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Don’t Panic. Analysis of Zcash, Stellar Lumens, Litecoin and Dash

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We have been suggesting here and on twitter like a broken record that the ETH and XBT trades were hyper-extended and overdue to correct.  It looks like big money and/or hostile forces have taken advantage of the two corrections to force out weak hands from many altcoins.  These are the days when if you are not leveraged, you ought to play golf or take the kids to the park.  The current selling will end, so if you are not leveraged, and if you failed to sell the highs, it might be a good idea to just relax and take a break.  Markets will almost certainly rise again in a few days, like the phoenix.  No need to panic.

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Zcash

ZEC is looking like a great trade.  Both short term and longer term charts have a bullish feel to them.

This 60 minute chart (bear setup) showed support was found at the 5th pair and the top of square, as shown above.

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This bull setup on a 144 minute chart shows pricetime exiting a 2nd pair.  Resistance at the top of square is ~ $360.  However, if this rally gets going, the 3rd and 5th pairs are MUCH higher.

For the astro-traders in the audience, today (5/27 -5/28) sees a myriad of different planetary alignments that suggest today is a day to watch.  For example, Mars has rotated 120 degrees (trine) since the start date of this coin, as of today.

Stellar Lumens

Stellar Lumen has bounced off the low pretty well, but there is reason to believe that the bounce will fail.  The 4th arc and 5th arc pairs may need to be touched before this correction will end.

Litecoin

LTC has found support, again, at a longer-term Gann angle.  If that angle fails, not expected but possible, the fall might be painful.  Traders might want to put a stop under that angle, if they have not done so already.

DASH

Dash has found support at a longer-term angle, but the short-term bear setup suggests that the arc pair supporting it is weak.  A re-test is likely.  My guess is that a test of the 3rd arc is likely in the cards. Traders might want to put a stop below that Gann angle, or below that arc, with a buy order ~ $100.

 

Remember:  The author is a trader who is subject to all manner of error in judgment.  Do your own research, and be prepared to take full responsibility for your own trades.

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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16 Comments

16 Comments

  1. leveler

    May 27, 2017 at 1:53 pm

    How about XRP?

  2. mikejeffery

    May 27, 2017 at 1:53 pm

    Any ideas about Ripple, seems that XRP is one of the most struggling coin in the past few weeks.

  3. nifymedia

    May 27, 2017 at 2:02 pm

    So according to the article, ZEC and STR is a buy now?

    • Joshnj82

      May 27, 2017 at 3:28 pm

      According the analysis ZEC looks profitable both short and long-term. XML (STR on Polinex exchange) recovered slightly but isn’t expected to recover from last session in full w/ the possibility of more losses in near future. That is the opinion of the analysis above.

  4. Gabriel

    May 27, 2017 at 2:09 pm

    I failed to sell the highs, so I took my kids out for the weekend. Very relevant advice as always Jim 😉

  5. Falkor

    May 27, 2017 at 2:49 pm

    How do you know it’s time to sell? Maybe next time I could avoid the the CryptoHammer!

  6. Jim Fredrickson

    May 27, 2017 at 3:51 pm

    I wish I had more cash to buy ZEC, XMR, DASH, XRP. The landscape is littered with bargains.

    • unitednoobies

      May 27, 2017 at 6:31 pm

      Hi Jim,

      What about XLM and ETH. The correction seems like a good buy? If so, when should a buy order be placed, what should be the entry point?

      • Jim Fredrickson

        May 28, 2017 at 12:49 am

        In both cases it seems a bit too soon to say the correction is over (time-wise, particularly for eth). But if you are not buying leveraged, then you can certainly buy here and make money in the weeks ahead… I think…

  7. chorez

    May 27, 2017 at 4:56 pm

    This Zcash graph you disply, seems like an old one? On poloniex it was trading for 120 at the low. Your graphs show a low of 150. Or is this the Kraken chart?

  8. Ritesh Sheth

    May 28, 2017 at 9:41 am

    Hi Jim,
    I would like to invest in ETH, Dash,XMR, ZEC and XRP. What percentage would you recommend on each of them for short (1-2 years) and long-term investment. Please suggest. Or Do you want me to pick any 3 or all 5. Reply Would be highly appreciated. I need your opinion. As I know Investment is subject to Market risk. thanks a lot.

    • Jim Fredrickson

      May 28, 2017 at 10:06 am

      ETH, XRP and ZEC have each been singled out as instruments that corporate America intends to put to use. Each of them have a very bright future, imho.

  9. Ritesh Sheth

    May 28, 2017 at 10:53 am

    Thanks a lot for your generous reply, appreciate it. I will equally distribute on all these three (ETH, XRP and ZEC).

  10. shyam_shankar

    May 28, 2017 at 1:22 pm

    ZEC you are telling based on the technical chart analysis or Coin analysis JIM? I have heard that ZEC has no future those are only speculations?

  11. Stipperdestip

    June 5, 2017 at 8:32 pm

    Hi Jim, what do you think will happen to Lumen before/ after June 27, 2017 (they are distributing up to 16 BILLION lumens to bitcoin holders or 16% of the initial lumens)?
    https://www.stellar.org/blog/bitcoin-claim-lumens-2/
    I look forward to receiving your view on this.
    Many thanks!

  12. Stipperdestip

    June 11, 2017 at 7:00 am

    Hi Jim, I still look forward to receiving your reaction. Best, S.

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Cryptocurrencies

Trade Recommendation: Stellar

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The price bounces from the support zone formed by the uptrend line, SMA100 and the support level. RSI confirms price reversal. MACD histogram supports upward movement and DMI allows opening long trades. It’s trading opportunity. Buy orders can be placed at 0.00000870 level with stop orders at 0.00000720 level. Profit targets are 0.00001200 and 0.00002000 levels. The daily chart does not give us strong bullish signals, that’s why this buy signal is more risky than it could be. You should invest small part of your deposit in this market or skip this trading opportunity. If you don’t use leverage, trading volume for this trade is up to 10% from your deposit.

Market: STRBTC
Buy: 0.00000870
Stop: 0.00000720
Profit Targets: 0.00001200 and 0.00002000

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The trading signal is based on Poloniex chart.
Disclaimer: The analyst does not have investments in Stellar.

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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Altcoins

Ethereum’s Pullback from Record Territory Continues as CryptoKittes Effect Wears Thin

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Ethereum resumed its descent Monday, a mere 24 hours after hitting new highs, a sign that the CryptoKitties bump was beginning to wear down.

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ETH/USD Price Levels

Ether’s dollar-denominated trade value plunged 10% on Monday to reach an intraday low near $429. Prices would later recover near $450 for a loss of nearly 6%. ETH/USD has declined 2.7% over the past five days in what has been a period of relative calm for the world’s second-largest cryptocurrency.

That being said, prices briefly traded at record highs over the weekend, touching $518. That narrowly beat the Nov. 29 high of $514.

At present values, the ether market is capitalized at nearly $44 billion, which is only a fraction of bitcoin’s $260 billion value. Ether’s 24-hour transaction volume came in at nearly $1.5 billion, according to CoinMarketCap.

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Volumes were evenly dispersed across the exchanges. Bitfinex’s ETH/USD pair saw the highest volume at 7.4% of the total market, which was equivalent to $108 million. Poloniex processed nearly 7% of ether’s daily turnover via ETH/BTC.

Ethereum rebounded from record lows against bitcoin, but remains relatively subdued as the world’s no. 1 crypto continues to dominate the market. ETH/BTC plunged 11% to 0.028040.

CryptoKitties

Much of the excitement surrounding Ethereum lately has centered on CryptoKitties, a simple collectibles-based game that was built on the ether blockchain. The game, which was released Nov. 28, allows users to purchase, trade and even breed digital kittens. Some analysts have likened the game to Tamagotchi, a handheld digital pets game launched in 1996.

Transactions on Cryptocurrencies are processed using ether, which is Ethereum’s native token. Industry estimates show that Cryptokitties transactions account for nearly 20% of all computations on the Ethereum platform. This figure appears to be growing continuously.

Although the game was immediately dismissed by members of the cryptocuurrency community,  Ethereum co-founder Vitalik Buterin and Earn.com CEO Balaji Srinivasan said the game had more virtues than some cared to recognize.

“Why is Cryptokitties actually important?” asked Balaji. “It’s one of the first examples of what people have been talking about for years: frictionless international trading of digital assets (not just cash!) on a blockchain. Basically what Fred Wilson saw.”

Earn.com markets itself as the “first token-based social network.”

At the same time, the CryptoKitties phenomenon presents several challenges for the Ethereum ecosystem related to scalability, future growth and ICO risk.

Ethereum continues to be the platform of choice for the budding ICO industry. The amount of money raised through the controversial crowdfunding model is fast approaching $4 billion for the year. The phenomenon doesn’t appear to be dying off anytime soon as more startups look to raise money to fuel their expansion.

That being said, many token raises and the issuers that back them are attempting to circumnavigate securities regulations by building a utility token. It remains to be seen how the regulatory landscape will evolve to keep up with the evolving nature of the industry. Equally important is how the cryptocurrency community will come together to address regulatory issues.

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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Bitcoin

Bitcoin Futures Officially Launch on CBOE

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The long-awaited bitcoin futures contract officially debuted on CBOE Global Markets Sunday, sending BTC/USD sharply higher. Trade volumes were reportedly thin as CBOE’s website crashed immediately after the contract went live.

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XBT Goes Live

CBOE’s futures contract, which trade under the symbol XBT, went live at 6:00 p.m. ET. Within minutes, bitcoin prices surged over $1,000, a sign that institutional money was pouring into the market. The BTC/USD exchange rate reached a session high of $15,811 before giving up gains later in the session. XBT traded at $16,000 soon after the contract went live, giving it a premium over the spot price.

At press time, BTC/USD was trading at $15,248, where it was little changed compared with the previous close.

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Bitcoin’s total market capitalization is $260 billion. Trade volumes over the past 24 hours have exceeded $13.5 billion, according to CoinMarketCap. South Korean trading desks drove much of the daily turnover, with Bithumb accounting for roughly 16.5% of transactions. That’s equivalent to roughly $2.2 billion.

The Bitfinex exchange turned over 12% of total bitcoin transactions, which is equivalent to $1.6 billion, data showed. Coinbase’s GDAX exchange saw 6% of the volumes, or roughly $823 million. GDAX experienced technical difficulty last week as bitcoin prices crossed $19,000.

Although trade volume on the exchanges was robust, liquidity in the futures market was relatively thin.

Highly Speculative Instrument

It has been argued that bitcoin futures represent one of the highest forms of speculation in recent memory, given that they are cash settled and have no delivery requirement. This point was raised by Randy Mitterling in Twitter of all places in response to Nassim Nicholas Taleb, the world renown essayist, scholar and former trader. Mitterling, who serves as a Chief Investment Adviser, said:

“Bitcoin futures are cash settled. No delivery requirement. It’s just a sentiment indicator that could be completely wrong compared to the actual price. Truly the most highest form of speculation ever created.”

Taleb, himself a brilliant writer and probability theorist, had provided a series of insightful tweets about bitcoin in general and the new futures contract in particular. In a Sunday post, Taleb said the following:

“Note that Bitcoin has a limited number of natural sellers. The entire concept is very concave supply (it costs more and more to extract). The number of producers shrinks with time.”

In an earlier tweet, Taleb also said:

“No, there is NO way to properly short the bitcoin “bubble”. Any strategy that doesn’t entail options is nonergodic (subjected to blowup). Just as one couldn’t rule out 5K, then 10K, one can’t rule out 100K.”

The arrival of bitcoin futures probably ups the ante on other forms of institutional investments involving cryptocurrency. Some analysts speculate that bitcoin exchange-traded funds (ETFs) are the next logical step for a market growing more comfortable with the idea of cryptocurrency.

CBOE chief Edward Tilly recently told CoinDesk that the case for a bitcoin-linked ETF is stronger now that futures trading is under way. As such, CBOE may be prepared to submit a new proposal to the Securities and Exchange Commission (SEC) to allow bitcoin ETFs and exchange-traded notes (ETNs) to be traded.

Tyler and Cameron Winklevoss failed to launch their bitcoin ETF earlier this year after the SEC rejected their proposal on grounds that the Bats exchange would be unable to enter necessary surveillance-sharing agreements.

A bitcoin ETF would allow investors to buy and sell the asset class much like a stock transaction. For many, it is seen as a precursor to greater mainstream adoption of the world’s no. 1 digital currency.

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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