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Long-Term Cryptocurrency Analysis: Bullish Picture Unchanged After Fork Day

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It was a huge week for the cryptocurrency market as the much-awaited Bitcoin and the beginning of the SegWit activation process for the most valuable coin raised fears and expectations alike before August 1.  The fork and the transition went relatively smoothly, and that restored the confidence of investors, pushing volatility down in the second half of the week. The calm environment served as a good base for the BTC market to stage a strong rally this morning, in line with the still encouraging long-term picture.

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BTC/USD, Daily Chart Analysis

The main targets for the breakout are near $3200 (already hit), around $3450, with a long-term range projection target at $4200. The other major coins are also bullish after the hectic week, with Ethereum finally breaking out of its declining trend together with Litecoin, which also gave a long-term buy signal, and Monero that continued to show relative strength.  As the bullish environment means lower correlations between the majors, the different coins are expected to move is different rhythm. Let’s see how the daily charts look after Fork Day.

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Ethereum

ETH/USD, Daily Chart Analysis

Ethereum is trading between the two key levels at $235 and $250 this weekend, with the token finally moving out of the long-term correction pattern. A new uptrend is being established by ETH, and that could set up a move towards $285 in the coming period. The daily MACD is still bullish, and it is in neutral territory leaving a lot of room for the coin to rally. The $200 level serves as primary long-term support.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin took off together with BCT this morning, breaking out from the dominant triangle pattern in line with our previous recommendation. The long-term MACD gave a buy signal today, after the coin established a new base between $34 and $38. Our range projection target is still near the $60 level, with the prior high being slightly below that at $58. Support levels are at $44 and $40.

Ripple

XRP/USDT, Daily Chart Analysis

Ripple is also moving higher, but it’s one of the last coins to be trapped in a declining pattern. That said, the coin is on a short- and long-term buy signal, despite the strong resistance zone ahead near $0.22 and the declining trendline just below that. A break-out from the correction pattern would confirm the base pattern and could signal a quick rally up to $0.30, with the MACD still being below zero.

Dash

DASH/USD, Daily Chart Analysis

Dash continues its bullish consolidation below its all-time highs, although it failed to break-out above $200, and it is still inside a short-term triangle pattern. The long-term MACD is neutral, while the uptrend remains intact. The long-term range projection target just above $250 could be in focus in the coming weeks, with support at $175 and $150.

Ethereum Classic

ETC/USD, Daily Chart Analysis

Ethereum Classic is also showing bullish signs, although it’s still inside a correction pattern, just like Dash. The coin found support near the key $14 level again, and gave a short-term buy signal this week. The long-term MACD remains slightly oversold, still giving an opportunity to investors to load up on ETC.

Monero

XMR/USD, Daily Chart Analysis

Monero surged past the key long-term resistance at $46 today, and it go close to the short-term target at $50 as well. With the long-term MACD still being bullish near the 0 level, a rally towards $58 is likely. A rally above that level could set up a move towards $66 and $70, our mid-term targets, with storng support at $42, and at $38.

How to Use These Charts?

As we stressed in our article on Bitcoin: “…not all strategies are binary (either holding an asset or not).There are many long- and short-term investment and trading strategies that can be successful in a roaring bull market like the one that the crypto-coin segment is experiencing, but mixing the time-frames and mixing trading and investing (see our article on the topic) could lead to troubles.”

Here is a reminder of some of the possible strategies once again:

  • Buy and hold, without caring about day-to-day (or even month-month) fluctuations
  • Buy and hold a core position and add on the major dips; a very powerful strategy
  • Buy a certain amount every week or month, and even-out your entry price, without the hassle of timing the market
  • Try to catch major turning points to reduce and “re-boost” your position
  • Trade short-term movements with stop-losses, targets, and strict risk management (this is trading not investing)”

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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4.5 stars on average, based on 224 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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Analysis

More Chance to Go Up for Litecoin

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Litecoin short term outlook is quite positive, while in a longer term, it’s somewhat mixed. Shortly, the digital coin may face a very strong resistance at $141, being currently priced at $140. As Dmitriy Gurkovskiy, Chief Analyst at RoboForex, says, Litecoin already tried to test this level earlier this week, but did not succeed.

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In the mid-term Litecoin is trying to break out the current range, and in case it finally manages to break out $141 and stay above, it may go up to $168. Before reaching this target, however, another downtrend may be formed, with Litecoin plunging to the support at $114 again. If the bears succeed in breaking out this level, too, another sell-off target will be at $87.

Current outlook, however, is mostly positive, with the key support being at $114 and the key resistances at $141 and $168. The MACD on D1 is in its negatives, but is going up, issuing a buy signal, while the Stochastic is in the positive area and confirms its buy signal, already issued some time ago.

Fundamentally, Litecoin has got much support this week. The market started buying out the coin once the news on the token being listed at Korbit appeared. As the recent reports say, the crypto started being traded on Korbit yesterday, while withdrawal should be available starting today, Apr 19. This is important for Litecoin: first, Korbit is one of the oldest and most reliable exchanges in Korea; second, as we have already stated a few times, if the crypto becomes widespread across multiple exchanges, its liquidity gets boosted, while the accessibility simplifies the transaction processes.

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Korbit decided to hold a contest, with the top 6 LTC/KRW traders getting prizes in Litecoin (the winner gets LTC 50, the runner-up will walk away with LTC 25). Meanwhile, Litecoin being available on Korbit also helped the crypto to rise on Bitfinex.

Currently, Litecoin is one of the most volatile currencies, mostly because of it always being in the news, which does good to its promotion. As such, it was announced a few days ago that LTC would be used as a payment method, and TenX already started developing a prepaid card for that purpose.

By: Dmitriy Gurkovskiy, Chief Analyst at RoboForex

Disclaimer
Any predictions contained herein are based on the authors' particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.

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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Analysis

Bitcoin Prices and Whale Sightings: Evaluating the Latest Trends

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Bitcoin’s value has skyrocketed 20% over the past eight days, but some say the upward trajectory isn’t as linear as it should be given the length of the most recent correction. The market’s sudden gyrations have left us with only one explanation: the bitcoin whales are back.

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Whale Spotting

It has been reported that the so-called bitcoin whales (those who hold oversized positions in the digital asset) dumped $100 million worth of BTC in less than 24 hours. For example, the anonymous balance of wallet 3D2oetdNuZUqQHPJmcMDDHYoqkyNVsFk9r declined by 6,500 BTC on Tuesday, which is equivalent to $50 million. As a result, bitcoin fell more than $200 on the major exchanges in just a few minutes.

Just one day earlier, bitcoin’s third-biggest wallet shed 6,600 units of the virtual currency at an average price of around $8,026.

Interestingly, a whale may have been responsible for the initial spike in BTC just one week ago. As we reported, a large order on Bitfinex triggered the initial spike in BTC as prices crossed $7,000 on the exchange. For the next two days, bitcoin would surge double-digits to breach $8,000 for the first time since late March.

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Investors are also keeping tabs on a high-profile whale based out of Tokyo, Japan. Nobuaki Kobayashi is in the process of liquidating billions of dollars on behalf of Mt Gox creditors. At last check, the trustee had sold about $400 million in bitcoin for an average sales price of $10,105. He’s expected to offload another $1.9 billion.

Speculation Grows

While advocates of bitcoin’s long-term value have barely flinched amid the latest downturn, speculators all but disappeared from the market. A simple analysis of Google search trends also reveals that laypeople have been losing interest in digital currencies since early February.

All that could be changing.

Cryptocurrencies have added nearly $100 billion to their market cap over the past week, with bitcoin doing much of the work. This appears to have compelled bitcoin’s large owners to sell their assets for reasons that are not yet unclear.

Of course, the multiple selloffs could just be coincidence or a bet that future prices will fall again. In the eyes of leading analysts, the latter appears to be less likely.

The head of Pantera Capital, who rarely predicts bitcoin’s future and is thus never wrong when he does, recently told clients that the digital currency has already bottom. Appearing on CNBC’s Fast Money, Dan Morehead said bitcoin’s bear market was just about over and that prices would continue rising from here on.

That said, choppy trading for bitcoin is hardly unusual and has come to be expected in a market that still lacks maturity. Whales or not, recent moves have made it harder to gauge the strength of the recovery.

That’s the message Thomas Lee of Fundstrat Global Advisors recently shared, according to Bloomberg.

“I think it feels off right now because, you know, we’ve been on a down trend since December, and now, even though the volatility hasn’t changed much, it’s hard to tell if bitcoin is trying to stage a recovery or if it’s continuing its down trend,” he said.

At the time of writing, bitcoin was valued at $8,175, having gained 3% over the past 24 hours.

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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4.5 stars on average, based on 332 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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Recommendations

Trade Recommendation: The Travelers Group

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Technical Overview

  • On January 23, The Travelers Company’s stock jumped nearly 5% after releasing their 4Q17 earnings (violet arrow in Figure 1). Then, during the “Feb Correction”, the stock pulled back to wipe out the entire gain, and more, over a couple of trading sessions.
  • Since then, the stock has been trading within a 7.5% trading range ($133 – $143.50 trading range – orange horizontal lines). In comparison, the broader markets have been swinging by more than 10% after the Feb 9 low was set.
  • More recently, over the past month, the stock has traded within an even tighter trading range, finding support at $135 and resistance at $140. On one hand, a key resistance continues to push prices lower upon every retest (red trendline and arrows). On the other hand, the stock has bounced off of a 6-month support over half-a-dozen times (green trendline and arrows).
  • The stock has been a laggard over the last 8 trading sessions, while markets recovered significantly and broke above key resistance levels.

Figure 1. TRV Daily Chart

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Implications

  • The stock’s tight trading range has resulted in options selling at below 20% IV for some expiries.
  • A break below the 6-month support is expected to result in a swift leg down, especially if the $133 level gets broken immediately after that.
  • A break above the red trendline likely to have the stock retest $140.

Outlook

  • Neutral with a bearish bias while the stock is trading between the red and green trendlines.
  • Bearish if the stock breaks the green trendline (currently at nearly $136).
  • If the stock breaks the red trendline, outlook will remain neutral, however with a bullish bias, as the stock will likely move higher by at least $3-$4 to retest $140.

Trading Recommendation

  • Buy the May, strike 135 put for roughly $2.40 – $2.60 or short the stock once the green trendline is broken. Use a close below $136 for a confirmation.  At the time of writing, at 11:20 am EST on April 18, the put is trading at $2.40 and the stock at $136.05.
  • Target: Cover stock/sell put when the stock reaches $130.
  • Stop: Cover stock/sell put if the stock closes above the red trendline (currently at $137.95 and falling by roughly 25 cents/day).

Benefit of Recommended Trade

  • A play on both direction and volatility (in the case of the put purchase).
  • A sloping-down resistance used as a stop, resulting in an improving risk-reward profile of the trade as time goes by.

Disclosure: Have a small put position and may buy more contracts based on the trading recommendation’s guidelines.

Featured image courtesy of Shutterstock. 

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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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