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Analysis: Cryptocurrencies Edge Higher Without Real Momentum

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Suspicious; that’s probably the best word to describe the rally attempt of the major coins off the China lows this week. The segment definitely stabilized after losing 20% in market cap compared to the all-time highs a couple of weeks back, but last week’s uncertainty is still clearly in the air, and the buying that the most valuable currencies are experiencing is far from being convincing. That said, the most important support levels are holding, with Bitcoin trading well above $4000, and Ethereum also being north of the $300 level, for now.

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ETH is still relatively weak compared to its big brother, trading some 30% lower than its all-time high, which it hit back in July near $400. While all eyes are on the $300 level now, the $285 support is more important from a technical standpoint, and break below that would open up the way towards the $235-$250 zone, which is still a likely candidate for a major bottom.

ETH/USD, 4-Hour Chart Analysis

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The other majors are little changed, so far today, and although BTC is still relatively strong, the recent market leaders, namely Dash, Monero, and LItecoin, failed to regain their strength and remain in the no man’s land between crucial support and resistance levels. With the overall long-term picture still looking overbought, the odds of another leg lower are high, even as most experts dialed down the fears regarding the new Chinese regulations. NEO is still signaling selling pressure in connection with the country, as it failed to follow to follow the market higher and recover above $25. Let’s see the details of the short-term technicals today.

Bitcoin

BTC/USD, 4-Hour Chart Analysis

Bitcoin’s relative strength persists compared to the other majors, although the short-term movement of the currency is less convincing, and it’s still well below the $4400 resistance despite the recent bounce. The short-term trend remains negative, and the $4000 suport level could get back in the center of attention in the coming days, and we still expect a move below that, with further support levels are found near $3800, $3500 and $3150.

Litecoin

LTC/USD, 4-Hour Chart Analysis

Litecoin failed to lead the market higher once again, as it did last week, and it remains inside a correction pattern, with te long0term picture still being clearly overbought. The coin is still above the $64 support/resistance line that held up during the previous legs lower, but we expect the coin to dip below that and probably test the $56 support before the end of the correction.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is trading in line with the broader market, staying well above the key $300 level, but failing to move above the declining short-term trendline and the $360 resistance. The currency is overbought regarding the long-term picture, and a move below $300 is still the most likely scenario for the coming weeks. Support is found at $265 and near $220, and the long-term uptrend is not in any danger right now, but investors should still wait with opening new positions.

Ripple

XRP/USD, 4-Hour Chart Analysis

XRP got very close to the upper boundary of the resistance zone around the $0.22 level, and the declining short-term trednline, still showing relative strength in the current bounce. The coin is neutral regarding the long-term picture, and we expect it to outperform the other majors during the correction phase. Support is still found below the $0.20 level, at $0.18 and near $0.16, while resistance is ahead at $0.26 and around the $0.30 level.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic turned lower off the $16 level yet again, as the coin remains among the weakest majors regarding the short-term picture. The coin is back in the prior long-standing trading range after the surge to the all-time high, and although we still expect a move to new highs mid-term, short-term traders should wait with new positions until a new trend is established. Primary resistance is still at $16, with further levels at $18, and at $23, while support is found at $14.50 and around $13.50.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero is trading in a very narrow range halfway between the $100 and $125 support/resistance levels, as the coin is still overbought concerning the long-term picture, while being stuck in a short-term downtrend. We still expect a move below $100 in the coming period, with a likely test of the $80 level, and possibly the$72 support as well.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO is still trading just above the $22 level, failing to bounce back after the news on the possible Chinese exchange closures. The coin is stuck in a lengthy downtrend since hitting a high above $50, and although the long-term picture is getting oversold, more volatility is expected in the coming weeks. Below $22, strong support is at $16.50 while resistance is ahead near $30 and $40.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA staged a strong rally off it’ slows near $0.48 today, but the declining trend is still clearly intact, and the $0.65 resistance proved too strong for now. The coin has strong support between the $0.45 and $0.48 levels that could provide a base for the next leg higher, but despite the oversold long-term picture a dip towards $0.35 is still in the cards, with the sector being in a broad correction. Investors could add to their positions on the short-term dips, but traders should wait until a new uptrend is established before entering new positions.

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Analysis

Technical Analysis: Correction Continues but Coins Remain Stable

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It’s been another mixed session for cryptocurrency investors as judging by only the price action, the segment suffered losses across the board, but comparing the current sell-off to the January plunge reveals that the majors are much more resilient this time around.

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The largest digital currencies are holding on to most of the gains of the recent weeks, and the price action near the crucial support zones is also encouraging. With all that said, the correction is not over yet, and further losses are still in the cards, but barring a substantial change in price action, the coins will likely continue the rally.

BTC/USD, 4-Hour Chart Analysis

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Bitcoin has been trading around the key $10,000 level all day long, and, so far, a clear break-down has been averted. The short-term momentum indicators are now in neutral territory regarding the most valuable coin, and that could mean that a bottom is close, and investors should already add to their holdings here. Further strong support is found between $9000 and $9200, while targets are ahead at $11,300, $13,000, and $14,250.

XMR/USDT, 4-Hour Chart Analysis

Correlation between the majors has increased during the sell-off, but there are still clear outperformers and laggards, adding to the bullish case. Monero remains among the strongest coins from a technical perspective, trading right at the lower boundary of the bullish consolidation pattern, with the $280 price level holding up for now. The coin faces strong resistance near $300 and $335, but we expect the uptrend to continue with the next target being ahead at $400, while further support is found at $240.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

Pre-Market: Bulls Try to Fight Back after Ugly Overnight Session

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Following the steep late-day downturn on Wednesday, which followed the not-to-hawkish FED meeting minutes, Asian markets and US equity futures continued lower with a vengeance. The very active overnight trading is another sign of the regime change in traditional financial markets that we have been monitoring for the last two weeks, ever since the “Black Monday of 2018”.

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Dow Futures, 4-Hour Chart Analysis

EUR/USD Changing Behavior

The European session brought about an oversold bounce that stabilized markets from stocks to currencies. The EUR/USD pair that has started acting “normally” considering its relationship with US Treasury yields lately, is headed south once again, trading only 0.5% above its recent correction lows after clearly breaking below the rising trendline.

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EUR/USD, 4-Hour Chart Analysis

The bull-trap that we identified a few days ago was the start of the current leg lower, and if the regime change will be persistent, the most traded forex pair could be back to the role of the “risk-on/risk-off” indicator that has been the privilege of commodity currencies in the last couple of weeks.

USD/JPY, 4-Hour Chart Analysis

The Japanese Yen is showing notable strength after its overbought dip, and the primary safe-haven currency could be in for more gains, should the risk-selloff continue. The Yen also gained ground on the common European currency, following the dovish ECB meeting accounts and the misses in the German IFO business climate indicator and the British GDP, which all question the European growth-monetary tightening narrative.

Canadian Dollar in for a Wild Ride

USD/CAD, 4-Hour Chart Analysis

With the Canadian retail sales report and the US crude oil inventory data coming out soon, forex traders should expect sizeable moves in the recently weak currency, while the USD should also be very active during the US stock market session.

All eyes are on Treasury yields again, with the slight correction today helping the bounce in stocks and other risk assets. The Nasdaq could be the motor of a stronger rally on Wall Street, but we wouldn’t bet the house on that, as the short-term technical setup remains bearish, and a re-test of the correction lows is still the most likely scenario for the coming weeks.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

Crypto Update: Bitcoin Tests $10,000 amid Correction

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The altcoin-triggered correction continued in the segment overnight amid the renewed sell-off in global stocks, with a slight bounce in Asian trading and a subsequent dip after the European open. The major coins are all down by more than 5% since yesterday, but for now, the momentum of the move is not worrying, and most importantly the leadership of the rally is holding up relatively well.

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Bitcoin bounced off the key $10,000 level, the $200 support zone held in Litecoin, Monero is still in its consolidation pattern above $280, and only Dash showed deterioration since yesterday, but the long-term picture remains encouraging even in Dash’s case.

LTC/USD, 4-Hour Chart Analysis

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The above-mentioned levels in the technically strongest coins are not even the last line of defense for bulls, as the preceding strong rally left several key levels behind which could serve as the basis of the next leg higher.

Also, we expect the currently negatively diverging coins, led by Ethereum and Ripple, to start showing strength as the short-term momentum reaches oversold territory, and good entry points might be close both for traders and long-term investors.

BTC/USD, 4-Hour Chart Analysis

BTC touched the $10,000 support level, but for now, the technically more important $9000-$9200 zone is not in danger, and the short-term momentum indicators are already neutral thanks to the correction.

That said, more downside is likely in the coming days, but investors and traders should be looking for reversals to enter new positions, as we expect the uptrend to continue, with targets ahead at $11,300, $13,000 and $14,250.

Ethereum Provides a Glimmer of Hope

ETH/USD, 4-Hour Chart Analysis

Although bears are still in control regarding the short-term picture in the second largest coin, this morning ETH didn’t hit a significant new swing low, and that could be the first sign of relative strength, with the $845 support not far above the current price level, and the MACD indicator is already near oversold territory.

Despite the slightly positive sign, short-term traders should remain defensive concerning the weaker coins, while long-term investors should still accumulate the currencies on the dips.

Stay tuned for our detailed technical analysis later on today.

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Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 109 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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