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Daily Analysis: Stocks Close One of the Best Octobers Ever

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Tuesday Market Recap

Asset Current Value Daily Change
S&P 500 2572 -0.03%
DAX 13,229 0.09%
WTI Crude Oil 54.59 0.39%
GOLD 1271.00 -0.08%
Bitcoin 6410 4.89%
EUR/USD 1.1649 0.03%

In the face of the most hostile monthly seasonality, equities closed widely higher, concluding the 7th straight month with gains in the US. While today’s momentum was less than stellar, all of the major indices were hovering around their all-time highs, with no sign of fear or any bearish trigger on the horizon. That said the positive price action of the indices is still mostly due to only a handful of mega cap stocks, with a significant portion of the market not joining the party. That, coupled with the striking valuation levels still points to elevated risk levels from an investment standpoint.

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Dow, 4-Hour Chart Analysis

Economic releases and the Bank of Japan took center stage today before tomorrow’s Fed meeting, and the Asian central bank mostly fulfilled expectations, providing only a slight dovish surprise. The US Consumer Confidence index and the Chicago PMI both came in above the consensus estimate, while European numbers were mixed, with the Eurozone CPI report disappointing traders, while the flash GDP reading beating expectations by a hair.

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Despite the busy calendar, currencies had a relatively quiet day, as only the Yen’s weakness was apparent. Commodities had a mixed session, with oil adding to its recent gains while gold drifting lower in the calm environment.

USD/JPY 4-Hour Chart Analysis

Cryptocurrencies

Bitcoin was in the spotlight yet again, as the most valuable cryptocurrency climbed back to new all-time highs, breaching the $6400 level for the first time in history, boosted by the news about the first BTC futures contract on the CME exchange. Altcoins drifted slightly lower in low-volatility, low-volume trading, with only NEO showing increased activity, spiking above the key $30 level again, just to turn lower in the second half of the session. IOTA was the weakest major of the day, losing more than 4%, while Dash, Monero, Litecoin, and Ripple traded in narrow ranges throughout the session, and Ethereum Classic faded after an encouraging session.

BTC/USD, 4-Hour Chart Analysis

Key Economic Releases on Tuesday

Time, CET Country Release Actual Expected Previous
14:30 CHINA Manufacturing PMI 51.6 52.2 52.4
14:30 CHINA Non-Manufacturing PMI 54.3 55.4
14:30 JAPAN BOJ Rate Decision -0.10% -0.10% -0.10%
16:00 JAPAN BOJ Press Confererence
16:00 EUROZONE CPI 1.4% 1.5% 1.5%
16:00 EUROZONE Flash GDP 0.6% 0.5% 0.6%
16:00 CANADA GDP -0.1% 0.1% 0.0%
15:45 US Chicago PMI 66.2 60.2 65.2
16:00 US CB Consumer Confidence 125.9 121.1 119.8

Key Economic Releases on Wednesday

Time, CET Country Release Expected Previous
11:30 UK Manufacturing PMI 55.8 55.9
14:15 US ADP Payrolls 202,000 135,000
16:00 US Manufacturing PMI 59.5 60.8
16:30 US Crude Oil Inventories -1.5 mill 0.9 mill
20:00 US Fed Rate Decision 1.25% 1.25%
20:00 US Fed Statement 0.8% 0.1%

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Analysis

Long-Term Cryptocurrency Analysis: All Majors Stretched as Ripple Finally Breaks-Out

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Although the previous leaders of the rally started to correct or at least consolidate in the wake of the overbought long-term setups, another batch of coins turned exponential, with Litecoin, Ripple, and Ethereum all registering lofty gains this week. Bitcoin, Monero, and Dash have been holding up well, and even drifted to new marginal highs during the period, while Ethereum Classic had a more volatile week, before moving to new highs today.

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XRP left the broad trading range that has dominated its market since May, and surged to new all-time highs while almost quadrupling in the process. As the coin was the only major on a long-term buy signal according to our trend model, and the move triggered a sell signal on Thursday, now all of our tracked coins are on sell signals.

Ripple could be in for further short-term gains but long-term investors should reduce their positions after this week’s spike. Support levels are found Major at the prior high near $0.4250 and in the $0.30-$0.32 range.

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XRP/USDT, Daily Chart Analysis

IOTA, which has been leading the market higher before is down by more than 30% off its all-time high, but given the exponential move before, an even deeper correction is likely in the coming weeks, and investors should wait until a more favorable setup to add to their positions. Strong support is only found at $3 and $1.5, but potential Fibonacci support is at $2.35.

IOT/USD, Daily Chart Analysis

Let’s see how the long-term charts of the other majors look this weekend.

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Analysis

Technical Analysis: Bitcoin Up Again as Altcoins Mixed in Volatile Trading

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Bitcoin is at a new all-time high today, although the momentum of today’s move is far below from what we saw recently, and the coin only managed to reach a marginal record high yet again. BTC is now worth $300 billion, and it is still trading right at the short-term trendline, inside a rising wedge pattern that shows a clear momentum divergence.

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With the short-term trend still being intact further gains are still possible, but as all the majors are overbought from a long-term perspective, we still advise investors to wait for a better buying opportunity before adding to their holdings. Primary support is still found near $13,000, with further levels at $11,300, $10,000, $9000, and stronger levels at $8200 and $7700.

BTC/USD, 4-Hour Chart Analysis

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 XRP entered a volatile short-term correction after its two-day surge after giving a short-term sell signal yesterday, and the coin spiked back towards $0.60 before settling down just below yesterday’s highs. The long-term setup also turned overbought thanks to the almost 300% rally, and now investors should reduce their holdings, even as further gains are still possible. 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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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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