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Analysis: Ripple and NEO Soar as Ethereum Classic Breaks Out

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The influx of capital into altcoins continues in earnest, as Ripple added to yesterday’s lofty gains, and it catapulted back to the third place regarding market capitalization. The coin took over Bitcoin Cash after almost doubling in price in a couple of days. XRP is now just below the $0.30 level, although the all-time high of the currency is still 50% higher than the current price. Investors could reduce positions near the resistance zone just above the current level, as a correction back towards $0.25 is likely in the coming days.

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XRP/USDT, 4-Hour Chart Analysis

NEO and ETC also moved out their correction patterns, and now all of the major coins are back in uptrends after the summer bear market. The total value of the cryptocurrency market reached $150 billion as Bitcoin also moved higher after Monday’s spike lower.  The rest of the most valuable coins are also in the green, as the broad rally continues in the segment. While some of the majors are already in overbought territory, there are still opportunities in the sector, as some of the coins are still in the early stages in trend. Let’s see how the technicals are shaping up today.

Bitcoin

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BTC/USD, 4-Hour Chart Analysis

Bitcoin surged back to its prior short-term rising trend channel as buyers stepped in after the steep drop yesterday. The coin remains overbought regarding the long-term picture, and investors should still wait with new positions, while traders could play the volatile swings in both directions. Key support is found at the $4000 price level, and below that near $3800, $3500, and $3150.

Ethereum

ETH/USD, 4-Hour Chart Analysis

ETH is also up today after the dip on the first day of the week, but it remains below Sunday’s high, despite trading within the short-term uptrend. The $330 level remains in focus, with strong support near $300 and $285. Strong resistance is ahead at $380, and we still expect a test of that level, and possibly the all-time high of the token near $400.

Litecoin

LTC/USD, 4-Hour Chart Analysis

LTC continues to trade just above the $46 level, still within a narrow range and a broader triangle pattern. We still expect a break-out in the coming period, with a move towards $50 and the all-time highs near $56. Short-term traders could still wait for a break-out of the triangle before entering into new positions, but the technical picture remains bullish, in all time frames.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is still trading just below the $300 level, inside the short-term uptrend, after the huge weekend move. The currency might be ready for another push higher, although the long-term picture is already overbought, but short-term traders could still enter new positions here. Support levels are found near $266, between $220 and $230 and at $200.

 

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic finally moved out of the previously dominant downtrend today and it is testing the $16 resistance. Should the break-out hold its ground, the next target of the move is at $18, with further resistance levels found at $20 and near $22. Long-term support is found between $13.50 and $14.50. The long-term picture momentum indicators are still in neutral territory, leaving more room higher for the rally.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero breached the $100 level after pushing to a marginal new high following Monday’s break-out. The coin is now back near the prior range projection target at $91, and with the long-term picture turning overbought, investors shouldn’t open new positions here. The coin is also overbought short-term, pointing to a correction in the coming days.

NEM

NEM/BTC, 4-Hour Chart Analysis

NEM is still stuck in the volatile trading range that developed after the coin’s break-out. The coin is hovering around the 0.000065 level with strong support levels near 0.0000575 and 0.000048. Resistance is ahead at 0.000075, and we still expect a move back towards the recent high at 0.00009 as the Bitcoin correction unfolds.

NEO

NEO/USDT, 4-Hour Chart Analysis

The coin moved out of its declining short-term trend after a 50% correction, and rallied through the resistance zone around the $40 level quickly. Neo could be ready to test the prior high soon, but it faces resistant before that near $47.50, which could trigger a short-term correction.

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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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4.5 stars on average, based on 233 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

The Crypto Bull Is Off Of Life Support

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There may be some bad days for cryptocurrencies in the future.  There may even be a few bad weeks. But crypto markets survived the worst shellacking in their brief history.  The soon to be ending month of April is an appropriate time for Mark Twain: “Reports of my demise have been greatly exaggerated”.

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Anytime an asset class gains $100 billion in value over the course just under 30 days, the death watch is over.  Anytime the largest member (bitcoin) gains 30% in value and still ends up being the weakest major performer, the crypto bull market is not only off life support, it is alive and in recovery.

Signs of Better Times

Making highly successful predictions about the direction and magnitude of stocks, bonds or cryptocurrency is a 51% proposition. What this means is that at least 49% of the time, you are going to be wrong.  

At least with stocks and bonds there is a huge database that can be massaged in the hope of  accurately predicting the future. None of that applies to crypto. So here are some of the things that create confidence that the future will be far better than the most recent past.

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Relative Value

When the stock market is near a record high,  interest rates are headed much higher and the market fear index, the VIX, suddenly shoots up, this is a clear sign of an overvalued market for conventional intangible assets.  The same can be said for tangible things like real estate.

After having lost more than half their value in something like 90 days, cryptocurrencies offer comparative value.  Most interesting is how the smallest and most speculative cryptos experienced the best performance. That type of recovery never took place in the post dotcom period.

This is a measure of long term vision investors are applying.  Many of these Gen III projects are little more than white papers and promises at this stage.  This is good to remember the next time someone drags up the notion of a crypto bubble.

Skeptics will point out the thin trading in many of these Gen III names as the underlying reason for their quantum moves.  There is probably some truth here, but simple risk analysis argues in favor of the big familiar names like bitcoin holding leadership.  Crypto investors obviously see things differently.

Cryptocurrencies Can Take A Punch

While watching the favorable price action in recent weeks, there was little obvious impact from the same regulators that contributed to the Q1 price avalanche.  What we are referring to is the April 23rd talk at the MIT Technology Review: Business of Blockchain.

The secession was headlined by an address by Gary Gensler the former chair of the CFTC. The issue at hand: are cryptocurrencies securities and thus regulated by the SEC?  In my mind, Gensler exploded a bomb: Ethereum and Ripple were securities while bitcoin fit the description of a medium of exchange.

Wow, think about this for a second.  If Ethereum was truly a security that could spell a miserable amount of registration work to conform with SEC regs.  While that would be unpleasant, the implications for the thousands of ICO tokens using the Ethereum platform could be far worse.  Fortunately, Gensler isn’t running the SEC but his legal arguments can and probably will be used at some point.

Back in February, when crypto prices were tumbling, Gensler’s comments would surely added to the fear and selling pressure.  On the day of Gensler’s talk, ether rose in price by nearly 7% according to Coinbase while Ripple gained 8%. This shows that cryptocurrency investors are learning to take a punch without losing perspective.

Trade Signs Are Good

We can all pretty much agree that we are relieved when see prices are rising.  However, when price increases are driven by higher volume, that gets technical analysts buzzing. Since the beginning of April, bitcoin transactions have increased 90% and Ethereum by 50%.  While all of this has been happening the median fee for bitcoin has been $0.16 and ETH is an even lower $0.07. While this isn’t exactly free, it is a gargantuan improvement over the $30 bitcoin investors were paying back in December.

A Two Way Street

Not every period will be as profitable as the month of April. Double digit price changes, the hallmark of this market, are part of the drill.  But even after the April rally, cryptocurrencies will still offer better value than the average Nasdaq technology stock.

Featured image courtesy of 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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4.4 stars on average, based on 64 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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Analysis

Ether in Bears’ Hands

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Ether in Bears' Hands

Ether has been doing great over the last few days, but now it’s declining again, trading at around $646, after hitting a 6-week high at $712.43. Over the last session, Ether confirmed at least two bullish trend lines at $665 and $675, which were successfully tested and broken out today. While Ether was above $700 it had some good chances to recover, but now it is quite doubtful.

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The bulls quickly gave up the support at $665 today, and now they need to push the price back to $700. This will be the only chance to hit the $712 high again.

Overall, any price above $675 will help Ether recover, while any price below will make it continue declining. $675 is actually the current resistance, while $712 is another one. $644 is the key support, with a longer term one at $574. The MACD keeps on rising and is in the positives, issuing a buy signal. The Stochastic is, on the contrary, giving a sell signal, despite also being in the positive area.

There wasn’t too much news on Ether over the last few days. Still there was some, and what is worth mentioning is the hack of MyEtherWalet, one of the most popular crypto e-wallets out there. The hackers stole 215 coins, which equals $150,000. The scheme was very simple: the thieves hacked the DNS server and then routed users to a phishing website. The issue was quickly spotted and resolved, but the mere fact the e-wallets are still so much sensitive to hacker attacks is troubling.

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Meanwhile, Massachusetts Institute of Technology has recently published a paper where the scientists analyzed three ways of ‘killing’ Bitcoin. The first one is creating a global Fed based currency, the Fedcoin, that, with the time passing, could eliminate all other cryptos, including BTC. The Bank of Canada actually went this way some time ago, by building a crypto network based on Ethereum. The second way is creating a new crypto based on the largest social networks out there, which could enable pushing out BTC from the market, given the volumes and the number of social media users. Finally, the third way is issuing a large number of cryptos, each designed for a particular purpose. This may also greatly affect the top 10 altcoins, too.

Anyway, the crypto market is still closely watched because of the high degree of anonymity and lack of (or no) regulation.

ETH/USD

Author: Dmitriy Gurkovskiy, Chief Analyst at RoboForex

 

Disclaimer

Any forecasts contained herein are based on the authors’ particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading 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 stars on average, based on 2 rated postsI have two degrees in Social Psychology and Economy. After graduation I worked as the Head of the Laboratory of Technical and Fundamental Analysis of Financial Markets at The International Institute for Applied Systems Analysis. The experience and skills he gained helped me to realize my potential as an analyst-trader and a portfolio manager in an investment company. At the moment I'm a financial expert, writing for various financial media sources and a Chief Analyst at RoboMarkets.




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Analysis

Pre-Market: Stocks Up Slightly After Plunge but Sellers Clearly in Control

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Global stocks continued the bearish trend that initiated last week, while volatility increased significantly yesterday during the US session. The major US indices plunged by more than 2% and dragged global benchmarks lower as well, so suddenly the correction lows are in sight again. The momentum of the move suggests that we will see at least a test of the lows, as the charts continue to show bearish pressures across the board.

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NASDAQ 100 Futures, 4-Hour Chart Analysis

Today, stock futures have been slightly above the lows from yesterday, but the short-term charts are clearly wounded and any bounce should be treated as a counter-trend move here. While significant new correction lows are not guaranteed here, bulls should wait until a short-term trend change rather than guess the bottom, as the risks of a deep downswing are high.

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US 10-Year Treasury Yield, 4-Hour Chart Analysis

The rising trend in Treasury yields is among the catalysts of the move, as we painted out several times, and with the whole yield curve still drifting higher to new multi-year highs, the short-term trend could continue. European stocks are holding up well compared to their US peers, and the Japanese Nikkei is also relatively strong, and all of that could be attributed to one thing, the Dollar’s strength.

EUR/USD at Make-Or-Break Level

EUR/USD, 4-Hour Chart Analysis

Forex markets are very active these days, as the massive move in yields boosted the Dollar, which has been gaining ground compared to all of the majors. The most-watched EUR/USD pair is just above the March low, very close to hitting a 3-month minimum, with only 30 pips of cushion remaining for bulls.

Dollar Index, 4-Hour Chart Analysis

The trend in the Dollar index suggests a breakdown in the coming period, as the broader measure broke out from a range that has been intact for several months. Of course, a hawkish ECB statement tomorrow could save Euro bulls here, but given the bearish positioning regarding the Dollar, the “pain trade” would probably be a strong Dollar rally.

Commodity currencies continue to trend sharply lower, despite the stability in the price of oil, and as we noted several times, the Australian Dollar and the Canadian Dollar have been reliably leading risk assets in the last couple of months, so this trend doesn’t bode well for equities.

The same goes to the negative reaction of the most-watched quarterly earnings releases (Google parent Alphabet, Caterpillar), so for now, caution is the name of the game for equity investors.

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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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4.5 stars on average, based on 233 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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