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Analysis: Bitcoin Turns Lower after Monster Rally

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The overbought condition that the most valuable coin built up since the correction low led to a swift correction today after BTC spiked to $4400 on Monday. The coin surged past our range projection target at $4150 before heading lower and completed a 150% rally in 4 weeks. Despite the current dip, the currency remains overbought, and we advise long-term investors to wait for more downside movement before re-entering the coin. That said, short-term traders could still be looking for opportunities in both directions, as volatility is expected to remain elevated, and the coin might test the rising short-term trendline near $3500 in the coming days.

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BTC/USD, 4-Hour Chart Analysis

The recent advance sparked wild speculation regarding BTC with lots of analysts forecasting sky-high target prices, as sentiment got overly optimistic. The other majors were mostly left out of the part, but the current correction is affecting the rest of the market as well. The wave of selling could still push the majors lower, but we expect Bitcoin to be in the center of events, while the rest of the market will likely hold up better. Let’s see the short-term technical picture of the majors.

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Ethereum

ETH/USD, 4-Hour Chart Analysis

ETH dipped below $300, and it is now headed towards the rising trendline currently at $260, still well within the uptrend. Below the trendline further support is found at $250, with resistance ahead at $285 and $330.

Litecoin

LTC/USD, 4-Hour Chart Analysis

Litecoin exited its short-term uptrend this morning, and fell below the $44 level, being dragged lower by the BTC correction. The coin remains in neutral territory regarding the long-term picture and we still expect the currency to head higher and test the prior high in the coming weeks. Support is now found near $42 and $38, with resistance ahead at $46 and $50.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is holding up well amid the selling wave, as the coin is still hovering around the $200 level, inside the dominant triangle consolidation pattern. A break-out of the pattern towards the prior highs is still likely in the coming period, with the long-term range-projection target found below the $260 level.

Ripple

XRP/USD, 4-Hour Chart Analysis

Ripple remains relatively weak compared to the other majors, still following the long-term correction pattern lower. The coin broke below the $0.16 level today, and it might be headed towards a test of the $0.14 level, the lower boundary of the forming long-term base pattern.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic is also moving lower with the other majors, just trading above the lower boundary of the key support zone around the $14 level. The long-term correction pattern remains intact, with strong resistance ahead at $16 and at $18. Investors could still add to their positions here, as the long-term momentum remains neutral.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero is trading right at the $46 support, inside the short-term correction pattern. The coin is still among the strongest majors, and we expect a rally towards the prior highs near $58 in the coming period. Below $46, further support levels are found at $42 and near $37.

NEM

NEM/BTC, 4-Hour Chart Analysis

NEM has been trading in a volatile pattern around the key 0.0000575 level this week, and it got close to the 0.000065 level once again as BTC entered its correction. We still expect the coin to outperform Bitcoin and re-test the 0.00009 level in the coming weeks.

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3 Comments

3 Comments

  1. Chris G

    August 15, 2017 at 9:48 pm

    Took profit on btc at 4400 and eth at 305 – holding back until things cool off. What a summer!

  2. csinkey

    August 16, 2017 at 1:35 am

    Can you include NEO analysis in all your future analysis of the top few major coins? Would be great, think it’s more critical than Monero at this point given valuation if you had a limit on the number you covered. Thanks!

    • FalconX

      August 16, 2017 at 6:23 am

      I support your idea of NEO analysis

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Analysis

Daily Analysis: Dollar Falls, Gold Jumps after Yellen’s Final Move

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Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2668 -0.02%
DAX 13125 -0.45%
WTI Crude Oil 56.65 -0.68%
GOLD 1258.00 1.35%
Bitcoin 16,100 -6.32%
EUR/USD 1.1842 0.73%

The Federal Reserve hiked interest rates as expected today, and although the central bank’s monetary statement was slightly more hawkish than expected, the market’s reaction didn’t reflect the much-anticipated move. The worse than expected Core CPI reading that underlined the low-inflation narrative weighed on the recently strong Greenback, while stocks were unchanged after decision and bonds gained ground as yields retreated.

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EUR/USD, 4-Hour Chart Analysis

The major indices are hovering near their all-time highs with the DOW leading the way higher, hitting a new record for the second day in a row. While volatility Is expected to remain low as we approach the end of the year, market internals and valuation levels are still concerning from a long-term perspective, and stocks outside the US are also negatively diverging. The action in crude oil could be slightly more interesting as the commodity is starting to act in a slightly bearish manner after a grinding multi-month rally.

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WTI Crude Oil, 4-Hour Chart Analysis

The Brexit process is still in the center of attention in Europe, although volatility took a nosedive on the old continent as well, and it’s unlikely that the Christmas period will be much different, given the predictable drop in volumes and trading activity. The date of the next election in the financially and politically troubled Italy has been set to March 4th next year, and the early date caused some turmoil in the countries assets, which dragged the Euro Stoxx 50 lower today, together with the DAX and the other major indices.

Cryptocurrencies

As the total market cap of the crypto-market crossed the incredible $500 billion mark, Ripple, NEO, and Ethereum made headlines with lofty gains in the face of the severely overbought readings elsewhere in the segment. While XRP and NEO are still not overbought from an investment perspective, Ethereum reached our final target for its break-out and triggered a long-term sell signal.

ETH/USD, 4-Hour Chart Analysis

The previously surging IOTA continued its correction, Litecoin consolidated in a relatively narrow range, while Dash, ETC, and Monero scored marginal new highs before turning lower together with BTC. The most valuable coin that has lost some of its momentum “mojo” in recent days fell back below last week’s highs, and that could mark a failed break-out and a start of the deeper correction that seems more and more likely.

BTC/USD, 4-Hour Chart Analysis

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
11:30 UK Average Earnings 2.5% 2.5% 2.3%
11:30 UK Claimant Count Change 5,900 3,300 6,500
11:30 UK Unemployment Rate 4.3% 4.2% 4.35
15:30 US Core CPI 0.1% 0.2% 0.2%
15:30 US Crude Oil Inventories -5.1 mill -3.6 mill -5.6 mill
21:00 US Fed Rate Decision 1.5% 1.5% 1.25%
21:00 US FOMC Statement

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Analysis

Technical Analysis: Volatility on the Rise Again, as Ripple and Ethereum Hit Targets

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Ripple has been the star of today’s session in the cryptocurrency segment, as the only major coin on a long-term buy signal in our trend model continued yesterday’s break-out, and surged to a new all-time high. The currency cleared the $0.425 level that marked the top in May, and after the more than 6-month long consolidation phase, it promptly neared the $0.50 level.

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While the short-term momentum indicators are now stretched, the coin is still in an encouraging long-term setup, although the best period to buy already passed. The coin could be dragged lower in the case of the expected broad correction in the segment, but we expect XRP to outperform in the coming period, with support levels found at the prior high and below that in the range between $0.30-$0.32.

XRP/USDT, 4-Hour Chart Analysis

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Ethereum has been the other top coin on the rise, as the second largest digital currency surged past the final range projection target of the break-out two weeks ago at $685 in the aftermath of the launch of the BTC futures on Monday. The ETH token is now also on a sell signal on all time-frames, and we advise investors and investors to wait for the next major correction to establish new positions. Support levels are now found at $575, $500, $480, and $400.

ETH/USD, 4-Hour Chart Analysis

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Analysis

Technical Analysis: Bitcoin Grinds Higher as Records Tumble in Altcoins

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The historical surge in the segment, which is the second such move this year, continued today, with another round of break-outs in some of the major altcoins and tepid gains for BTC investors. Ethereum, Ripple, Dash, and first and foremost Litecoin was leading the charge, with the recent star LTC topping $300, just after a day of hitting the $200 mark.

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Litecoin defied all odds after reaching extremely overbought readings, and the coin rode the speculative wave, turning exponential, not unlike IOTA and Bitcoin previously. With the coin being stretched in an unprecedented way on all time-frames, investors could even consider selling their core positions at the current levels, as a deep correction is almost granted in the coming period. The first meaningful support level is found at $125, and a re-test of the $100 level is probable during the next major correction.

LTC/USD, 4-Hour Chart Analysis

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Ripple finally ended a long period of relative weakness today, and the only major on a long-term by signal jumped over primary resistance at $0.26 and crossed the $0.30-$0.32 too in the euphoric sentiment. As the coin is not long-term overbought following the 6-month long consolidation, the buy signal in XRP remains intact, with the only major resistance level being found at the all-time high near $0.425.

XRPUSDT/USD, 4-Hour Chart Analysis

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