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Analysis of Stellar Lumens, Bitcoin, Ethereum, Monero, Litecoin and Ripple

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Cryptocurrencies ready for a third wave?

This is not the time and place for an in-depth lesson on Elliot Wave Theory.  There are numerous websites that offer these lessons freely, and often times the teacher is more astute than I in this art.  If you are a trader, you owe it to yourself to learn this craft, as it is a great tool that is practical and true.  Can you imagine someone calling themselves a chef, but they never learned how to bake bread?  Traders should know some things, and Elliot is one of them.

Per Elliot, all markets move in waves of 5. In a bull market there are three waves up, separated by two waves down.  The down waves are seen by traders as corrections or consolidations.  Wave 3 is typically much larger than either waves 1 or wave 5.  Elliot himself said that wave 3’s are often ‘awe-inspiring’.

I mention all this because I am of the opinion that the past few weeks most altcoins were in the early stages (wave 1) of a bull market.  Wave 1 (for many) has ended and a wave 2 has commenced.  Wave 2 was intense but short-lived.  In many cases (imho), Wave 3 has either already commenced, or will commence soon.  As insanely profitable as wave 1 was for many traders, the next wave might just be a story we will tell our grandchildren.   Stay alert…

Stellar Lumens

I note that XLM has made a series of higher highs and higher lows since it’s large selloff.  This suggests that the trend is once again up.  It’s cheap and could easily double in the near future.

Ethereum Classic

Ethereum Classic is still being cooped up by a 3rd arc.  It will get through it eventually, and we will look at it again when it does. (I see a higher high and a higher low.)

Ethereum

Ethereum turned up sharply and has penetrated the first arc  which has stopped it in the past.  It has since come back to test support.  I would not buy this yet, but wait for a close above the 2nd arc of the pair.

Litecoin

Litecoin is struggling within an arc pair.  When it breaks out it will go higher, but it may not get out soon. It could go lower first.  This is one to watch, not a buy today, imho.

Bitcoin

It is very hard to be bearish about bitcoin.  It seems like as long as the altcoins are in bullish territory there will be buyers for bitcoin.  BUT it is at an energy point and it is above the last setup, and it is very over-extended.  Be very careful if you are leveraged in this coin.

Monero

Monero is pushing it’s way through a 4th arc pair.  It is likely to get through it, but imho it is a good idea to wait for it.  It has “almost” made a higher high and a higher low, but not quite.  So watch it carefully.

Ripple

I see that Ripple, like Monero, has made a higher high and a higher low since it’s selloff.  This suggests the trend has turned up again.  The target here is 0.3.  However, we must be wary of the 3rd arc just above.

Remember:  The author is a trader who is subject to all manner of error in judgment.  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 2 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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27 Comments

27 Comments

  1. lcumiskey

    May 11, 2017 at 7:04 am

    Hi Jim,

    Where do you think Ripple will be by Xmas?

    • Jim Fredrickson

      May 11, 2017 at 10:42 pm

      My charts don’t go that far out. Suffice to say though, higher than it is now 🙂

  2. MSNP05

    May 11, 2017 at 7:43 am

    How to buy ripple in US ?

  3. Gabriel

    May 11, 2017 at 7:55 am

    Interesting to see some evidence from the charts of what many people are hoping for. Fingers crossed and let’s see!

  4. acotph

    May 11, 2017 at 9:16 am

    Hi Jim,

    How would you capitalise on the coming bitcoin correction? selling all BTC for alts?

    Thanks,
    Alex

    • Jim Fredrickson

      May 11, 2017 at 10:43 pm

      Yes, that is what I have done.

  5. nuggets

    May 11, 2017 at 9:19 am

    Stellar Lumens(XLM) same as Stellar(STR) ?

  6. thoth

    May 11, 2017 at 9:20 am

    Thanks for this, I will have to check up on this Elliot waves, Stellar has been doing my head in for months. I hope your analysis is correct.

  7. tank3rs

    May 11, 2017 at 9:51 am

    I think BTC has some way to increase first and I think all Alts will struggle until 2000USD/btc is reached.

    After this the graphs will be very interesting!

    • eko6321

      May 11, 2017 at 1:00 pm

      Yes i am totally agree your comment, since bitcoin not reached 2000usd all altcoin include ETH will struggle.

  8. eko6321

    May 11, 2017 at 1:03 pm

    Hello Jim

    I am still very confusing about ETH do you think price will down to 75~80 usd? What is the best supporting levels? Thanks

    • Jim Fredrickson

      May 11, 2017 at 10:45 pm

      ETH will go up again, in a few days I suppose, but it seems like it’s the small caps time to shine now? XRP, XLM, etc

  9. xrolo24x

    May 11, 2017 at 5:01 pm

    Thank you for the great analysis!

    • Jim Fredrickson

      May 11, 2017 at 10:46 pm

      you are very welcome

  10. unitednoobies

    May 11, 2017 at 6:54 pm

    Hello,

    My question is this:

    What time-frame do you consider as short-term to long-term investment for the cryptos mentions in this article?

    Can you also list out the price range you will be executing as a buy signal?

    Thank you,

    • Jim Fredrickson

      May 11, 2017 at 10:48 pm

      if looking at a 15 minute chart, the setup is measured in a couple days. If a 3 hour, then the setup is looking at a week or so. But it is more complicated than that. Some setups cover a longer time.

  11. Ershad

    May 11, 2017 at 8:40 pm

    Hi Jim,

    Thanks for your article, I wanted to ask should the third wave start, which alt coin do you think would be the most profitable? Also can you still see ETC reaching $15 after it passes $7.5?

    Kind regards,
    Ershad

    • Jim Fredrickson

      May 11, 2017 at 10:50 pm

      I like XLM and XRP today. We will see what tomorrow brings. ETC will not do much until it gets past resistance. There are better investments to be made in the meantime, I think.

  12. thoth

    May 11, 2017 at 11:33 pm

    Awesome woke up to a sweet little XLM trade based on this. You just payed for a years worth of subscription and some. =) be nice if you accepted BTC as payment though.

    • Jim Fredrickson

      May 12, 2017 at 3:46 am

      I’m glad you did well. The best is yet to come. 🙂
      BTC donations are accepted 🙂 1FUq3GB1Q8zz2JpuBr7YHzVBKnaWoxgmya

      • jarosatori

        May 12, 2017 at 3:09 pm

        My subscription is paid as well for some years after following advices in this article. XLM is growing, ripple as well. Great job Jim. 🙂

        • Jim Fredrickson

          May 13, 2017 at 3:11 am

          Thank you for the kind words.

  13. MSNP05

    May 13, 2017 at 2:54 am

    Is it a good time to buy ETH and LTC after the big fall ?

    • Jim Fredrickson

      May 13, 2017 at 3:11 am

      It is selling season for most markets today. Its a good day to play golf, if you are unleveraged, and can be patient….

  14. MSNP05

    May 13, 2017 at 3:19 am

    Thank you for guiding me here…also when the buy time comes I was to be ready to buy XLT…can you tell me how I can buy them as coinbase does not have that ?

  15. iamniks

    May 13, 2017 at 7:53 pm

    Hey Jim, could you share some information about the tool you use for analysis (i mean the gann squre), rules and approaches so everyone here can think of cryptos by himself when you are away 🙂 It seems XRP passed through the energy point without hitting 0.3, am I right?

    • Jim Fredrickson

      May 13, 2017 at 10:11 pm

      My primary tool is the gann square developed by Eduardo Altman of gunner24.com. He has a free ‘howto’ on his site. It is a good place to start…

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Analysis

Forex Update: A Good Time to Accumulate Euros

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On our August 31 Forex Update, we revealed how the Euro is looking strong against major currencies such as the British Pound (EUR/GBP), Japanese Yen (EUR/JPY), and the Canadian Dollar (EUR/CAD). Widening our scope, we discovered that the Euro is also doing well against other major currencies. Other than its recent struggles against the US Dollar (EUR/USD), we can say, with conviction, that the Fiber is one of 2018’s top performers.

In this article, we review EUR’s performance against the Australian Dollar (EUR/AUD) and New Zealand Dollar (EUR/NZD) to show why it may be a good time to accumulate Euros.

Euro/Australian Dollar Analysis

The EUR/AUD pair dropped to as low as 1.16033 in August 2012. This concluded the long bear run that saw the 45.06% devaluation of the Euro against the Australian Dollar from the 2008 high of 2.11197. While the drop may look depressing to long-term investors, seasoned traders pray for plummets like this. They know that fortunes are made by investing when markets crash.

So far, EUR/AUD is rewarding those who bought the crash.

Monthly chart of EUR/AUD

Those who bought the bottom are now up by close to 30%. More importantly, it appears that their investments may be about to significantly grow. EUR/AUD has just broken out of a large ascending triangle pattern on the monthly chart.

In addition, the monthly RSI is threatening to break out from its own symmetrical triangle pattern. From the looks of it, the breakout can happen anytime.

With EUR/AUD reversing its trend, you have one very good reason to accumulate Euros.

Euro/New Zealand Dollar Analysis

The EUR/NZD pair suffered an even longer bear run than the EUR/AUD pair. After posting a high of 2.57906 in February 2009, EUR/NZD went into a long downtrend. The correction drove the pair to as low as 1.38792 in April 2015. In over six years, the Euro lost over 46% of its value against the New Zealand Dollar.

Then again, there are those who make a very good living by buying the bottom. This is risky business. However, a fundamentally strong currency like the Euro is likely to bounce back hard after losing almost half of its value.

Monthly chart of EUR/NZD

If you bought the bottom, you would be in the green by over 26%. If not, well, it’s not too late. As you can see, EUR/NZD has just broken out of an inverse head and shoulders pattern on the monthly chart. This structure is one of the best if not the best reversal pattern in technical analysis.

On top of that, you can see that the monthly RSI is already in an uptrend. It’s been generating a series of higher highs and higher lows for some time now. This is a great signal telling us that bulls have taken control of the market.

With this breakout, EUR/NZD has just launched a new uptrend. This is another very good reason to accumulate Euros.

Bottom Line

Other than its struggles against the mighty greenback, it appears that the Euro is performing brilliantly against other major currencies. Recently, it managed to reverse its trend against the Australian Dollar and the New Zealand Dollar. In addition to its rosy outlook against the British Pound, Japanese Yen, and Canadian Dollar, we believe that now is a good time to accumulate Euros.

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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3.6 stars on average, based on 235 rated postsKiril is a financial professional with 4+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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Analysis

ETFs: What Is The SEC  Really Thinking?

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As a veteran Wall Street type, I was not surprised at Thursday’s SEC announcement on the VanEck-SolidX Bitcoin ETF.  Once again they gave a “no decision”. This pushes the deadline back to December 29, 2018. Don’t be surprised if New Year’s Eve comes and goes and nothing happens before the SEC is forced into a action by the end of February.

Back in August, when the first delay was announced, crypto investors’ reaction was swift and painful.  On Thursday, after a temporary hiccup, prices took a surprisingly positive turn. If we are to believe for just a moment that crypto prices act rationally (or just occasionally) then comes two obvious questions, are crypto ETFs good or bad? Secondly why can’t the SEC come up with an answer?

Never Say Yes

Let’s start with the easy question first: what’s up with the SEC?  Having dealt with this teflon organization for over 30 years, their actions with regard to VanEck-SolidX are the same pattern they have followed forever.  Practically never do they approve anything. Instead they provide two choices: reject or delay. By delaying the VanEck-SolidX application they are accepting the ETF concept in principle but laying out objections that must be corrected.

The result of this regulatory song and dance, don’t expect a decision until the last minute. The reason is that the main issues are not likely to be resolved in time. In fact, I doubt that the ETF proposal gets approval for perhaps as much as another year.  Here is why.

SEC Speak: Obfuscation

According to Jake Chervinsky, attorney for VanEck, the SEC asks “18 multiple part questions covering seven pages.” He adds: “It’s not encouraging to see the SEC ask if the bitcoin futures markets are “of significant size” despite having already concluded last month that they’re not.”

This is a tactic in obfuscation that the SEC loves when an applicant has not provided an adequate response.  In this case there is no objective answer to how liquid a market must be to meet the measure of significance.  Moreover, there is little or nothing that can be done in the short run to create greater liquidity.

The SEC is a political body as much as any agency of the Federal Government.  In raising the issue of liquidity, they can stand behind their role of protecting the public without at the same time hindering public access to a class of assets, even at current depressed levels, is worth $200 billion, more or less.

The SEC Is Right With Their Delays

Does the crypto world really benefit, as this stage of its evolution, by fostering a group of ETFs?  The argument in favor says that this is the way to simply and safely offer the individual investor a way to participate in a diversified portfolio of crypto.  That sounds noble – or is it just something that makes lots of money for those who create them?

But so far, at least from the viewpoint of the SEC, ETF applicants have not created a more secure domain.  More importantly, even if this were not the case, what does the investor gain from investing in a diversified list of crypto when Bitcoin overshadows about every other altcoin?

With nothing against those that believe in the benefits of ETFs, the benefits in current terms is far better for the ETF sponsor that it is for the investor.

Looking just at the math, an individual investor could be just as well off buying Bitcoin, Bitcoin Cash, Ripple, Ethereum and EOS. Admittedly, it is somewhat more complicated finding a place to buy and store Ripple, but with this small portfolio, you cover 75% of the entire crypto asset class. If security is an issue simply go to  blockgeeks.com/cryptocurrency-safe/ and select from a list of hardware wallets.

So whether the SEC gives their approval of VanEck-SolidX in December or February might make a difference if this were 2020 or sometime thereafter.  As for now, it really isn’t critical to the mass acceptance of crypto.

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 105 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

Stocks Pull Back From Highs as Pound Plunges

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After yesterday’s record-breaking session, US stocks once again broadly opened at all-time highs, even as the momentum of the global rally waned. Chinese stocks kick-started the day by extending their relief rally off their 4-year lows and Europe also ticked higher, although the major indices couldn’t hold on to their early gains. Since the US open stocks are drifting lower, but with no major events scheduled for today, a calm afternoon session is likely on Wall Street.

GBP/USD, 4-Hour Chart Analysis

The slight weakness came on the heels of the weaker than expected European flash Manufacturing and Services PMIs, while Theresa May’s Brexit ultimatum also weighed on local equities. The Great British Pound fell sharply on the news too, erasing yesterday’s lofty gains and briefly getting close to the 1.30 level, as the Dollar rallied across the board.

NASDAQ 100 Futures, 4-Hour Chart Analysis

The Nasdaq has been lagging the Dow and the S&P 500 from a short-term perspective and the tech benchmark is once again leading the way lower today. The worse than expected guidance by Micron (MU) from yesterday is weighing on the segment and the market-leading tech giants are also weaker than average.

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

All eyes are still on the bond market, as Treasury yields are near multi-year highs concerning almost all maturities, and with the 10-year yield being very close to signal a trend change in the multi-decade structural downtrend.

While next week’s rate hike by the Fed is near certain, the outlook for the next year will likely be crucial, and given the positive US economic trends and the trade wars’ contained impact, the market’s rate hike expectations are rising across the curve.

Futures and Option Expiries Lead to Choppy Trading

Today is an important day for futures and options traders, as the quarterly contracts are expiring across asset classes, and that has a huge effect on stock and commodity markets as well, with high volumes and volatile trading especially around the key strike prices. Strong trends are rare on these sessions and day-traders should be cautious of sudden volatile spikes in even the most traded assets.

Copper, 4-Hour Chart Analysis

Commodities already experienced volatile swings throughout the day, with especially gold being tossed around the $1200 level that has been in the center of attention in the past weeks. Shorts in copper have been squeezed heavily before the end of the week, with the crucial metal surging above key support with the rally in Chinese stocks, while WTI crude oil retreated from a more than two-month high above the $71 per barrel level as the Dollar rallied.

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 350 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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