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Analysis of Ethereum, Bitcoin, Monero, Zcash, Litecoin & Ripple

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Ethereum

Ethereum continues to drift downwards as it bounces off 2nd arc support. It still paints a (relatively) bullish long-term picture, because it is on the sunny side of the arc pair, and above the 1×1 Gann angle (blue 45 degree line).

My guess at the present is that this will continue for a couple more days until it hits the 1×1 line at ~ $38. If so, IMHO it will be a good buy. However, if it should close below that point, that would be quite bearish. So, that would be a good place to put a stop loss, (imho).

Litecoin

Litecoin’s chart is a thing of beauty. It responded to the setup like Ginger Rogers in the arms of Fred Astaire. Note hos that advance was largely contained by the 4×1 and 5×1 Gann angles. The correction was (so far) contained by the 2nd arc support.  It seems that there is still a day or two to wait for this coin to finish correcting.

My expectation is that 2nd arc support will continue to hold, but since we never know for sure, a stop loss below the arc might be a wise move.

Bitcoin

In our last column we noted that it was an energy day for bitcoin. Price was sitting below the 1st arc pair and I suggested caution. However, the coin took that energy and burst convincingly through the resistance. While the 2nd arc pair is at $1250, my guess is that a better profit target is the 3rd arc pair at $1440.

Monero

Monero has been trading sideways for a while now. Looking at the bear setup, which seems to be in control, my guess is that there is still a few days of sideways to down movement to contend with. I imagine I speak for all traders when I say that I hate trading sideways markets. Traders get eaten alive if they get caught up in that. In the event of a selloff to ~$17 the 3rd arc pair will be hit, and that might be a good buying opportunity.

Zcash

As mentioned in an earlier column a few days back, Z cash (ZECUSD) is my favorite trade right now. On both long and short term time-frames pricetime has closed above resistance.

As you can see, there are 2 setups in this chart. There is a large 2nd arc (green) that price has just closed above, and also, a smaller, shorter-term setup wherein price just closed above the 1st arc. I have a feeling that this market will go quickly to triple digits. We will see.

Ripple

Ripple is my 2nd most favorite coin at this time. It has broken through short term resistance, and is very close to longer term resistance. I would not be at all surprised if we see a test of the ATH in the next week.

Remember: The author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.

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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5 stars on average, based on 1 rated postsJim has an MBA from the University of Southern California. He has had a long career in both Corporate Finance and IT. Along the way he discovered that trading was a vehicle with great promise, but struggled for a long time without a mentor. After having been knocked down many times and having struggled to get back up, he had an epiphany and realized that geometry was a solution. He shares his experience here. If you do well as a result of suggestions made here, feel free to say thank you :) BTC: 1FUq3GB1Q8zz2JpuBr7YHzVBKnaWoxgmya Follow him on Twitter (@jimfred1276) or email him at jimfred1276 at gmail.




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9 Comments

9 Comments

  1. DamonEvans

    April 8, 2017 at 1:32 pm

    Thanks for the technical analysis. It would be great if we could also have a primer on each crypto coin. What are they about? Why would there be demand for them? Will they still be around in two years etc? While I’m familiar with Bitcoin it would be interesting to hear hacked.com’s thoughts about the alt coins

    • Jim Fredrickson

      April 9, 2017 at 1:27 am

      That would be an interesting article, though I am not the person to write it. My understanding of the technical aspects is sparse. I do however believe they represent the great hope of humankind; to free us from the endless cycle of debt and servitude which fiat currencies have imposed on us in our ignorance.

  2. And

    April 8, 2017 at 5:52 pm

    Thanks Jim!

    • Jim Fredrickson

      April 9, 2017 at 1:28 am

      You are quite welcome. 🙂

  3. parmmd

    April 9, 2017 at 12:02 pm

    What stop would you recommend for Zcash since it has crossed 70 now? Thanks.

  4. lake.landonb

    April 9, 2017 at 1:24 pm

    Man you rock! Glad I subscribed when I did. This article hooked me up

  5. [email protected]

    April 9, 2017 at 11:39 pm

    Hello Jim,

    Can I enter the Zcash now since it’s back from 72 and now trading in the range of 63 since 4 hrs again?

  6. Jim Fredrickson

    April 10, 2017 at 1:36 am

    I remain very bullish on Zcash, ripple and a host of other coins. This week looks like it will be very exciting for crypto traders.

  7. [email protected]

    April 10, 2017 at 2:00 am

    Thanks a lot Jim. You are awesome.

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Analysis

Tesla: A Good Option to Invest

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By Dmitriy Gurkovskiy, Chief Analyst at RoboMarkets

Not so long ago, people only had landline phones that you couldn’t take anywhere, which now looks very inconvenient to modern people. Then, mobile phones appeared, and while you can take them anywhere, you must not forget to charge them regularly. However, charging your mobile has already become as usual as, for example, brushing your teeth.

When it comes to automobiles, modern fuel cars are like landline phones, as you can’t go anywhere without fueling them at a gas station, spending your time and money and planning your day depending on how much fuel you’ve got in your car tank. Electric cars are certainly cars of the future, and charging them would be something modern people are already much used to, as natural as fueling them now. It’s not the question of how much crude oil we still have on Earth; the point is that the progress is moving forward, and combustion engines, which are complex and expensive to maintain, will sooner or later become obsolete. Electric cars, where you don’t have to constantly watch how much engine oil or coolant remains inside, are about to replace the traditional fuel cars.

Tesla, a company founded in 2003, is by far the leader in electric cars production. One of its founders is the famous Elon Musk, an engineer and inventor.

Tesla presented its first electric car concept called Tesla Model S on March 26, 2009, in Hawthorne, CA. On June 22, 2012, after all R&D was completed, it was launched in the market and cost $112,000.

A few months later, the second prototype came in: this time, it was a crossover, Tesla Model X. According to Musk, Model X serial production would start in 2013, and the car would be available in late 2014. These plans proved to be too optimistic, though.

The supply start date was only announced in February 2014, but then postponed to Q2 and Q3 2015, and it fact the first supply was completed In September 2015. By the end of Q3, only 6 Model X cars were sold, each for $80,000.

In 2016, a new car, Tesla Model 3, was announced, and the sales were scheduled for the same year, but then the start date was postponed to 2017. The first Model 3 was actually sold in June 2017, at $35,000.

Since the first model sales start and up to now, the company has been unable to reach any net profit, with all earnings reports showing losses. The company was on the verge of bankruptcy as long ago as in 2008, and only a NASA contract saved it.

Perhaps the famous April 1 joke posted then by Musk was based on this very event.

However, it’s all quite different now.

Looking at the financial indicators of the company over the last 4 years, one can easily see where those losses come from. In 2014, Tesla invested $464M on R&D, while in 2015 they invested $717M, in 2016, $834M, and, finally, in 2017, the R&D cost Tesla $1.378B.

The losses were growing in proportion, but were cut in 2016 thanks to Model X sales. In 2018, the same may occur, as Model 3 is going to be quite popular, so the company may even start receiving profits.

Before 2015, the revenue came from a single model, which was Model S. In 2015, 50,446 cars were sold, with the total gross income of $5.649B.

In 2016, they started to sell Model X, which boosted the total year revenue to $7.728B.

If the company did not invest so much into R&D, perhaps, Tesla Inc. reports would now look far better than they are, but this would not last long, as the competition is also doing something.

When Model S sales started, it cost $112,000, while the average US citizen monthly income was $4,121. While not everyone could afford such a car, the sales went on rising, as Model S targeted mostly the luxury segment.

The next model cost $30,000 less, but was still inaccessible for an average consumer. This is why Tesla decided to release Model 3 at $35,000, much cheaper than the previous models. However, a bad surprise was expecting the company afterwards.

When Model 3 was presented, people could start applying for it with a deposit of just $1,000. By the end of the day, there were already 180,000 applications; three days later, the number already reached 272,000, and by May 2016, it went on rising to reach 373,000.

However, this only led to more expenses, as the company had to upgrade its production infrastructure in order to meet all those applications (the number of those exceeded the total number of cars sold since start).

When Tesla allowed its customers to apply for the new model, its production capacity was just 120 cars per week, while in order to meet all the needs Tesla had to boost it by 60 times, to 7,200 per week. Elon Musk is a go-getter, but this was crazy even for him.

Both investors and customers are already used to Musk not fulfilling his promises on time; this already happened with both Model S and Model X, where the supply date was postponed multiple times. It has not changed much now. By the end of Q1, Musk promised to reach 2,500 cars per week, but in fact was only able to boost it to 1,987. After breaking this promise, Musk said he was going to get 5,000 Model 3 cars per week by the end of Q2, and, curiously enough, this target was reached, according to the report as of July 2.

This news made the stock price go up, but right at the end of the trading session it was again down by 2.3%, as many investors just did not believe the report was true.

With the past experience of Musk’s promises being quite negative, Bloomberg developed an online tool where everyone can track the Model 3 production process by VIN. The news agency sends a request to the National Highway Traffic Safety Administration (NHTSA) website which sends a response on the number of VIN’s registered for Model 3.

However, car manufacturers usually register VIN’s for the whole batch, so the values Bloomberg gets may be a bit higher than they in fact are. Still, according to these stats, the company reached 4,395 cars per week by July 2.

So, in fact, Musk did not fulfill his promise again, and the market reaction was of course negative. However, the key point here is not fulfilling promises but the overall progress that was made over such a short period of time. Just 6 months ago, Tesla produced around 200 Model 3 cars per week, while now this figure is over 4,000. Tesla market cap is already higher than the one of Ford Motor Company and nearly in line with that of General Motors, while those too have over 100 years of experience in car production and sales.

If Tesla is able to maintain the same progress as before, it will produce over 52,000 Model 3 cars by late Q3, which will lead to good Q3 and Q4 reports, while all negative effects of the trade war against China will be void.

Besides, if we also take Model S and Model X sales into account, chances for good reports get even higher.

Reaching 5,000 cars per week is a very difficult task: Tesla even had to place its new assembly line in a tent.

This GA4 (general assembly) allowed the company to boost the production by 20%, and it actually proved to be one of the key decisions.

Meanwhile, Musk says GA3 will be well enough to maintain the production capacity at 5,000 cars per week, while GA4 will help to reach the further target of 6,000 cars. With Tesla products being in demand, investors can be quite optimistic regarding the future of the company and invest more, although they do have some risks.

Tesla is now a leading electric cars producer with relatively accessible prices, but the competition are also looking towards electric car production, which may of course shrink the demand. Other risks include emergencies coming from the autopilot mode Tesla is quite fond of. There is no law regulating the driver responsibility in such cases yet, so the company has to face claims against itself, which lead to Tesla recommending using autopilot only as an additional feature that does not allow the driver to stop watching the road.

Doug Field, a talented engineer, leaving the company after working with it for 5 years is also an important negative factor. Elon Musk says this should not have any influence on the indicators coming in the following quarters, or on the new Tesla cars production.

Technically, there is a clear ascending trend on W1, with the price using the 200-day SMA as a support and constantly bouncing off it. The price has also managed to stay above $300, which may help it go further up, too.

There is no MACD divergence that could stop this growth for now.

Just like before, Tesla looks like a very good option for an investment. Elon Musk may set too ambitious goals, but he achieves them sooner or later. The demand for Model 3 still exceeds the production capacities, with over 400,000 cars pre-ordered, but this will also allow the company to develop new models. As such, the 40-ton truck, Tesla Semi, was already announced to the public in November 2017, and its serial production is scheduled for 2019.

According to some sources, there have already been 1,000 pre-orders, with the deposit increased from $5,000 to $20,000.

Thus, Tesla may become the first company to produce an electric truck in 2019.

 

Disclaimer

Any forecasts contained herein are based on the authors’ particular opinion. This analysis may not be treated as trading advice. RoboMarkets shall not be held liable for trading results based on recommendations and reviews contained herein.

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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4.6 stars on average, based on 4 rated postsHaving majored in both Social Psychology and Economics, Dmitry went on to continue his education in post graduate. He then worked as a team lead of a tech and fundamental analysis lab in the Applied System Analysis Research Institute. This helped him to acquire all necessary skills and experience to become a successful trader and analyst, as well as a portfolio manager in an investment company. Dmitry is a pro in the financial field who authors articles for various international media. He also holds the position of Chief Analyst at RoboForex.




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Analysis

Crypto Update: Technical Setup Unchanged Despite Encouraging Rally

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Cryptocurrency bulls could breathe a sigh of relief on Monday as the secular uptrend in the most valuable coin got saved yet again, as BTC rallied above $6500 for the first time in a week after a low-volume consolidation period just above the $6000 level. All of the majors joined the rally as correlations remain very high in the segment, and the market recovered 10% on average with the total market cap of the coins getting back to $275 billion.

Despite the rally, the top coins are still stuck under key resistance levels, as the recent swing highs are still above the current prices and from a short-term standpoint, the downtrend is still intact. Until a move above the crucial levels, traders should still stay away from opening new positions, as odds continue to favor another test of the June lows.

That said, given the still intact long-term bullish setups in the most important digital currencies and the very negative sentiment that developed thanks to the long declining trend, a short-term trend change could be ahead. A bullish leadership is still yet to form, although Bitcoin’s short-term relative strength is a positive sign.

BTC/USD, 4-Hour Chart Analysis

In BTC’s market, all eyes are once again on the $6750-$7000 zone that has capped the really attempts for a month now, and below that zone, the largest coin remains on a short-term sell signal. As the coin didn’t hit a lower low, a bullish pattern could form in the coming weeks, but until it remains in the current trading range, traders shouldn’t enter the market. Support above the long-term $5850 level is found at $6500, $6275, and $6000 while further resistance is ahead at $7350.

Altcoins Slightly Lagging Behind Amid Broad Rally

LTC/USD, 4-Hour Chart Analysis

The major altcoins are in very similar short-term technical setups, thanks to the strong correlation between the coins, and the most bearish coins, like Litecoin, NEO, Monero, and Dash are still below the key support levels that they violated in June. While the previous lows held up this weekend, investors should still remain defensive with regards to the relatively weak currencies.

LTC/USD, 4-Hour Chart Analysis

That still points to a dangerous long-term setup in the segment, and further technical progress is needed to switch the segment-wide trend. Ethereum remains below the key $500 level, although the coin managed to rally above the $475 level yet again, despite being relatively weak from a short-term perspective compared to BTC.

A rally above $500 would be a very positive short-term sign for ETH, and it could trigger a move to the $555-$575 zone. Primary support is at $450, with further levels at $420, $400, $380, and $360, and below $500 the short-term sell signal is intact.

Featured image from Shutterstock

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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4.6 stars on average, based on 293 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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Analysis

US Opens New Front in Trade War as Oil Plunges

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Financial markets are relatively calm today, with most of the major stock benchmarks being virtually unchanged after the weekend. The energy segment is experiencing the most activity as the volatile correction in crude oil prices continues. Besides that, the Euro’s relative strength is notable, but summer trading conditions remain dominant across the board, with low volumes and choppy intraday price action in most of the asset classes.

Shanghai Composite, 4-Hour Chart Analysis

There seems to be no stopping in the global escalation of trade tensions, as amid the Helsinki meeting between Trump and Putin, the US launched an official probe concerning the retaliatory tariffs of its largest trade partners. The move could deepen the standoff not just between the US and China, but the EU and its other allies as well, and global growth is already weakening, so with further trade troubles growth could grind to a halt.

S&P 500 Futures, 4-Hour Chart Analysis

While global stocks are still well off their highs, and Chinese equities remain in bear market territory, the main US indices are holding on to their recent gains, with the Nasdaq being the by far the strongest benchmark globally. The slightly weaker S&P 500 is also trading at a 4-month high despite trade war fears, and as the first earnings reports of the second quarter were slightly better than expected, with Bank of America beating today before the bell, bulls are still in control on Wall Street.

As for economic news, the much awaited US Retail Sales report delivered a small positive surprise, and last month’s figures were also revised higher. The report helped risk assets during the US session, even as the disappointing Chinese Industrial Production number weighed on investors sentiment earlier on.

Dollar Index, 4-Hour Chart Analysis

Despite the bullish numbers, the Dollar lost a bit of ground against its major peers, although forex markets were less active today than recently and the most traded pairs traded in relatively tight ranges after Friday’s hectic session.

Oil Back Below $70 per Barrel as Commodities Remain Weak

WTI Crude Oil, 4-Hour Chart Analysis

Crude oil prices are sharply lower yet again, with the WTI contract leading the way lower as tight short-term supply conditions got better in Canada, and the general weakness in the global commodity segment infected the market oil. The IMF’s report on weakening global growth, and the chatter about the release of some of the global strategic oil reserves also weighed on oil, and the WTI contract is now at $68 per barrel after trading as high as $75 just one week ago.

Copper, 4-Hour Chart Analysis

Elsewhere in the commodity space, it has been a quiet Monday session, with gold drifting slightly lower after a weak rally in early trading, as selling pressure is still apparent among precious metals. Copper, which also has been suffering in recent weeks as Chinese assets got slammed lower, is still consolidating above the strong long-term support zone that we pointed out last week.

Featured image from Shutterstock

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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4.6 stars on average, based on 293 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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