitcoin is going to face A LOT more headwinds than its bulls though it would…in its goal to become a widely accepted currency. This doesn’t mean it will never happen, but we think it DOES mean it will take a very, very, very long time. As this realization makes its way into the mainstream, it should create another substantial downdraft in Bitcoin in our opinion (especially if/when it breaks below its 200 DMA in a meaningful way). Therefore, we would avoid Bitcoin at these levels…at this time.

Matthew J. Maley

Managing Director

Chief Market Strategist

Miller Tabak + Co., LLC

Founder, The Maley Report

TheMaleyReport.com

275 Grove St. Suite 2-400

Newton, MA 02466

617-663-5381

mmaley@millertabak.com

Although the information contained in this report (not including disclosures contained herein) has been obtained from sources we believe to be reliable, the accuracy and completeness of such information and the opinions expressed herein cannot be guaranteed. This report is for informational purposes only and under no circumstances is it to be construed as an offer to sell, or a solicitation to buy, any security. Any recommendation contained in this report may not be appropriate for all investors. Trading options is not suitable for all investors and may involve risk of loss. Additional information is available upon request or by contacting us at Miller Tabak + Co., LLC, 200 Park Ave. Suite 1700, New York, NY 10166.