Connect with us

Analysis

Crypto Road Signs: In Conflict

Published

on

Prices of major cryptocurrencies continue to fall even amid good stock market news and very solid macro indicators.  So, what gives? These days technical analyst are making all the right calls pointing out the ugly downward sloping chart patterns and failed rallies that have formed over the last few months.  

When looking at the chart, keep in mind that there are human emotions driving prices.  It is important to remember that the bulk of global trading is composed of trend followers. In plain english we are talking a group that notoriously buys heavily in rising markets and sells just as heavily all the way down.  There is little in current behavior patterns that pays attention to fundamental value.

Fading Fundamental Interest

The fact that investors are closing their eyes and selling was clearly illustrated in a recent post at Bitcoin.com. Sighting Google Trends and Insights there is evidence that searches for words like Bitcoin, Ethereum, Ripple and cryptocurrency have fallen as much as 80% from peak fourth quarter 2017 levels.  This closely corresponds with the price action across the broad spectrum of currencies.

This simply confirms the pattern of trend following behavior; when the direction of asset prices changes from positive, investors bury their heads.  

A Few Fundamental Indicators To Ponder

The very fact that you are reading this article and taking the time to sort things out, immediately separates you from the crowd of trend followers.  So here are just a few fundamental indicators to ponder. Will any of these restore the luster to crypto overnight? Probably not but over time, fundamentals always win.  So here are a couple of thoughts.

New Money Is Coming

There is lots of media chatter about the billions being raised by hedge funds.  Bravo, this means new investors coming into the crypto market for the first time accompanied by professional managers that spend lots of dough on analysis that pay attention to fundamental factors.  

If Things Are So Bad Why Are ICOs Doing So Well

If you’ve followed the Initial Coin Offerings over the last year, this is an area that has been thoroughly trashed.  ICOs have been called out as “cash grabs” and criticized by tech experts for being “pre product” in other words nothing more than a “White Paper” and a couple of employees.  There have been cases of outright scams that have caught the attention of the media and earned damaging headlines.

For all this, ICO’s raised approximately $3.7 billion in high risk capital in 2017.  Since the start of the crypto price correction last December, ICOs have raised over more than $3.0 billion a 50%+ increase over prior periods.  This is a clear sign of new capital coming into crypto.

Crypto Conferences:  A Measure Of Interest

Woody Allen, the actor, playwright and comedian once remarked, “Those who can’t do, teach and those who can’t teach — teach Gym.”

Those pearls of wisdom could be updated and applied to the latest form of teaching- the crypto conference.  On the website BNT, I counted no fewer than 43 crypto summits, conferences, workshops in the month of March alone. There aren’t that many days in March. And the seats for these conferences are being filled. There is such a thirst for information on blockchains, smart contracts, ICO, regulation. Trend investors may still be feeling the pinch from the crypto price correction but interest from actual industry members has never been higher.  

Speed And Security: Enter PayPal

One of the good things about all of these gatherings is the focus on real world issues. Lately there has been lots of attention on scalability.  Both Bitcoin (The Lightning Network) and Ethereum (The Raiden Network) have their answers to scalability. Yes, but both propose off blockchain transactions and on top of that the crypto community is uncertain when either network will be ready for prime time.  Slow speeds and shaky security concerns are legitimate concerns. Now there is a new twist coming from PayPal.

Trade reports point to a PayPal patent application recently filed for a virtual (cryptocurrency) transaction system designed to address two major issues: speed and security.  Theoretically this could include creating their own payment channel, wallet and crypto exchange.

PayPal’s reach is one of the things that makes their patent application doubly interesting.  The company serves an audience of over 200 million according to the research firm DMR. The company has an impeccable reputation for security, reliability and customer service.

This is both an important measure of fundamental demand for crypto but a big vote for mainstream adoption.

So if you have been patient and read this article to this point I think you will agree that for the moment the crypto road signs point in different directions: prices falling and fundamentals improving.  In the long run fundamental forces almost always win out.

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
22 votes, average: 4.68 out of 522 votes, average: 4.68 out of 522 votes, average: 4.68 out of 522 votes, average: 4.68 out of 522 votes, average: 4.68 out of 5 (22 votes, average: 4.68 out of 5)
You need to be a registered member to rate this.
Loading...

4.4 stars on average, based on 115 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.




Feedback or Requests?

6 Comments

6 Comments

  1. mattslater74

    March 9, 2018 at 8:38 pm

    I agree there will be a new wave of investors. You mention Google searches have dropped but I bet the searches during the peak period were because bitcoin was largely unknown and people were looking for education. Not so much now. Therefore I see little correlatoin between the drop in searches and price. People look at market data before investing not Google search. PayPal is an interesting one. If the patent is approved, PayPal stocks should be a good buy

    • James Waggoner

      March 10, 2018 at 4:32 pm

      I agree, it is all in the interpretation of the data on Google Search. Until AI can show otherwise, the sheer volume of searches may not be the definitive measure. When prices are declining, the negative headlines usually follow. That is where trend followers get their news.

  2. MinerMatt17

    March 9, 2018 at 9:49 pm

    I do see a correlation, as people just want to bury their heads during these times, ad do something else to take their minds off the daily crashes. I know I do this. With that being said, I think we are very close to capitulation, and therefore the bottom, with the all weak hands being removed from the market.

    • James Waggoner

      March 10, 2018 at 4:34 pm

      It may be early to call it capitulation, but somewhere close to that point. That is for sure.

  3. ChookBunny

    March 9, 2018 at 9:49 pm

    When we talk of new money it is always in relation to Hedge Funds, large financial institutions and whales. Is there any understanding of what the opposite end of the economic spectrum is doing. Is there adoption by the worlds 2.5 billion unbanked. Are people in developing, or dictatorship based countries interested, trying or even buying into crypto?

    • James Waggoner

      March 10, 2018 at 4:37 pm

      Sure there are lots of developing countries where payments innovations are taking place. Recently we wrote about QPAGO in Mexico and then there are new systems in Africa. These may not exactly be crypto but they are quite similar.

You must be logged in to post a comment Login

Leave a Reply

Altcoins

Tron Price Analysis: TRX/USD Bulls Hunting for a Potential Charge Back Above Broken Critical Trend Line

Published

on

  • Tron bulls continue to push the price north maintaining a firmer path of recovery.
  • TRX/USD has gained a significant 10% over the past four sessions, moving to its highest level in five days.

TRX/USD: Recent Price Behavior

The TRX/USD bulls have been enjoying some upside relief over the past few sessions now, picking up much pace in the session on Monday. The price managed to move to its highest level  in over seven sessions. Over the past four days, Tron has gained just shy of 10% as the price looks set for recovery following a breach last week of critical support.

An ascending trend line initially supported TRX/USD to the upside, providing exceptional comfort in its move north. The running support had been in play since the back-end of December 2018; however, after a decent run, the bears managed to force a breach. Sellers were able to regain control after the move below, to then see four consecutive days of selling, dropping around 10% in total.

Between 14-15th February, TRX/USD managed to find its feet after what could have very much been a free-fall to the deep south. Daily support came into play around $0.023550, which has provided needed comfort on several occasions already this side of the year. The recovery has been in play since this decent bounce occurred.

Tron Crypto Card

TRON recently detailed more information about its upcoming crypto card. The date of pre-order for the GRID X BitTorrent crypto card is going to be live on 18th February 18 2019 at 8 PM UTC. The GRID crypto card will be a prepaid card that can be topped with TRX in three amounts of 15,000, 50,000 and 100,000. Holders of the cards will be rewarded with BitTorrent (BTT) tokens as part of monthly BTT airdrops.

GRID will be one of two crypto cards built via the Tron network. The first, TronCard, was introduced as a tangible TRX wallet. Both TRX and TRC10 tokens can be stored on the TronCard similarly to a virtual wallet. These mentioned tokens are tokenized assets which would be leveraged via decentralized applications (dApps) via the Tron Network. A QR code feature can also be scanned by users for access to the public key. A physical card will then be able to integrate with the virtual wallet.

Technical Review – TRX/USD

TRX/USD daily chart.

The major challenge for the bulls as detailed above is seen underneath the breached ascending trend line; this is tracking at around $0.027500. Should the bulls manage to break back above this prior acting support, then expect a strong wave of buying pressure to come into play. Further to the north, eyes will be on the $0.03000 area. TRX/USD has not comfortably traded above this price region since August 2018. Once broken down, there isn’t too much in the way of a return back up to $0.04000 territory.

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 124 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




Feedback or Requests?

Continue Reading

Analysis

Crypto Update: Ethereum Leads Second Phase of Rally

Published

on

The major cryptocurrencies are all significantly higher today amid the US market holiday, with most of the top digital currencies also hitting their highest levels in a month. Today’s leaders also took out the highs set during the Litecoin-led spike 10 days ago, and the new swing highs mean that the counter-trend move continues. The negative long-term forces a

Our trend model is still on short-term buy signals in most cases, with the relatively weak Ripple still being the most important exception, but for now, the bearish long-term picture is unchanged, and traders should still use strict risk management strategies, as, despite the rally, bear market rules still apply. That said, investors could hold on to their smaller speculative positions, since the short-term break-out patterns in the segment remain intact, despite the still dominant negative long-term forces.

ETH/USD, 4-Hour Chart Analysis

Ethereum built upon its recent short-term relative strength, surging past the $120 and $130 resistance levels, outperforming its closest peers and leading the way higher for the whole segment. With the new swing high, a new short-term uptrend is established, and our trend model remains on a short-term buy signal, but the long-term trend remains bearish.

The long-term outlook is still negative for ETH, but the coin could test the $160 resistance level, which marked the top of the previous counter-trend move in the coming days. The coin is currently trading near the $145 resistance level, and although it’s slightly overbought from a short-term perspective, the next resistance level could be reached in the coming days.

BTC/USD, 4-Hour Chart Analysis

While Bitcoin has been slightly lagging behind Ethereum during the current rally, it not just recaptured the $3600 support/resistance level, but also managed to rally up to the next key zone near $3850. BTC remains on a short-term buy signal in our trend model despite its relative weakness, but from a long-term perspective, it’s still in a clearly bearish setup.

With that in mind, investors should still expect a move towards the $3250 and $3000 support levels following the current counter-trend move, but traders could still hold smaller, speculative positions in the coin. Further strong resistance is ahead between $4000 and $4050, while below $3600, support is found just above $3450.

XRP/USDT, 4-Hour Chart Analysis

Ripple continues to be relatively weak compared to the broader market, and although it topped the $0.32 level amid today’s broad rally, it’s still only neutral in our trend model even from a short-term perspective. Also, the long-term setup is still hostile for bulls, and the test of the $0.28 and $0.26 levels still seems likely in the coming weeks, with strong resistance levels also ahead neat $0.3550, and $$0.3750.

Litecoin Hits Marginal New High as EOS Soars

LTC/USD, 4-Hour Chart Analysis

LTC haven’t been able to retain its leadership during today’s move, and although it scored a new marginal swing high, ending the short-term correction, the momentum of the current upswing is not convincing. Should LTC form a failed break-out pattern, our trend model will switch to neutral, but for now, the currency remains on a buy signal.

From a long-term perspective, Litecoin is still clearly in a bearish trend, so traders and investors should only consider short-term positions, but for now the break-out remains intact. The next level of resistance is ahead near $51, while is now found near $44, $38, and $34.50.

EOS/USD, 4-Hour Chart Analysis

EOS was also among the relatively stronger coins during the recent week, and after a failed move, today it surged to a significant new swing high, hitting the $3.50 resistance in the process. Our trend model remained on a short-term buy signal, during the recent consolidation, and although traders could take some chips off the table near the $3.50 level, the short-term trend is now bullish.

That said, the bearish long-term forces are still dominant in the market of EOS, and although the coin might test the $4.50-$5 zone, odds still the retest of the bear market low near $1.55 in the coming months. That said, traders could still to their short-term positions, following strict risk management rules, with support now found near $3, $2,80, and $2.55.

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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
1 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 51 vote, average: 5.00 out of 5 (1 votes, average: 5.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.7 stars on average, based on 465 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.




Feedback or Requests?

Continue Reading

Analysis

Euro Obscured By Clouds

Published

on

By Dmitriy Gurkovskiy, Chief Analyst at RoboMarkets

EURUSD got much cheaper last week. For instance, on February 15th the pair reached the lowest levels since November 2018. The local bottom is now at 1.1233. By the end of the week, the major currency pair reached some kind of stability, but the Euro doesn’t look too strong even though economic numbers from the U.S. weren’t very impressive.

The key reason why the Euro plunged was the European Central Bank and its representative Benoît Cœuré, who said that the slowdown in the European economy growth turned out to be more global and much worse than expected. According to his estimations, the inflation in the Area would remain weak, and that’s why one shouldn’t exclude a possibility of a new program to support the European economy.

It’s not a good signal for the Euro Area and its currency. First of all, if Cœuré is allowed to talk about this, then this issue is very important for the regulator. Secondly, the ECB only recently closed its QE program and said that the Euro Area’s economy would no longer require any support. Discussing other possible tools and mechanisms, such as TLTRO (targeted longer-term refinancing operations), indicates that the European economy is starting to experience first signs of a slowdown, which is confirmed by recent statistics. However, in reality, things may be much worse.

In this light, weak readings from the U.S., such as as December retail sales (-1.2% m/m, much worse than expected) and January Industrial Production (-0.6% m/m, neutral market expectations) were out of investors’ eye. It’s bad for the USD, but the current situation with the Euro is much worse.

From the technical point of view, EURUSD is breaking the current descending tendency in the H4 chart and starting a new correction. Why is it possible to talk about growth right now? First of all, there is a convergence on the MACD in the H4 chart. Secondly, the price has broken the resistance line of the previous two-week downtrend. As for possible targets of this correction, they may be at 1.1341 and 1.1374 (38.2% and 50.0% fibo respectively). The key support level is the low at 1.1234.

Disclaimer

Any predictions contained herein are based on the authors’ particular opinion. This analysis shall not be treated as trading advice. RoboMarkets shall not be held liable for the results of the trades arising from relying upon 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.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.7 stars on average, based on 30 rated postsHaving majored in both Social Psychology and Economics, I went on to continue my education in post graduate. Later I worked as a team lead of a tech and fundamental analysis lab in the Applied System Analysis Research Institute. This helped me to acquire all necessary skills and experience to become a successful trader and analyst, as well as a portfolio manager in an investment company. I'm a pro in the financial field and the author of articles for various international media. I also hold the position of Chief Analyst at RoboMarkets.




Feedback or Requests?

Continue Reading

Recent Posts

A part of CCN

Hacked.com is Neutral and Unbiased

Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

Trending