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Is the Pullback Over Yet?

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This communications tool that we call the internet is very powerful but it can also be dangerous.

Those of you who’ve been reading my updates for a while know that I love getting messages from people, especially when people send me information and links to sources. Don’t be surprised though if I ask you what’s in the link before clicking.

One of the most common ways for hackers to seize control of your device is by getting you to click on a malicious link. A malware attack known as Digmine was recently discovered on Facebook Messanger. Unsuspecting users who click on the link expecting to watch a video from their friend, inadvertently download a bit of software that runs in the background and uses the victim’s computer to mine currencies.

Though, I’m not sure what’s scarier, instant messenger mining this Dutch company who recently had success mining cryptocurrencies by harnessing the power of the human body. Even though inefficient compared to solar energy, it seems with these new devices body energy can in fact be harvested.

These type of images instantly bring up memories of the Matrix movies and give me the heebeegeebeez. I mean, if robots are eventually going to farm humans, why are we doing the work for them?

Happy boxing day!!
@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

Ridiculous Spikes

Crypto for Garbage

Are we out of the woods yet?

Please note: All data, figures & graphs are valid as of December 26th. All trading carries risk. Only risk capital you’re prepared to lose.

Liquid Example for Crypto

Most of the markets are back online already but it’s still a holiday in Europe and many investors simply take the entire week off. So liquidity is still thin. In fact, for those of you who are new in the market and joining due to the recent excitement in crypto, we actually have an excellent example of what low liquidity can do.

In eToro, as with many brokers, we too the decision to close the currency markets yesterday for Christmas. Some brokers however, decided to remain open despite the lack of customers.

The conventional currency markets are usually pretty fluid and the prices are quite stable. However, when there are no regular order flows, a small group of people or even a single player can move the market in leaps and bounds.

Yesterday, we saw this type of ridiculous price spikes all over the currency markets. Here lets take a look at the chart of the Euro/Dollar from Bloomberg’s pricing…

Notice, how the price per Euro suddenly dropped from about $1.19 to around $1.165 in the span of about 20 minutes. This is not a normal movement, especially on a day that there is no special news happening.

As we can see, the prices remained erratic for a total of six hours before returning to normal. Of course, any trader who might have had their stop loss anywhere within the line of fire would certainly have been shot and killed.

Here you can see eToro’s chart where the prices were simply closed for the long weekend and opened back up last night with little change from Friday’s close. Had we been open, prices would have spiked all the way down to that red X on the chart below.

What this means for Crypto

In the cryptocurrency market prices are always illiquid. During a regular day, if you want €100 Million you can usually get it from the top tier financial institutions literally faster than you can say “Jack Robinson.” Automated systems have been built over the last few decades that can produce the liquidity within milliseconds.

In the Crypto-market no such systems exist and when there are a large number of orders in a single direction, buy or sell, it can sometimes be difficult to execute those orders.

Note: This is also why the price moves so darned fast in this market.

Is the pullback over???

Short answer: It is in Asia.

Bitcoin is back at $18,500 in Japan, and almost $19,000 in South Korea. The price of Ethereum broke through 1,000,000 KRW (S Korean Won), which is about $955. In this holiday themed chart from cryptowat.ch we can see a clean breakout of the round number, with high volume.

The price level has been tested as a support but if the West manages to use the momentum from Eastern Cryptotraders over the next few hours, the pullback might just be over.

However, as we noticed over the last few days, the West has been driving this sell-off so we should soon see if they’ve gotten it out of their system.

Over the course of the year, we’ve noticed the different types of pullbacks. Sometimes it has taken a few days or even weeks for the market to recover and gain confidence, and sometimes it’s snapped back instantaneously.

For Bitcoin, the recent pullback has been the largest bitcoin has ever seen in terms of Dollar amount and largest this year in percentage terms. The decline has taken us from high of $20,155 on December 17th to a low of $10,720 on December 22nd, a total retracement of 46%.

I would assume that this type of blow might take a while to recover from and it’s possible we’ll see some gigantic range trading opportunities in the next few weeks.

Of course, a breakout in either direction above $21,000 or below $9,000 could also have serious psychological implications on the market in the long term.

For today, Bitcoin is leading the market with her 10% gains. 😉

Happy holidays!!

This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation. The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro. Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose. Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework.

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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4.7 stars on average, based on 139 rated postsSenior Market Analyst at Etoro.com.




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Altcoins

EncrypGen (DNA) Surges Ahead After Two Major Announcements

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Although nobody enjoys a bear market, the downturn has afforded me more time to research promising technology instead of worrying about trading patterns.  Not all projects will survive this downturn.  In fact, most probably won’t.  Instead, companies that have delivered upon their goals and promises will be the ones that soar like eagles.  EncrypGen (DNA) is an extremely promising company I have been following since their Initial Coin Offering in 2017.

Background

EncrypGen made global headlines in November when it launched the world’s first blockchain based genetic data marketplace.  The marketplace, called the Gene-Chain, brings together buyers and sellers to facilitate the exchange of genomic data.  Consumers will be able to both safely store their genetic data and, if they choose, generate passive income by selling that same data to researchers.  The good news for data sellers is that EncrypGen just made a major announcement which will make cashing out much easier.

Consumers Can Now Withdraw Via Bitcoin

As of Monday, consumers can now withdraw the proceeds from their data sales via Bitcoin.  This will allow consumers a quick, convenient, and safe method to withdraw their earnings and use it for whatever they choose.  With the holidays coming up, this is a perfect opportunity for consumers to generate some extra cash that can be used toward making the holidays extra special for everyone.  The next part of this process will include the ERC20/ETH integration.  The integration is expected to be completed in January.

Partnership With Murrieta Genomics

In addition to the new withdrawal method, EncrypGen also made headlines by announcing a major new partnership with Murrieta Genomics.  Murrieta Genomics is a genomic sequencing incubator based out of California.  Murrieta has agreed to offer EncrypGen’s Gene-Chain to the Genomic Data Industry.  This will greatly benefit both individual data users and researchers.  The hope is that this blockchain based solution will lead to more efficient and effective healthcare through the advancement of new medical treatments.

EncrypGen’s Chief Strategist, Joe Cawley, had this to stay about the partnership:

“Today’s Partnership moves Gene-Chain up the value chain toward those generating Next Generation Sequencing (NGS) genomic data, assays and testing techniques.  NGS genomic data unlocks the multi-trillion dollar personalized medicine market.”

Indeed, the opportunity currently available in genomics and personalized medicine is enormous.  Although there are a few competitors in this space, they have yet to even release an alpha platform.  Additionally, given the regulatory hurdles that new entrants will face, EncrypGen’s closest competitors are likely years behind.  As those competitors work on getting a platform built, EncrypGen will be focused on developing strategic partnerships that will enable the Gene-Chain to become the world’s go-to marketplace for genetic data transactions.

Conclusion

With the Gene-Chain now live, EncrypGen is focusing its attention on developing more strategic initiatives such as the partnership with Murrieta Genomics.  DNA token holders can expect more announcements like this over the next 6 months.

Although the crypto market is extremely depressing for all involved, traders must not lose sight of the end goal.  I recently wrote an article that the crypto market is still in the earliest phase of the technology adoption lifecycle.  EncrypGen is a pioneer in both crypto and genomics.  And I fully expect EncrypGen to not only survive the bear market but to prevail in the end.

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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Bitcoin

Bitcoin Price Showcases Resilience Following Anniversary Rally

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Bitcoin held on to most of its gains Tuesday, as the market consolidated higher following an early-week rally that coincided with the one-year anniversary of its last record high. The bulls aren’t out of the woods yet, and price action over the next 24-48 hours could dictate whether the newfound strength is here to stay.

BTC/USD Update

The bitcoin price reached a session high of $3,684.40 on Bitfinex, which was a considerable premium compared with other exchanges. At the time of writing, BTC/USD was trading hands at $3,594. The leading digital currency was valued anywhere between $3,470-$3,522 on other leading exchanges including Coinbase, Bitstamp, Gemini and CEX.io.

Looking at the aggregate pricing data, bitcoin was last valued at $3,523, having gained 4% over the past 24 hours, according to CoinMarketCap. Over the same period, trade volumes have surged by $1.7 billion to $5.8 billion, signaling a strong bullish shift in market sentiment.

Bitcoin approached $3,700 on Monday following a double-digit rally that reverberated across the virtual currency market. The rally came exactly one year after bitcoin notched its last record high, the now famous $20,000 bull run.

The spike pushed BTC into overbought territory, according to the Relative Strength Index (RSI). The RSI has since moderated back to the mid-50 region, according to the latest monthly chart.

The total cryptocurrency market cap was last spotted just below $113 billion. The market peaked above $115 billion on Monday. Market-wide trade volumes surged to $17.3 billion, according to latest available data.

Spencer Bogart Remains Bullish

One of bitcoin’s strongest backers believes 2018 has been a fantastic year for the leading digital currency – that is, if one looks past the price action.

In a new interview with CNBC, Blockchain Capital partner Spencer Bogart said there doesn’t appear to be an imminent ceiling to bitcoin’s market cap, arguing that the value limitations usually associated with early-stage tech startups do not apply to bitcoin.

“Bitcoin does not make a kind of price-to-earnings or price-to-value revenue that normally puts an upper bound or a ceiling on a typical kind of early-stage technology company,” Bogart said, according to CCN. “Bitcoin can surely reach that high. But how long will it take – we are not sure yet.”

From the perspective of institutional adoption and business development, 2018 has been a positive year for bitcoin. That value metrics have skewed the outlook to the downside isn’t at all surprising given last year’s crypto euphoria, which generated massively inflated prices in a short period of time. According to several analysts, the end of ‘crypto craze’ is a positive step toward establishing stability and predictability in the nascent asset class.

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 704 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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Analysis

Crypto Update: Ripple and Litecoin Lead Another Rally Attempt

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The last 48 hours saw a nice bounce in the cryptocurrency segment, which led to improvements in the short-term technical setup of some of the most oversold coins. While the rally, which is being spearheaded by Litecoin and Ripple, hasn’t changed the still overwhelmingly bearish long-term picture, it could be the start of a larger scale counter-trend move. We will take a closer look at the broader picture in our long-term cryptocurrency analysis, which will be released tomorrow.

The deeply oversold long-term momentum readings and the horrible sentiment in the segment could fuel a more sustained move, but until we have confirmation that the short-term trend change in the key coins, traders and investors should remain defensive even towards the relatively stronger coins.

The strongest coins should form a pattern of higher highs and higher lows before entering new positions, and for now, our trend model only shows neutral short-term readings even in the case of the leaders, and most of the coins are still on sell signals on both time-frames.

BTC/USD, 4-Hour Chart Analysis

Bitcoin hit marginal new bear market lows before bouncing higher yesterday, and although the coin got close to the $3600 level, it remains in a bearish technical setup, and our trend model is still on sell signals on both time-frames.

That said, a move above primary resistance could set up a failed breakdown pattern, which could trigger a larger scale correction, but for now, traders and investors shouldn’t enter positions here. Further strong resistance is ahead between $4000 and $4050, while support is found near $3250 and $3000.

ETH/USD, 4-Hour Chart Analysis

Ethereum also remains on sell signals on both time-frames despite the rally attempt, as it continues to be stuck below the key $95-$100 resistance zone. The coin is still deeply oversold from a long-term standpoint, but until a confirmed short-term trend change, odds still favor new lows in the coming weeks, and traders should stay away from Ethereum here. Further strong resistance is ahead near $120 and $120, while the next major support zone is found between $73 and $75.

Bullish Leadership Finally Forming Among Altcoins?

LTC/USD, 4-Hour Chart Analysis

Litecoin spiked as high as the $30-$30.50 support/resistance zone on Monday after breaking out above the $26 resistance level and it also broke the steep short-term downtrend line. Should the coin form a higher swing while remaining above $26, a short-term trend change would be confirmed, but for now, given the clearly bearish long-term picture, traders should wait before entering the coin’s market. Below $26, key support is found between $23 and $23.50 while the next major resistance level is ahead at $34.50.

XRP/USDT, 4-Hour Chart Analysis

Ripple is on a similar technical position to Litecoin, as although the sharp bounce took the coin above both the $0.30 and $0.32 resistance levels after hitting marginal new lows, a short-term trend change is not yet confirmed.

The coin needs to form a higher swing low and stay durably above $0.32 for an upgrade to buy in our trend model, and for now the long-term sell signal remains clearly in place, with the next major resistance zone is found near $0.3550.

XMR/USDT, 4-Hour Chart Analysis

On a negative note, only a few coins show clear technical improvements thanks to the rally attempt, and the likes of Monero, DASH, Stellar, NEO, and ETC only registered weak bounces and even in the case of the surging EOS and IOTA, the gains were only enough to regain a fraction of the recent losses.

So, while a short-term trend change could be ahead after the rout, traders should remain cautious until a clear bullish leadership is established in the segment.

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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4.7 stars on average, based on 422 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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