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Are Oracles the Ticket to Ethereum’s Next Bull Market?

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Ethereum’s recent string of positive performances has reinvigorated a long-standing debate in the crypto community: how will oracles influence adoption and prices?

Oracles: The Gateway to Data

There’s no denying that Ethereum has become the platform of choice for startups and smart contract developers looking to build a crypto-focused business. According to recent data, more than three-quarters of initial coin offerings (ICOs) were deployed using Ethereum’s smart contracts. Other platforms have caught the attention of developers but none have witnessed anywhere near the same adoption as Ethereum.

While blockchains are inherently self-sufficient, the executing logic in any given smart contract cannot do anything outside the blockchain. This means the blockchain cannot interact with existing web services. As Adam Gall aptly notes, “The only way to get data into a smart contract is to pass it in with the transaction. The only way to update blockchain state is to trigger that state change by sending a new transaction into the system.”

Given that some smart contracts may require inputs from real-world events, they need to have a way to communicate with data on the internet. That’s where oracles come into play. In principle, an oracle pattern links real world data that resides outside the blockchain to smart contracts that require data to determine which action to take.

Oracles essentially provide “trusted” data to a blockchain-based smart contract through transactions. In practical terms, oracles are usually web services with built-in functionalities specific to the blockchain. For example, an oracle may retrieve pricing information of a particular cryptocurrency from a website API.

Oracles are important because they can help boost adoption of Ethereum smart contracts. After all, smart contracts that can base decision-making on real-world parameters are more likely to find relevant use cases among consumers, businesses or any other target market. As adoption and utility of Ethereum smart contracts grow, so too does ether’s future price potential.

Cryptocurrency analyst Ian McLeod recently told Forbes that oracles will spearhead ether’s next bull run, which he says could materialize in the final two months of 2018. The analyst put a price target for ether at $500 by end-of-year. While McLeod’s outlook is overly optimistic given the issues currently plaguing Ethereum, not to mention the much wider market slump, oracles are likely to play an important role in the blockchain’s future.

ETH/USD Update

Ethereum has seen an impressive rally over the past seven days, with prices being fueled by a substantial upsurge in trading volume on virtual currency exchanges. Prices backtracked on Thursday, as coin values across the digital currency market faced overbought resistance following a short period of rapid gains.

Ether reached a low of around $213, down from a Wednesday high near $222. The second-largest cryptocurrency by market capitalization has returned a positive 8% over the past week. Ether trade volumes fell to $1.6 billion on Thursday after cracking $2 billion earlier in the week.

While analysts continue to speculate about ether’s long-term potential, short-term price action will be largely dictated by the broader market. Bitcoin cash and XRP have been the major market movers over the past week, which has fueled demand for alternative coins. The looming hard fork of bitcoin cash could have significant implications on the current rally and how investors allocate capital in the coming weeks.

That being said, ether’s recent uptick overcame several major barriers that had thwarted previous rally attempts. Gains above $200 followed by a short-lived rally north of $220 suggest that bullish momentum has returned.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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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4.6 stars on average, based on 673 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Bitcoin

Price Prediction for Bitcoin, Ripple, Ethereum: Crypto Bloody Tuesday Sees Falls that Shake Convictions

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  • The BTC/USD hits a low of $4,212 and eyes $3,500 in the next few days.
  • The XRP/USD panics below $0.41 but recovers $0.45 amid high uncertainty.
  • The ETH/USD marks a trough at $125 and could move below $100.

If Hollywood creates the script of what’s happening on the Crypto Board, they wouldn’t have done any better. When it seemed that the story had a hero called Ripple, untouchable and immutable to his environment, the scene begins where the saving hero on which the civilization of Cryptocurrencies depended falls and exposes its weaknesses.

After a first attempt by the BTC/USD to the $5,000 price level through the American session was rejected, a new attempt hours later has broken forcefully that level and reached $4,600.

We saw the same with ETH/USD, once drilled at the psychological level of $150, it reached $137 in the Asian session.

In the short term, the indicators that we will see in the detailed analysis invite us to think about a possible short-term rebound in the next 24-36 hours. This rebound would initiate the process of rotating the charts in the daily range. However, we are going to see new lows, levels unthinkable two weeks ago.

My personal opinion is that at that point, with practically all hands weak and empty, the strong hands will enter the market with full steam, buying a selection of assets that will probably leave some cryptocurrencies in the mud and lift others’ heads. However, the Crypto board will have changed hands, or whales, forever.

BTC/USD 240-Minutes

The BTC/USD is currently trading at the $4,432 price level, drawing a chart that looks very scary. The drop is extreme and except for a slight recovery after piercing $5,000 yesterday, the comeback didn’t last long, and sellers have come back strongly.

The plummet takes away any level of buying if there is anyone still in the market trying to catch falling knives. With this violence, it is most likely that any rise is merely a closing of short positions than a movement of real accumulation. The price reductions are in their early hours, and there are still a few days left until Black Friday.

Below the current price, the first support for the BTC/USD is at the price level of $3,930 (support for price congestion). The second support awaits at $3,250 (price congestion support) and the third support level at $2,900 (price congestion support). These are levels that represent wild drops in percentage terms and that, if they occur, would raise a whole series of comments about the very survival of this market.

Above the current price, the first resistance to consolidate at the current price level is $4,400 (price congestion resistance). If the BTC/USD manages to hold and close above this level, it will begin to consider it as a support point for the first considerable pull-back of the current bear storm. The second resistance level is $4,918 (price congestion resistance) and it may stop the brief bullish attempt done yesterday. The third resistance level at $5,381, is a confluence of the long-term down channel baseline, a price congestion resistance and a few dollars above the EMA50.

The MACD at 240-Minutes shows a profile of strong bearish inclination and with lines very separated. Momentum continues to be strongly bearish, and it may still take quite some time to see a rebound of some intensity.

The 240-Minute DMI shows how bears have absolute control of the situation. They mark levels above the 50th level of the indicator, a level considered as a healthy trend. On the other hand, the bulls give up and move for minimum standards that, if only for extremes should react to the rise. The ADX responds to downturns by increasing its trend level to levels not seen since December 2018.

XRP/USD 240-Minutes

Ripple is the hope that holds firm the conviction that there is a future in Cryptocurrencies at this time, and seeing it plummet has raised doubts throughout the Crypto ecosystem.

Below the current price, the first support is in the long-term trend line coming mid-September at $0.44. The second support at $0.429 (price congestion support) would take the XRP/USD out of its bullish scenario and into the same bearish chaos scenario as Bitcoin and Ethereum. The third support at $0.413 (price congestion support) would be the last hope for a fall to $0.367 (price congestion support).

Above the current price, the first resistance is at the price level of $0.48 (trend line leading the movement from lows). If the XRP/USD can exceed this level, the second resistance at $0.505 (price congestion resistance). The third resistance level is at $0.584 (price congestion resistance) holds the key to a strongly bullish scenario that would aim to exceed $1 quite easily.

The MACD at 240-Minutes has cut down the zero line, currently losing that important support and forcing to consider bearish movements in the near future. The opening between lines is minimal for now. If the price were to rise it would leave a divergent formation of a strong bullish component. On the contrary, price declines would deepen the bearish side and we could see really strong declines.

The 240-Minute DMI shows us that bears are taking advantage of the ADX line, which would indicate a continuation of the price decline. The bulls decrease their activity but far from the minimum levels. The ADX reacts to the recent declines but in trend levels considered as moderate.

ETH/USD 240-Minutes

The ETH/USD is currently trading at the $132 price level after leaving the minimum fall in support of the $125 price level indicated a few days ago. I don’t consider that the drop is going to stay here, but it is possible that from this level there will be a small rebound in the next 24-36 hours.

Below the current price, the first support in the already commented level is at $125 (support for price congestion). The second support at $94 (price congestion support), would break the mythical barrier of $100 and would cause the headlines of the best horror movies. However, this could only be the headline since terror would be in the third level of support at $80 (price congestion support). In the edited FXStreet Chart you can see more levels.

Above the current price, the first resistance is at $155 (price congestion resistance). The second resistance is at $170 (price congestion resistance). Finally, as a third resistance, the EMA50 at $178 meets the fourth resistance at $180 (price congestion resistance).

The MACD at 240-Minutes shows a very downwardly inclined profile with very open lines. This structure protects the continuity of the descents at least for today.

The 240-Minute DMI shows us a situation similar to that seen in the BTC/USD. The bears go to maximum levels while the bulls retire and show us no intention to enter the game. For its part, the ADX reaches levels not seen since December 2018 and support the continuity of direction and strength of the movement.

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: Damaging Crash Continues, Bounce Likely Ahead

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The cryptocurrency segment continues to trade under heavy selling pressure, and yesterday’s lows weren’t able to hold up the top coins, and the market entered another waterfall decline today. Bitcoin and Ethereum both fell below their next major support zones today in early trading amid a spike in trading volume, and given the deeply oversold momentum readings in their markets, together with the panicky sentiment, a stronger counter-trend move seems likely in the coming days.

That said, the long-term picture is overwhelmingly bearish, with the exception of the still very strong Ripple and Stellar, and traders should only consider very short-term trades with active risk management against the dominant trend. Until at least a confirmed short-term trend change, new lows remain likely in the coming weeks, but given the extent of the plunge, a violent short-covering rally is in the cards.

BTC/USD, 4-Hour Chart Analysis

Bitcoin fell as low as $4250 today, overshooting below the $4450-$4500 support zone in the process, possibly forming a short-term panic bottom after the sharp two-day selloff. Now, holding short positions is risky, from a short-term perspective, and a rally up to the $5000-$5100 zone is possible in the coming days.

Despite that, traders and investors shouldn’t enter new positions here, with the exception of ultra-short-term traders, as volatility is expected to remain very high, and odds favor further new lows in the coming weeks. Further short-term resistance is ahead at $4700, $5350, and $5600 while primary support is found between$4000 and $4050.

ETH/USD, 4-Hour Chart Analysis

Ethereum also spiked below the next major support level near $130 in Asian trading amid the selling panic, and now the third largest coin is hovering near that level, trying to form a swing low similarly to Bitcoin. Given the current sentiment, a bounce towards the $150 is likely, and a choppy consolidation phase could follow the strong momentum move and the initial bounce.

The bearish long- and short-term trends are intact, and despite a likely bounce traders and investors should still stay away from the coin, with the next support zone found near $118 and with further resistance ahead at $160.

Ripple Turns Volatile Amid Crash, but Support Zone Still Holds

XRP/USDT, 4-Hour Chart Analysis

Ripple has been dragged lower by the latest round of the segment-wide crash, and the now clearly second largest coin briefly spiked below the key $0.42-$0.46 long-term support zone. The fact that XRP managed to stay above the lower boundary of the zone is a plus for bulls here, but the short-term picture remains bearish, and it is far from being safe to enter new positions here.

That said, long-term investors should hold on to their positions, with further support levels found near $0.375 and $0.355, and with resistance ahead at $0.51, $0.54, and $0.57.

LTC/USD, 4-Hour Chart Analysis

Litecoin not just hit the $34.50 level as we expected, but it spiked down to $30 amid the rout and now, the coin is deeply oversold from a short-term perspective. A counter-trend move is now likely in the coming days, but again, only very short-term trades should be considered in the coin with strict risk management in the extremely volatile environment. Further resistance is ahead at $38 and $44, while support is found near $28 and $23.50.

EOS/USD, 4-Hour Chart Analysis

EOS entered a freefall in Asian trading, plunging as low as the support zone near the $3.50 level which has been a crucial level for the coin in the past. The coin is now deeply oversold from a short-term perspective, similarly to the majority of the top coins, and a larger bounce is in the cards in the coming days, with resistance levels ahead near $4 and $4.55.

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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4.7 stars on average, based on 399 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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Ethereum

Ethereum’s Correction Hits 90% as Market Cap Falls Below $16 Billion

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The rout of Ethereum intensified Monday, as the cryptocurrency fell further behind XRP in the market cap rankings, extending a brutal year-long correction that has raised serious questions over the protocol’s future.

ETH/USD Update

Ether’s price bottomed at $152.14 on Monday, its lowest since May 2017. The developer’s cryptocurrency is currently trading hands at $157, down 12.3% compared with Sunday.

Aggregate pricing data courtesy of CoinMarketCap presently shows a price-per-coin of $155 for ether. That brings the total market capitalization to around $16 billion, up slightly from an earlier low of $15.8 billion.

Ethereum’s market cap is now $4 billion lower than XRP’s, the so-called banker’s cryptocurrency that has managed to hold up remarkably well relative to its peers. XRP is down 3.9% over the past seven days compared with a 26.3% loss for ether and a 19.6% reversal in bitcoin.

Ethereum’s Existential Crisis

From a price perspective, Ethereum is a shadow of its former self, having lost a staggering 90% from its peak in January. At the time, the smart-contract protocol was riding a relentless ICO boom as hundreds (and eventually thousands) of crypto startups bootstrapped the Ethereum protocol to launch their own token.

While Ethereum’s bearish reversal is not out of the ordinary, the network has faced intense scrutiny over scalability, economic abstraction and the loss of reservation demand in the wake of the ICO boom. The protracted bear market has compounded these negative forces by making Ethereum mining costlier than before.

As Susquehanna recently noted, the business of mining ether via graphic processing units (GPUs) is no loner profitable. For GPU makers themselves, this means a significant loss of revenue.

The crackdown on initial coin offerings is also intensifying with the U.S. Securities and Exchange Commission (SEC) shutting down dozens of projects over allegations of fraud. As of Sept. 30, the SEC’s Division of Enforcement said it was working on more than 225 investigations tied to ICOs.

These factors have not only dampened excitement over Constantinople – the so-called Ethereum 2.0 upgrade designed to address many of the issues plaguing the network – they have apparently undermined ether’s status as a reservation currency. Investors were once keen on acquiring ether tokens to participate in ICOs. But now, with ICO startups raising a meager $145 million in October (down from $1.7 billion in December), ether is no longer seen as a de facto reserve currency.

Nevertheless, there is reason to believe that ether could explode higher over the next three months as bargain hunters and positive fundamental developments create renewed interest in the currency. Ethereum’s development community has set two possible dates for the proposed implementation of Constantinople – Jan. 16, 2019 and Jan. 12. This reasonable timeline could serve as a rally point for market participants evaluating the protocol’s fundamentals.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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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4.6 stars on average, based on 673 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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