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ICO Analysis: Storj’s Move to Ethereum – Time to Buy In?

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Storj is a decentralized cloud solution which has been in the works for quite a long time. They have gone through multiple iterations, funding rounds, and the like, and made it to market over the last couple years with a usable solution, Storj itself, semi-separated from the Storj (SJCX) token, which is used to secure the network. The token is used to compensate those who put up hard drive space for rent. The space is used by the network, and each month every renter receives payment in Storj tokens, which are currently tradeable at over 50 cents each.

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Courtesy of Coinmarketcap.com

A Hacked Gold Member wrote in to ask if the switch to the Ethereum platform, written about here on CCN, is a buy signal for SJCX. This is obviously a tough call to make. The author does not always want to make strong statements regarding where other people should put their money, but prefers to warn of scams and bad ideas instead. Regardless, let’s consider all the factors here.

  • It is a technical pivot, moving from Counterparty to Ethereum. Counterparty is the one of a few Bitcoin-based “colored coin” implementations that is intended for some of the same purposes as Ethereum, e.g., allowing anyone to issue their own assets.
  • One of the stated reasons for this pivot is that transactions fees on the Bitcoin network have made it hard to sustain and still pay “farmers” – those who rent out storage space. This would be far more reasonable, and faster, on the Ethereum network. In essence, Ethereum is technically more suited for this purpose at present, which means this pivot is a good idea.
  • Those who hold tokens in the Counterparty iteration of Storj will get equal coins in the new issuance. The coins being sold in the upcoming token sale are owned by Storj Labs, the company which develops and backs Storj. So there will be no inflation.

This doesn’t exactly equate to a buy signal. Investopedia calls a buy signal:

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An event or condition that alerts investors to purchase a particular investment.

Pivoting to an Ethereum-based platform will probably improve user experience, and could easily lead to expansion of the platform, which could have the tertiary effect of a higher price. Farmers could choose to withhold their tokens from market, as a result, thereby limiting supply and further driving price up. This is totally within the realm of possibility.

Therefore while we cannot safely say that one ultimately minor change to the platform is a buy signal, we can call it a moderate buy signal. Projects on the Ethereum platform have been thriving of late, the base token itself is doing great, and decentralized, encrypted storage solutions solve a major problem even for large businesses that simply want to protect their intellectual property from hackers.

Courtesy of Coinmarketcap.com

The potential is there, the team is proving its versatility, and the idea that already-inducted Storj users will simply abandon the platform based on a switch to the Ethereum platform seems far fetched from here.

Bottom line: if you were thinking about buying SJCX before, this move should not discourage you.

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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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Analysis

Technical Analysis: Volatility on the Rise Again, as Ripple and Ethereum Hit Targets

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Ripple has been the star of today’s session in the cryptocurrency segment, as the only major coin on a long-term buy signal in our trend model continued yesterday’s break-out, and surged to a new all-time high. The currency cleared the $0.425 level that marked the top in May, and after the more than 6-month long consolidation phase, it promptly neared the $0.50 level.

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While the short-term momentum indicators are now stretched, the coin is still in an encouraging long-term setup, although the best period to buy already passed. The coin could be dragged lower in the case of the expected broad correction in the segment, but we expect XRP to outperform in the coming period, with support levels found at the prior high and below that in the range between $0.30-$0.32.

XRP/USDT, 4-Hour Chart Analysis

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Ethereum has been the other top coin on the rise, as the second largest digital currency surged past the final range projection target of the break-out two weeks ago at $685 in the aftermath of the launch of the BTC futures on Monday. The ETH token is now also on a sell signal on all time-frames, and we advise investors and investors to wait for the next major correction to establish new positions. Support levels are now found at $575, $500, $480, and $400.

ETH/USD, 4-Hour Chart Analysis

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Bitcoin

Trade Recommendation: Ride the Next Rally of Bitcoin

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The profit taking period that saw the Bitcoin market fall from 19,697 to a low of 13,501 in a matter of a few days is almost up. The market appears to have generated a new higher low and will use that level to make its next move up.

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Technical analysis reveals a large reversal pattern in the hourly chart that could signal the end of the correction. In addition, volume has been steadily decreasing. On Coinbase, volume spiked by as much as three times its average value in the hourly chart during the height of selling. In the last seven hours, however, volume has been way below its average indicating that bears have lot ammunition. More importantly, RSI in the hourly chart is far from overbought territory. This gives the market a lot of room to breach resistance at 18,000.

The strategy is to buy the market when it goes above 18,000. With signs of selling exhaustion, bears may not put up much of a fight the next time the pair breaches 18,000 on Coinbase. Also, the market has no stiff resistance above 18,000 so it has a clear path to our target of 22,500.

Hourly Bitcoin Chart on Coinbase

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As of the time of writing, Bitcoin is trading at 17,200.

Summary of Strategy

Buy: breach of 18,000

Support: 17,200, 16,800, and 16,450

Target: $22,500

Stop: Move below 16,450

 

Disclaimer: The writer 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.

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