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Analysis

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.

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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

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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 money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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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

Cryptocurrency Analysis: Ripple Continues Rampage as Litecoin and Ethereum Enter Correction

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Ripple remained in the center of attention in the segment after breaking out to a new all-time high yesterday, and the coin almost doubled in value, climbing above the $0.80 level. The currency concluded a 6-month long consolidation pattern with the move after being the only major on a long-term buy signal in our trend model.

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XRP gave a short-term sell signal today, while turning neutral regarding the long-term setup. Investors now shouldn’t add to their positions, although further gains are still possible, and reducing holdings somewhat is a good idea here. Major support is still found at the prior high near $0.4250 and in the $0.30-$0.32 range.

XRP/USDT, 4-Hour Chart Analysis

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While Bitcoin stagnated, and Bitcoin Cash jumped, Ethereum, Litecoin, Dash, and IOTA has been drifting slightly lower, although the recent gains are still mostly intact, and the basic setup in the segment is unchanged.

Litecoin fell below the $300 level after yesterday’s consolidation, and the coin faced strong selling pressure in the latter half of the session. The currency remains extremely stretched regarding the long-term momentum indicators, and although the short-term uptrend is still intact, a deeper correction is likely in the coming weeks, with key support levels found at $125 and $100, and weaker levels at $260 and $170.

LTC/USD, 4-Hour Chart 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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