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Ethereum (ETH) Consolidates After China’s ICO Ban

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Ethereum (ETH) prices stabilized on Wednesday after plunging to three-week lows on news that China has officially banned initial coin offerings (ICOs).

China’s ICO Crackdown Lays Waste to Ether

The ETH/USD exchange rate crashed nearly 30% through Monday after China’s financial regulators ordered a halt to ICOs. Seven regulators, including the People’s Bank of China, the Central Network Office and the China Banking Regulatory Commission, issued a joint statement barring the ICO funding mechanism.

The ICO market has exploded since the start of the year, so much so that coin offerings surpassed early stage venture capital during the summer. In total, more than $2.3 billion has been raised through ICOs globally. A staggering 93% of that total has been raised since the start of 2017.

Ether peaked near $400 on Friday before plunging to a low of $278.00 on Tuesday. The decline shaved billions off the world’s No. 2 cryptocurrency, which has shadowed bitcoin all year long.

Ether was down 3% on Thursday to trade at $327.00, according to Bitfinex. The token established a daily range between $321.10 and $337.70.

The ether token is severely overbought, according to the Stochastic RSI. The 14-period RSI is neutral above the 50 range.

Further Clampdown on Cryptocurrency?

China’s relationship with cryptocurrency has been murky to say the least. Policymakers are concerned that digital tokens are being used to facilitate capital flight from the country – a trend that has stoked heavy volatility in the market. This partly explains mainland investors’ fascination with bitcoin and altcoins over the past few years.

According to  financial news outlet Yicai, China is poised to further tighten the noose around cryptos. That means it won’t just be the ICO sphere that is under scrutiny, but the market as a whole.

Earlier this year, the People’s Bank of China put a freeze on withdrawals at major Chinese bitcoin exchanges BTCC, OKCoin and Huobi. The freeze has since been lifted.

Cryptocurrency Crash Extends Beyond Ether

Since Sept. 1, the cryptocurrency market has lost $20 billion. It was down by as much as $40 billion through Tuesday.

The worst appears to be over, with 12 tokens now part of the $1 billion valuation club. OmiseGO became the latest addition to the club after prices climbed into the double digits for the first time ever.

Bitcoin (BTC/USD) was down more than 1% on Thursday to trade at $4,555.00, according to Bitfinex.  It rose above $4,900.00 last week for the first time in its history.

Cryptos remain far and away the best-performing asset class of 2017.

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 497 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Analysis

Crypto Update: Bulls Hold Their Ground as Coins Settle Down

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Trading volumes and volatility declined substantially in the cryptocurrency segment this weekend, as the major coins are trying to hold the key support levels that are just below the current prices. For now, Bitcoin, Ethereum, and Ripple all managed to avoid a break below the June lows and the technical damage is limited among the smaller coins as well, despite the still dangerous setups on the long-term charts.

That said, the general character of the market is still bearish, with high correlations between the majors, and robust resistance levels capping the rally attempts in most cases. With all of those in mind, and given the still active short-term sell signals in our trend model, traders should still not enter new positions here, as a test of the lows is likely in the coming week.

The market is still missing a leadership that could turn the short-term trend around, and the relatively weak coins that have been leading the way lower in the recent period are still not showing signs of strength, despite the occasional short squeeze rallies.

BTC/USD, 4-Hour Chart Analysis

BTC tried to get back above the $6275 support/resistance level several times since falling below it on Thursday but the attempts all failed so far. The coin is still in a clear downtrend, although the previous lows haven’t been tested yet.

From a long-term perspective, a durable break below $5850 would signal a structural bear market, so the coming period will be crucial for the whole segment. Primary support is at $6000, while resistance is ahead at $6500, $6750, $7000, and $7350.

Still No Real Momentum Among Altcoins

ETH/USD, 4-Hour Chart Analysis

The basic setup among the largest altcoins is unchanged similarly to BTC, with Ethereum trading between the $400-$420 support zone and the $450 resistance level since the Monday plunge. The coin is holding up above the June low, and it’s still relatively strong from a longer-term standpoint compared to Bitcoin.

On the contrary, ETH is looking weak short-term, and that also points to the continuation of the declining segment-wide trend. ETH is facing further resistance near $500, while support below $400 is found at $380 and $360.

XRP/USDT, 4-Hour Chart Analysis

Ripple barely managed to avoid a break below the June lows, and the third largest coin remains very weak from a technical standpoint, and strong selling pressure is apparent in its market. The coin should stay above the $0.42 level to avoid major technical damage, and he coming days could be crucial for bulls, with strong resistance ahead around $0.45 and $0.51.

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 291 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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Cryptocurrencies

Ethereum Price Resumes Slide Following Augur Launch

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Market pressures have put a firm cap on Ethereum this week, with prices struggling to make headway following the launch of a highly anticipated prediction platform that was years in the making.

Ethereum Price Levels

Ethereum was down 3% on Thursday to $430, the lowest since June 29, according to data provider CoinMarketCap. The second-largest cryptocurrency by market cap faces resistance north of $440, based on recent price action.

At present values, Ethereum has a total market capitalization of $43.4 billion. The coin’s total trade volumes amounted to $1.4 billion, which is fairly consistent week-over-week.

Ether’s losses Thursday mirrored a broader market pullback for bitcoin and the major altcoins. At the time of writing, the total cryptocurrency market was down $10 billion, or 4%, to $245 billion.

The ether price has been in a downtrend since Sunday following yet another failed rally attempt for the broader market. On Sunday, ETH/USD reached $500 for the first time in over two weeks. Over the next four days, values would decline 14%.

Ethereum Enters ‘Phase 2’ Development Following Augur Launch

The brains behind Ethereum believe the blockchain is entering into ‘phase 2’ of its development following the successful launch of Augur, the most complicated decentralized application on the network.

Ethereum co-founder Joseph Lubin told an audience of 15,000 strong at the RISE conference in Hong Kong that the world’s second-largest blockchain by market cap will soon fix its scalability issues.

“[Ethereum is moving] into a space where it can serve as the layer one trust system, and built into Ethereum we’ll have hundreds of thousands of transactions in the layer two systems,” Lubin said in a panel discussion, as quoted by CCN.

In the discussion, Lubin emphasized how layer two networks will process large amounts of data thanks to the efficiency and security provided by solutions like Sharding and Plasma, which operate as layer one protocols. Essentially, the integration of layer one and layer two systems will create an ecosystem where decentralized applications can be deployed without running into scalability issues.

Augur, Ethereum’s most complicated dApp, launched its decentralized prediction marketplace earlier this week to great fanfare. Shortly after launch, Augur became the largest dApp on the Ethereum network, quickly surpassing CryptoKitties in volume.

The Augur protocol took several years to develop and is widely regarded as having the longest project life cycle of any decentralized application.

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.

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4.6 stars on average, based on 497 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Analysis

Crypto Update: Coins Pushed Lower Again as Bitcoin Approaches Key Support

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The selloff that started on Tuesday continued today in early trading, with all of the top coins losing ground, shedding 3-7% compared to yesterday’s price levels. As bearish price action continues, correlations between the majors are still very high, and there are only a few relatively strong currencies to point out.

The weakest majors of the recent period are very close to hitting or already trading at new lows, with the likes of Litecoin, Dash, and Ripple leading the way lower, back below the $245 billion level regarding the total market cap of the segment. Small-cap coins are also under heavy selling pressure and NEO and Monero, which experienced strong oversold bounces also gave up most of their gains, so a bullish leadership that could turn the tide is missing currently.

DASH/USD, 4-Hour Chart Analysis

With that in mind, the short-term downtrend is likely to continue and we expect Bitcoin to test its crucial (for the whole market) long-term support zone near $5850 yet again. The long-term technical picture has been unchanged in the last couple of weeks thanks to the quiet, low volume environment, but as the coins are approaching key support levels again, we will post an updated long-term technical analysis before the weekend.

BTC/USD, 4-Hour Chart Analysis

BTC fell below short-term support at $6275 today in early trading, and it’s now close to the weaker $6000 and the above-mentioned $5850 support levels, still in a difficult long-term position from a technical perspective.

The coming days could see a rise in volatility, and traders should still not enter new positions here. Further strong resistance is ahead at $6750, $7000, and $7350, with another level at $6500, while below $5850 the next major zone is found between $5000 and $5050.

Ethereum and Ripple Still Hovering Above Support

ETH/USD, 4-Hour Chart Analysis

Ethereum held up above the Tuesday low so far, but the coin still remains relatively weak from a short-term standpoint, trading very close to the June swing low. The coin will likely test the $420 and $400 levels in the coming days, and barring a strong bullish reversal another leg lower towards the April low near $360 is likely ahead.

XRP/USDT, 4-Hour Chart Analysis

Ripple is on the verge of a major technical breakdown after a period of weakness, trading just abvoe the June low and previous all-time high. The short-term trend is still clearly negative, and a durable break below support would mean that the secular trend tuned bearish too. For now, a bear trap spike below support is still  possible but traders shouldn’t enter new positions here.

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 291 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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