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Bitcoin Cash Spikes on South Korean Volume

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Bitcoin cash (BCH) resumed its uptrend Friday following a sudden spike in South Korean trade volumes. Recent activity in the Asian country suggests that the bitcoin alternative could gain more exposure in the short term.

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BCH/USD Price Levels

The BCH/USD exchange rate surged above $1,750 on Thursady, where it was still some $800 shy of the all-time high. Prices would later consolidate below $1,700 as markets paced the gains. At press time, BCH/USD was up 6.6% at $1,662.

With the recent gain, bitcoin cash is worth a combined $28.4 billion, according to CoinMarketCap. That puts it third among active cryptos, behind online bitcoin and Ethereum.

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Thursday was bitcoin cash’s second major spike of the month, with more traders backing the alternative blockchain. After months of futility, BCH caught fire in mid-November after the backers of Segwit2x abandoned their planned hard fork. Following an initial spike, bitcoin (BTC/USD) declined sharply.

The complete opposite has occurred in recent weeks, with bitcoin cash tempering its advance and BTC adding thousands en route to multiple record highs. The original bitcoin was down more than $110 on Friday, but continued to trade well north of $8,000.

BCH has put up strong gains in recent weeks, a clear sign that the market has moved to a higher base. The cryptocurrency struggled to make a name for itself after it broke away from the original blockchain on Aug. 1. Based on the latest price action, BCH is making the case for a return to $2,000.

South Korea Factor

Trading activity in South Korea continues to be at the center of bitcoin cash’s rally. The Asian country has emerged as a major player in the global cryptocurrency market, with investors there showing a greater propensity to adopt altcoins.

On Thursday, the country’s Financial Supervisory Service (FSS) said it had “no plans” to monitor the cryptocurrency space because it believes the digital tokens do not represent real money.

“Though we are monitoring the practice of cryptocurrency trading, we don’t have plans right now to directly supervise exchanges,” said Choe Heung-sik, the agency’s chief. “Supervision will come only after the legal recognition of digital tokens as a legitimate currency.”

Positive vibes from South Korea may be partially responsible for the huge upswing in trading volumes tied to BCH. Trading volume in the cryptocurrency has risen above $4.1 billion in the past 24 hours, according to CoinMarketCap. That’s the highest level in nearly two weeks.

Bitcoin cash is also benefiting from Bitstamp’s decision to integrate the cryptocurrency next month “in response to the demand.”Bitstamp is the world’s twelfth largest digital currency exchange, according to Business Insider.

Separately, digital wallet provider Bitwala announced plans to integrate BCH into its platform, a clear sign that the token was gaining wider acceptance. The platform, which has more than 57,000 users, said it will now facilitate storage of BCH as well as money transfers. The team also said it is working hard to integrate mobile BCH wallets in the near term.

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 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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Trading recommendation: Lisk/Bitcoin

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The best way to trade a range-bound market is to buy at the lower end of the range and sell at the upper end. If the range is large and well established, it offers us a good risk to reward objective. We believe that LSK/BTC fits the bill and offers us an attractive opportunity to buy at the support and sell at the resistance.

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Key points

  1. LSK/BTC has formed a large trading range.
  2. Buy at the lower end of the range.
  3. Sell at the upper end of the range.

Weekly chart

LSK/BTC has been trading in a large range of $0.00046 on the lower end and $0.0016 on the upper end. On three occasions, the cryptocurrency pair has bounced off the supports. Similarly, it has returned from the $0.0016 levels thrice. The range is well defined. Currently, price is trying to rebound after breaking below the lower end of the range last week. We believe that a buy at current levels offers us a low-risk and high-reward trading opportunity.

Daily chart

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On December 07, the cryptocurrency pair broke below the support of $0.00046. However, the very next day, it climbed back into the range, which is a positive indication. This shows that the bulls want to keep the range intact. However, the rally from the lows hit a roadblock at the 20-day EMA.

Currently, LSK/BTC is again pulling back towards the lower end of the range. If the support holds, we believe that the digital currency will again rally to the upper end of the range. Therefore, we suggest buying 50% of the desired allocation close to $0.00050 levels. Remaining 50% of the position should be purchased once the digital currency breaks out of $0.00068. The profit objective is a rally to the upper end of the range at $0.0016. The trade should be closed if the virtual currency breaks down and sustains below the lower end of the range. This is a long-term trade.

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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Trade Recommendation: XMR/BTC Pair Throwback

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The XMR/BTC market (Monero) has been in downtrend on the hourly chart after posting a high of 0.0225 on December 6 and failing to hold critical support at 0.02. It went to as low as 0.0145 on December 8 before respecting RSI at 32 where it established support. The market used the new support level to rally and generate one higher low after the other. It recently attempted to reclaim support at 0.02 but was repelled by bears. Currently, the market is trading around 0.019 levels where it appears to have created another higher low.

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Technical analysis shows a large reversal pattern in the hourly chart that can take the XMR/BTC pair to 0.025. Even though the market failed to breach resistance at 0.02, investors should not see it as a failed breakout. What we’re seeing is a throwback which is a temporary retreat in price. Throwbacks are common in breakout plays and are often seen as a bullish signal. The next time the market attempts to breach 0.02 resistance, it has a much better chance of breaking it with conviction.

The strategy is to buy breakout at 0.02 with immediate stop at 0.0189.

Hourly XMR/BTC Chart on Poloniex

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As of this writing, XMR/BTC is trading at 0.018714 on Poloniex.

Summary of Strategy

Buy: breakout at 0.02

Target: 0.025

Stop: move below 0.0189 after buying breakout at 0.02.

Disclaimer: The writer 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 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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Trade Recommendation: FCT/BTC Bullish Reversal

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The market reach its all-time high back in June this year when FTC/BTC (Factom) reached 0.01463162. Unfortunately, the pair wasn’t able to sustain its momentum. It created a lower high several days later at 0.01066744 which signalled investors to take profits or cut their losses. As a result, the market tumbled and lost 93.17% in value from its all-time high. Such a tremendous loss would have created an atmosphere of despair in the market. Usually, that’s when the savviest traders come in.

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Technical analysis reveals that the worst is behind the pair. FCT/BTC touched support at 0.001 on the daily chart twice and respected it on both occasions. This is a good indication that the market has found a reliable support level. In addition, hourly chart shows that a large reversal pattern is underway. The pair may have retreated when it nearly touched 0.002, but it generated a new higher low in the process at 0.00156566. The throwback is a bullish signal that enables the pair to gather momentum to break resistance at 0.002.

The strategy is buy on breakout at 0.002. Breach that level and the market reclaims 0.003. Sell that level because it is a strong resistance.

Hourly FCT/BTC Chart on Poloniex

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As of this writing, FCT/BTC is trading at 0.001738 on Poloniex.

Summary of Strategy

Buy: breakout at 0.002

Target: 0.003

Stop: move below 0.0018 after buying breakout at 0.002.  

 

Disclaimer: The writer 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 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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