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Cryptocurrency Update: Ethereum nears Bitcoin, ETC, Dash

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The seismic shift that has been going on in the cryptocurrency market accelerated in recent days, as Ethereum gained significant ground on Bitcoin. Bitcoin lost more than 10% yesterday after kissing the $3000 level, and falling as far as $2500 intraday. The market cap of ETH is jumped higher in the meantime, as the currency neared $400 and remained strong amid the broad correction during the US session.

Ethereum currently sports a market value of $34 billion, while Bitcoin is down to $43 billion according to Coinmarketcap. The difference is now only 30% compared to Ethereum’s value while it was almost 100% only a week ago.  Several analysts have long been calling for a takeover between the two coins (The “Flippening”) and now it seems that the event might be closer in time than most investors expected, with Bitcoin’s market share now down to 40% of the total crypto-market and Ethereum’s share up to around 30% in the meantime.

What do you think? Will the Flippening happen? And if yes when? Let us know your estimate in the comment section.

Ethereum/Bitcoin

ETH/BTC, Long-Term Analysis

The recent performance of the two majors has been diverging since the end of April, as we can see on the ETH/BTC chart, when Ethereum started a move higher from the 0.04 level. The pair then surged above the 0.10 level in late-May, and moved even higher in the past three days, when ETH surged past the $250 level in the Dollar pair.  With the current number of outstanding coins, the two currencies would be at parity around the 0.177 level.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

ETC also confirmed its relative strength that we pointed out in our recent update, as it is back above the break-out point following the swift correction yesterday in late trading. Ethereum Classic got close to its previous high near $23 after jumping higher on Sunday, and it is trading near $20 this morning after climbing back in the rising short-term trend channel.

Dash

DASH/USD, 4-Hour Chart Analysis

The third major currency that is trading near its weekend highs is Dash that only re-tested the break-out level near $150 on Monday and now it is once again at $180, just 10% off the maximum level. The currency is well inside its long-term uptrend and it still seems to be poised for a move above $200 in the coming days.

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 293 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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3 Comments

3 Comments

  1. Ershad

    June 13, 2017 at 8:26 am

    Hi Mate,

    Anything on Steem?

    Kind regards
    Ershad

    • Mate Cser

      June 13, 2017 at 5:06 pm

      Hi Ershad, we will cover Steem tomorrow!

  2. badjava

    June 13, 2017 at 6:43 pm

    Thanks Mate, I appreciate these frequent updates and one of the primary reasons I subscribe to this site. I try not to trade (although frequently get myself into trouble when doing so) but these articles help in my long term cryptocurrency strategy and understanding the current landscape. I also try to maintain a cryptocurrency ratio and they really help with rebalancing, moving coins into new ICOs I want to invest in, etc. Keep up the great work.

    To answer your question: 100% yes and I think it might happen sooner than we might think but I will the experts guess when. I always wonder what Bitcoin gremlin is hiding around the corner which could have a huge impact on this. It seems the rise in ethereum is as much (or more) attributed to bitcoins complete fail as it is to ethereum’s success.

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Analysis

Crypto Update: Technical Setup Unchanged Despite Encouraging Rally

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Cryptocurrency bulls could breathe a sigh of relief on Monday as the secular uptrend in the most valuable coin got saved yet again, as BTC rallied above $6500 for the first time in a week after a low-volume consolidation period just above the $6000 level. All of the majors joined the rally as correlations remain very high in the segment, and the market recovered 10% on average with the total market cap of the coins getting back to $275 billion.

Despite the rally, the top coins are still stuck under key resistance levels, as the recent swing highs are still above the current prices and from a short-term standpoint, the downtrend is still intact. Until a move above the crucial levels, traders should still stay away from opening new positions, as odds continue to favor another test of the June lows.

That said, given the still intact long-term bullish setups in the most important digital currencies and the very negative sentiment that developed thanks to the long declining trend, a short-term trend change could be ahead. A bullish leadership is still yet to form, although Bitcoin’s short-term relative strength is a positive sign.

BTC/USD, 4-Hour Chart Analysis

In BTC’s market, all eyes are once again on the $6750-$7000 zone that has capped the really attempts for a month now, and below that zone, the largest coin remains on a short-term sell signal. As the coin didn’t hit a lower low, a bullish pattern could form in the coming weeks, but until it remains in the current trading range, traders shouldn’t enter the market. Support above the long-term $5850 level is found at $6500, $6275, and $6000 while further resistance is ahead at $7350.

Altcoins Slightly Lagging Behind Amid Broad Rally

LTC/USD, 4-Hour Chart Analysis

The major altcoins are in very similar short-term technical setups, thanks to the strong correlation between the coins, and the most bearish coins, like Litecoin, NEO, Monero, and Dash are still below the key support levels that they violated in June. While the previous lows held up this weekend, investors should still remain defensive with regards to the relatively weak currencies.

LTC/USD, 4-Hour Chart Analysis

That still points to a dangerous long-term setup in the segment, and further technical progress is needed to switch the segment-wide trend. Ethereum remains below the key $500 level, although the coin managed to rally above the $475 level yet again, despite being relatively weak from a short-term perspective compared to BTC.

A rally above $500 would be a very positive short-term sign for ETH, and it could trigger a move to the $555-$575 zone. Primary support is at $450, with further levels at $420, $400, $380, and $360, and below $500 the short-term sell signal is intact.

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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4.6 stars on average, based on 293 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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Analysis

US Opens New Front in Trade War as Oil Plunges

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Financial markets are relatively calm today, with most of the major stock benchmarks being virtually unchanged after the weekend. The energy segment is experiencing the most activity as the volatile correction in crude oil prices continues. Besides that, the Euro’s relative strength is notable, but summer trading conditions remain dominant across the board, with low volumes and choppy intraday price action in most of the asset classes.

Shanghai Composite, 4-Hour Chart Analysis

There seems to be no stopping in the global escalation of trade tensions, as amid the Helsinki meeting between Trump and Putin, the US launched an official probe concerning the retaliatory tariffs of its largest trade partners. The move could deepen the standoff not just between the US and China, but the EU and its other allies as well, and global growth is already weakening, so with further trade troubles growth could grind to a halt.

S&P 500 Futures, 4-Hour Chart Analysis

While global stocks are still well off their highs, and Chinese equities remain in bear market territory, the main US indices are holding on to their recent gains, with the Nasdaq being the by far the strongest benchmark globally. The slightly weaker S&P 500 is also trading at a 4-month high despite trade war fears, and as the first earnings reports of the second quarter were slightly better than expected, with Bank of America beating today before the bell, bulls are still in control on Wall Street.

As for economic news, the much awaited US Retail Sales report delivered a small positive surprise, and last month’s figures were also revised higher. The report helped risk assets during the US session, even as the disappointing Chinese Industrial Production number weighed on investors sentiment earlier on.

Dollar Index, 4-Hour Chart Analysis

Despite the bullish numbers, the Dollar lost a bit of ground against its major peers, although forex markets were less active today than recently and the most traded pairs traded in relatively tight ranges after Friday’s hectic session.

Oil Back Below $70 per Barrel as Commodities Remain Weak

WTI Crude Oil, 4-Hour Chart Analysis

Crude oil prices are sharply lower yet again, with the WTI contract leading the way lower as tight short-term supply conditions got better in Canada, and the general weakness in the global commodity segment infected the market oil. The IMF’s report on weakening global growth, and the chatter about the release of some of the global strategic oil reserves also weighed on oil, and the WTI contract is now at $68 per barrel after trading as high as $75 just one week ago.

Copper, 4-Hour Chart Analysis

Elsewhere in the commodity space, it has been a quiet Monday session, with gold drifting slightly lower after a weak rally in early trading, as selling pressure is still apparent among precious metals. Copper, which also has been suffering in recent weeks as Chinese assets got slammed lower, is still consolidating above the strong long-term support zone that we pointed out last week.

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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 293 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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Analysis

Crypto Update: Qtum’s Price Contraction Hints at a Massive Bull Run

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Qtum/Bitcoin (QTUM/BTC) is one of the biggest losers in cryptocurrency investing. It shred more than 76% of its value in seven months when it dropped to 0.001192 on July 12. With such a sharp slide, there’s no denying that the market is deep in bear territory. Nevertheless, long-term investors can find hope in the market’s habit of rallying after a deflating bear run.

In this article, we show how Qtum/Bitcoin uses price contractions and oversold conditions to stage massive rallies.

Falling Wedge in the Last Quarter of 2017

QTUM/BTC was bearish in September, October and November of 2017. The pair traded in a wide range between September to late October 2017 while generating lower highs and lower lows. However, the range got more and more tight until December 14. In three and a half months, the pair created a falling wedge.

2017 Fourth Quarter Daily chart of QTUM/BTC

The pair was able to break out of the pattern on December 15 after it recovered from extreme oversold readings. The selling relief combined with price contraction conspired to ignite a rally that rewarded bottom pickers with over 300% profits in less than a month.

Falling Wedge in the First Quarter of 2018

Gravity also works in financial markets. Often, the case is the greater the rise, the harder the fall.

As QTUM/BTC pulled back from its meteoric rise, the pair created another falling wedge structure on the daily chart. The market plummeted until the trading range was so tightly squeezed that there was no more room to go but up. Again, the market flashed extreme oversold readings before breaking out of the pattern.

2018 First Quarter Daily chart of QTUM/BTC

Falling Wedges in the Third Quarter of 2018

History repeats itself; that’s one of the main principles of technical analysis. So far, QTUM/BTC adheres to that tenet. It appears to be creating a third falling wedge as it respects key support of 0.0012. While doing so, it has recently given off extreme oversold signals.

2018 Third Quarter Daily chart of QTUM/BTC

But wait! There’s more!

A broader and more in-depth look at the daily chart of QTUM/BTC reveals that all three falling wedges mentioned above appear to be parts of a massive falling wedge. What’s astonishing is that the narrowest point of this gigantic falling wedge is at key support of 0.0012.

Daily chart of QTUM/BTC

Based on previous price movements, it is not difficult to imagine that this extreme price contraction can be the catalyst of a massive bull run.

Bottom Line

QTUM/BTC is in deep bear territory. However, history tells us that the pair might be out of the woods real soon. The formation of three falling wedge patterns reveal that the market has a habit of rallying after extreme price contraction. More importantly, the emergence of the large falling wedge on the daily chart suggests that QTUM/BTC may be on the cusp of a massive bull run.

 

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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3.7 stars on average, based on 192 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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