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Analysis: Bitcoin Corrects Below $4750 as Ripple Rebounds

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As the SegWit2X hard fork seems less and less a threat to the original Bitcoin blockchain, the segment is settling down and the volatile swings in altcoins calmed down. BTC itself corrected lower after the relentless rise to $4900, and the coin is now trading near the $4750 level, with the short-term picture being slightly overbought. With no major resistance level ahead until $5000, the currency should at least test the all-time high in the coming days, and a break-out to new highs is the most likely scenario.  Key support is still found at $4650, $4400, and near $4150.

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BTC/USD, 4-Hour Chart Analysis

Ripple remains the most active altcoin after the recent strong rally and the following correction, as the coin is still hovering around the crucial $0.26 level, well inside its rising trend. The rest of the majors are little changed since yesterday’s encouraging rebound, with Ethereum trading near $300, and the recently active NEO being stuck around $30. Bitcoin Cash continues to be under strong pressure, while Ethereum Classic is still the other major laggard. Let’s see the detailed short-term analysis.

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Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum continues to trade above the key $285 support after Monday’s spike lower, and the coin is holding on near the $300 level in the quiet environment. The long-term picture remains encouraging, and a rally towards the $330 level is likely in the coming week. The next target above that is at $380 while below $285, long-term support is at $250.

Litecoin

LTC/USD, 4-Hour Chart Analysis

Litecoin is still hovering around the $51 support/resistance level, as it continues to trade relatively weak compared to the other majors, still failing to provide a short-term buy signal. The coin faces strong resistance at $56 and $64, and with the long-term picture still showing oversold readings, the next likely major move is a rally towards the latter. Below $51 strong support is at $44 with the upper boundary fo the long-term base pattern at $38.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash continues to trade in the correction pattern that has been dominant since the late-August top, and the coin is stuck below primary resistance at $300 for now. The long-term trend is still clearly bullish, but further sideways price action is likely as the correction concludes. Support below $300 is at $265, while resistance is ahead at $330 and $360.

Ripple

XRP/USD, 4-Hour Chart Analysis

XRP is still very active, as the short-term uptrend remains intact, and the current correction is in line with a normal counter-trend move. With that in mind, a rally towards the next major target at $0.30 is likely in the coming period, after the correction concludes. Key support levels are now found at $0.24, $0.22, and $0.20.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic is trading in a short-term downtrend and it continues to show relative weakness compared to the other majors. We still advise short-term traders to stay away from opening new positions here, with crucial resistance ahead around the $13.50 level. Support levels are still found at $11 and $9, with short-term resistance now at $12.50.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero remains the most stable major regarding the short-term picture, as volatility is still very low and the coin is trading inside the rather lengthy correction pattern since the end of August. With the long-term picture still being encouraging, the digital currency is expected to break-out from the pattern soon, with key resistance levels ahead at $100 and $125, and support at $80 and $68.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO settled down somewhat near the crucial $30 level – and the 61.8% Fibonacci retracement of its long-term rally – after a highly volatile period. The coin is now trading in a trading range after the furious rally that followed the China-induced crash. The long-term picture remains bullish but more consolidation is likely before the resumption of the rally, and a re-test of the $40 resistance. Another key level is ahead at $34 while support is found at $25.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA is trading inside the key $0.45-$0.48 support zone after the recent decline, but the long-term picture remains constructive, and we still expect a rally back to the $0.64 resistance in the coming weeks, with another level found below that at $0.56. Long-term support is found at $35, but we don’t expect a durable move below $0.45, and the current levels are still attractive for investors.

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Analysis

Daily Analysis: Dow Leapfrogs 23,000 as IBM Beats Estimates

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Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2560 0.13%
DAX 13043 0.35%
WTI Crude Oil 52.02 0.29%
GOLD 1284.00 -0.23%
Bitcoin 5435 -3.15%
EUR/USD 1.1793 0.23%

IBM surged higher today, as the company beat analysts’ expectations across the board, pushing the company’s shares up by more than 10% and helping the Industrial Average to a new all-time high yet again. The other major US indices kept on grinding higher as well for most of the day, despite the strong overvaluation, with the Volatility Index (VIX) still hovering around the 10 level. The NASDAQ and the S&P 500 finished virtually unchanged after a late-session sell-off, while small caps outperformed in the mixed environment.

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DOW 30 Index, Daily Chart Analysis

Global stocks also edged higher, with the Nikkei still leading the way, although the momentum of the move is still weak. The Yen’s weakness was the most apparent trend in currency markets, while the Pound rebounded well, despite the persistent Brexit worries, with the Dollar giving back some of its recent gains compared to its major peers. Gold also remained under pressure after retreating back below $1300 this week, while crude oil rallied on a bigger than expected, hurricane-related decline in US production.

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Gold 4-Hour Chart Analysis

Cryptocurrencies

The major coins had a hectic and bearish session, especially in early trading, as Bitcoin’s overbought conditions coupled with Ripple’s sudden downturn led to a segment-wide decline. Ethereum continued to slip, as the Byzantium-related optimism faded away, but it remained well above the $285 level, and recovered above $300 towards the end of the session. NEO and IOTA still have a negative correlation with the rest of the market, as the two coins surged higher in early trading and gave back their gains during the late-day rebound.

BTC/USD, 4-Hour Chart Analysis

Technical Picture

The DAX closed on a marginal new all-time high again, but the lengthy momentum divergence in the MACD indicator suggests that the steep uptrend continues to be in jeopardy. The low-volatility drift carried the benchmark above the 13,000 level, but a correction towards at least the 12,850 level is likely in the coming days, with another support level at 12,650 serving as a longer-term target. As the long-term uptrend is clearly intact, bears shouldn’t go all-in here but bulls should consider exiting their positions and wait until a correction to trade the long side again.

DAX, 4-Hour Chart Analysis

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
3:30 EUROZONE Mario Draghi Speaks
3:30 UK Average Earnings 2.2% 2.1% 2.1%
14:30 UK Claimant Count 1,700 3,200 -2,800
14:30 UK Unemployment Rate 4.3% 4.3% 4.3%
16:00 CANADA Manufacturing Sales 1.6% -0.1% -2.6%
14:30 US Building Permits 1.22 mill 1.25 mill 1.27 mill
16:00 US Housing Starts 1.13 mill 1.18 mill 1.18 mill
15:45 US Crude Oil Inventories -5.7 mill -4.7 mill -2.7 bill

Key Economic Releases on Thursday

Time, CET Country Release Expected Previous
2:30 AUSTRALIA Employment Change 15,200 54,200
2:30 AUSTRALIA Unemployment Rate 5.6% 5.6%
4:00 CHINA GDP 6.8% 6.9%
4:00 CHINA Industrial Production 6.4% 6.0%
10:30 UK Retail Sales -0.1% 1.0%
14:30 US Unemployment Claims 245,000 243,000
14:30 US Philly Fed Index 22.2 23.8
15:45 US Chicago PMI 58.6 58.9

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Analysis

Technical Analysis: Bitcoin Dumps and Pumps amid Broad Volatile Correction

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The crypto segment has been in turmoil today, as the most valuable coins turned significantly lower, leading to a mini-panic, but they rallied strongly off their slows as buyers stepped in the second half of the session.

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Bitcoin fell as low as $5100, for a 15% correction top-to-bottom, but it is now trading near the prior short-term support at $5400. As the long-term picture remains overbought, investors shouldn’t open new positions here, but traders could play a likely move towards the $6000 level, although we still advise small sizes, as correction risks remain elevated.

BTC/USD, 4-Hour Chart Analysis

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The other majors were also declining in early trading, led by Ripple, with only NEO and IOTA, holding up well during the sell-off.  Both of the latter coins faded away as the rest of the market recovered, but Ripple continued to suffer. For now, the long-term bullish picture is unchanged for the segment, but BTC’s overbought correction could still cause volatility in the coming period. Let’s see the short-term charts after the busy session.

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Analysis

Daily Analysis: Dollar Rally Continues amid Fed Chair Confusion

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Tuesday Market Recap

Asset Current Value Daily Change
S&P 500 2554 -0.09%
DAX 12995 -0.07%
WTI Crude Oil 51.53 -0.66%
GOLD 1287.00 -1.22%
Bitcoin 5652 -0.86%
EUR/USD 1.1751 -0.38%

Yesterday’s trends are mostly continued in financial markets, such as the low-volatility levitation in stocks and the slightly more active trading in currencies with the apparent Dollar strength. The Great British Pound continued to be under pressure amid the amplified Brexit-related worries, but most of the other majors also lost ground to the Greenback.

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The Dollar rally has been fueled by the rise in the odds of some of the hawkish Fed Chair candidates, while overall, the “race” for the positions looks more chaotic than ever. Interestingly, the long-end of the yield curve is refusing to follow the short-term moves, and without the effects of the Fed’s QE program, the yield curve would probably be inverted by now, signaling strong recession risks.

Dollar Index (DXY), 4-Hour Chart Analysis

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The major stock indices are virtually unchanged yet again and even the previously surging Nikkei entered a consolidation, adding to the unusual October lull. Commodities have been quite active thanks to the Dollar’s vigor, with crude oil and gold both turning lower. Oil gave back most of yesterday’s gains as the Iraqi-Kurdish conflict turned out to be less violent than previously feared, and the brief rally fizzled.

WTI Crude Oil, 4-Hour Chart Analysis

Cryptocurrencies

The major coins are having a mixed session at best, as yesterday’s rebound wasn’t durable, and most of the coins turned back lower again. That said, despite the recent choppy price action, the total market cap of the segment is close to its all-time high, even as only Bitcoin is trading near its own record price level.

The optimism regarding Ethereum major Byzantium upgrade wasn’t enough to lift the second most valuable coin today, and the price of the ETH token retreated below the key $330 level after touching $350 yesterday after the upgrade’s lock-in. Ripple and NEO have been among the most active majors today, but with opposing performances, as Ripple fell significantly after yesterday’s break-out attempt, while NEO defied gravity and jumped above the $30 level after a corrective period.

BTC/USD, 4-Hour Chart Analysis

Technical Picture

The S&P 500 is grinding higher despite the overbought short-term momentum readings, and the benchmark is trading very close to its all-time high. The 2550 level is still in focus, but until volatility remains near record lows, the minuscule moves are unlikely to change the technical setup. While a sudden drop in prices could quickly negate the recent break-out, the consolidation could very well lead to further upside, as bulls remain firmly in control, despite the lofty valuation levels.

S&P 500 Futures, 4-Hour Chart Analysis

Key Economic Releases on Tuesday

Time, CET Country Release Actual Expected Previous
02:30 AUSTRALIA RBA Meeting Minutes
10:30 UK CPI 3.00% 3.00% 2.90%
11:00 GERMANY ZEW Sentiment 17.6 20.3 17
12:00 EUROZONE Final CPI 1.50% 1.50% 1.50%
15:15 US Industrial Production 0.30% 0.40% 0.20%
15:15 US Capacity Utilization Rate 76.00% 76.20% 76.10%

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