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Analysis

Long-Term Cryptocurrency Analysis: Market on New Heights Fueled by Rotation

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The first week of the New Year has been another one for the history books in the cryptocurrency segment, as several coins rocketed higher again, with Ethereum and Ripple leading the way higher among the majors. The trio of NEM, Stellar, and Cardano made headlines as they surged higher on the list of the most valuable coins, but volatility was the name of the game in these break-out markets, while the more established names diverged substantially after the hectic holiday season.

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Bitcoin was a laggard for most of the week, but it got back to life towards the end of the week, as altcoins turned lower. BTC is in a neutral long-term position after the recent correction, and although the short-term setup is now bullish, odds still favor another leg lower in this cycle, after the historic run-up of the recent months. Primary support is still found at $13,000, with further levels found at $11,300, $10,000, and $9000, and stronger levels at $8200 and $7700.

BTC/USD, Daily Chart Analysis

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Ethereum hit a historic record high after recovering from the mini-crash two weeks ago, topping $1000 during the week, before entering a short-term pull-back. As the recent correction didn’t clear the overbought readings of the coin, we expect another strong move lower soon, although the short-term trend is still intact, and traders could still hold their positions here with tighter stops or trailing stop orders.  Key support levels are now found at $850, $740, $625, and near $575.

ETH/USD, Daily Chart Analysis

Let’s see the outlook for the other major altcoins after the first week of the year.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin has been trading similarly to Bitcoin lately, lagging the other majors for most of the week, and moving higher during the weekend, as the rotation in the segment took another turn. As the coin is nearing neutral territory from long-term momentum perspective a more lasting bounce is possible, but as BTC, LTC is also likely to at least re-test the crash lows in the coming weeks. Key support levels are now found between $250 and $260, at $125 and $100, with a weaker zone around $170, and primary resistance ahead at $300.

Ripple

XRP/USDT, Daily Chart Analysis

Ripple broke-out yet again earlier on this week and hit yet another new all-time high near the $3.30 level, before spiking lower in an overbought short-term correction. The coin is now testing the dominant rising trendline, and given the extreme momentum readings, we advise long-term investors to remain cautious here, although traders could still open small positions to speculate on another push higher. Primary support is now at $1.50, with short-term levels above that at $2.10 and $1.80, and further levels at $1.25, $0.85, $0.68, and $0.42.

Dash

DASH/USD, Daily Chart Analysis

Dash traded in a choppy but relatively narrow range for most of the week, and the coin is among the relatively weaker coins after the initial drop to the $850 area. The currency remains in a broad correction pattern and, we expect the large-scale move to continue, as the MACD indicator still points to bearish pressures. Below the primary support zone at $1000 and the key zone around $850, further important levels are still found just above $600, at $500, $470, and near $410.

Ethereum Classic

ETC/USD, Daily Chart Analysis

Ethereum Classic added to its gains earlier on this week, and it spiked almost to the $40 level before turning lower again, as it continues to work its way through the overbought long-term momentum readings. While the currency is already in a much more favorable position than a few weeks ago, we still expect a deeper correction to reset the sentiment in the market, and investors will likely have better opportunities to add to their holdings. Strong support levels are found at $30, $25, and at $18, while primary resistance is ahead at $34.

Monero

XMR/USD, Daily Chart Analysis

Monero moved below the previously dominant rising trendline, continuing the correction, and we expect further downside in the coming weeks after the stellar rally. The $300 support is still likely to fall in the coming period, with further key levels found at $240, $200, $180, and $150, while primary resistance is ahead at $400.

IOTA

IOTA/USD, Daily Chart Analysis

IOTA remained stuck in a long-term correction, being among the relatively weaker coins during the first trading week. of 2018. As the coin topped out already one month ago, a bottom might be near in time, but a significant dip is still likely after the exponential surge, so investors should remain patient with adding to their holdings. Support levels are still found at $3, $2.35, and $1.50 while primary resistance is ahead near $4.

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

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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23 votes, average: 3.22 out of 523 votes, average: 3.22 out of 523 votes, average: 3.22 out of 523 votes, average: 3.22 out of 523 votes, average: 3.22 out of 5 (23 votes, average: 3.22 out of 5)
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4.6 stars on average, based on 257 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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10 Comments

10 Comments

  1. ridge195

    January 6, 2018 at 10:21 pm

    I gave a low rating since there are too many conflicting opinions on the articles. Earlier there is a trade recommendation to buy monero because jt is on the upswing and here it is saying it is going into a deep correction. Its like there is no communication of ideas.

  2. MinerMatt17

    January 6, 2018 at 10:23 pm

    I am glad you added a voting button so I can give these articles a 1 star. No consistency to trade recommendations on Bitcoin, Dash, Monero, Etc.

    There is nothing to back up your repeated claims that bitcoin will correct further. It had its 40% correction, this is normal, not its time for higher lows, and tests of new highs in the coming weeks. Market cap of crypto is surging, not sure why you hate on bitcoin so much.

  3. persiano

    January 7, 2018 at 12:15 am

    È utile avere sottomano i livelli di supporto ma null’altro. Mi sembra la solita panoramica (anche incompleta, manca sempre BCH ETC) generale sulle crypto. Servono analisi anche meno tecniche ma più reali, del tipo: la settimana prossima la Sec si pronuncierà sull’argomento xyz o Ripple ha confermato un Escrow pertanto ci aspettiamo delle oscillazioni che…

  4. dfontes1188

    January 7, 2018 at 3:18 am

    Their disclaimer says it all “Never invest (trade with) money you can’t afford to comfortably lose”

    That’s mostly what you’ll do with these recommendations, lose.

  5. timallen

    January 7, 2018 at 11:16 am

    Isn’t the clue in the title – ‘long term’. I presume the trades are more short term in nature. That said to help readers perhaps there could be more cross referencing of recommendations. Keep up the good work everyone at Hacked

    • MinerMatt17

      January 7, 2018 at 10:34 pm

      Bitcoin, dash, and Monero can’t reach 1.75 – 2 x their current values and then correct that far back down again in the long term without the whole market collapsing. Don’t try to find excuses for them, they just don’t match up their trade recommendations with the analysis. Or really take into account the massive increase of the Market Cap of Crypto frankly for that matter.

  6. dist

    January 7, 2018 at 11:27 pm

    All of this analysis is opposite of how I feel and the charts show for these coins, especially dash and bitcoin. I’m still an alt guy anyway but the only reason all of these coins aren’t 50% up right now is because damn near every exchange is down at the moment.

  7. Chris G

    January 8, 2018 at 4:08 pm

    5-stars because Mate’s advice has made me a pile of $ over the last year …

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Analysis

Bitcoin Bears Running Out of Gas, According to Price Manipulation Theory

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A group of researchers at The Crypto Fam have linked price manipulation to bitcoin’s bear market, suggesting that the arrival of institutional trading allowed investors to dump oversized holdings of digital currency.

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Bitcoin Price Manipulation?

According to a new theory, it is no coincidence that bitcoin’s long unwind began on Dec. 17, the same day that bitcoin futures were launched. Over the next several months, the bitcoin-dollar exchange rate would fall from a high near $20,000 to a low of $5,980.

The rapid decline was aided by futures trading, which allows traders to short assets much more easily. As we’ve written before, shorting bitcoin was practically impossible prior to the launch of futures.

The theory posits that institutional money was stocking up on bitcoin well before Dec. 17, likely in anticipation of the CBOE/CME futures contracts. The bear market that ensued consisted of three major down moves, with the third leg beginning earlier this month.

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Each down move follows a similar pattern: (1) a fake-out dump, (2) a failed rally and (3) a major dump. Each leg down is driven by lower selling volume with each drop less severe than the previous.

The compelling study was presented this week in a series of tweets by The Crypto Fam, which describes itself as “a community of crypto enthusiasts bridging the gaps.” The group’s stated goal, according to its website, is to “make crypto not so cryptic.”

In describing the pattern, the researchers concluded that “the bear market is running out of gas” because their supply of bitcoin has declined since the pump culminated on Dec. 17.

“This is a very simplified explanation of how markets work. A great deal of the total BTC supply is not traded. Some is lost forever in idle or forgotten wallets. Other Bitcoin is hodled by strong hands who never sell. This gives [market makers] greater power with their share of BTC.”

End of the Downtrend?

With the bears and market makers running low on supplies, the researchers concluded that the end of the downtrend is near. Bounces are more shallow than before while bottoms aren’t nearly as low.

Bitcoin prices fell below $7,300 earlier this week but have since recovered to the $7,500 range. Since bottoming below $6,000, prices have failed to test new lows. On the opposite side of the ledger, rallies have also been limited to $12,000 and $10,000, respectively.

Institutional adoption is widely viewed as a positive development in the evolution of cryptocurrency trading, though the latest study sheds light on the downside risks of derivatives trading. A similar conclusion was drawn earlier this month by the San Francisco Fed, which compared the launch of bitcoin futures to innovations in securitization in the mortgage market. However, this model has been criticized heavily for mistaking correlation with causation.

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 418 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

Long-Term Cryptocurrency Analysis: Correction Deepens but Leaders Remain Stable

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As the major cryptocurrencies got hit hard this week, losing around 20% on average, the long-term picture in the segment got close to an entry point for investors. The overbought readings that developed during the late-April rally are now cleared and although the short-term trends are still clearly negative, we still expect the coins to resume the recovery. With that in mind, long-term investors could start accumulating the relatively stronger coins.

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On a negative note, even the leaders violated key support levels during this week’s selloff, but the secular long-term trends are not yet in danger. The prior leaders Ethereum, EOS, and IOTA are still in the center of attention, as we expect them to form a bottom soon. Bitcoin and the other relatively weak coins, like Litecoin, Monero, Dash, and NEO are still lagging the form a technical perspective, but they are also well above the support levels that would indicate an end of the secular bull market.

BTC/USD, Daily Chart Analysis

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Bitcoin is below the key $7650-$7800 support level and it remains the biggest drag on the market, despite a brief period of relative strength this week. The upper boundary of the base pattern that we identified in April is found near $6150, with a weaker zone around $6500, and with the short-term trend clearly being negative, the latter might be tested before a bottom forms. Further resistance is ahead at $8400, $8700, and between $9000 and $9200, and traders and investors still shouldn’t enter positions here.

ETH/USD, Daily Chart Analysis

Ethereum is testing the $555-$575 support zone after violating the $625-$645 range, with the declining short-term pattern being intact. A bottom near the $500 would still keep the recovery intact, but the correction low might already be in, and investors could already add to their holdings here. Further resistance zones are ahead between $735 and $780 and near $845, while support is found near $450.

(more…)

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 257 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

Pre-Market: Oil Plunges Below $70 as Markets Mixed Before Long Weekend

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Financial markets are relatively calm today, despite the hectic week that was highlighted by the Turkish currency crisis, wild swings in bonds, and a step back in US-North Korean relations. Stock markets turned lower globally, with US equities outperforming the rest of the world, essentially drifting sideways all week long, thanks to the slight correction in the Dollar’s rally, and the dip in Treasury yields that was triggered by the dovish Fed meeting minutes.

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S&P 500 Futures, 4-Hour Chart Analysis

Today, the durable goods report came out before the opening bell and although the headline number was a tad worse than expected the more important core figure beat the consensus estimate, helping the slightly dampening economic outlook, even as yields continue to fall, especially with regards to long-dated Treasuries.

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EUR/USD, 4-Hour Chart Analysis

Although emerging market currencies are way less volatile today than recently, despite the rebound in the Dollar, equities shed their early gains and are now slightly in the red. The all-important EUR/USD pair hitting yet another 6-month low near 1.1650, and the test of the key long-term 1.1450-1.15 zone looks more and more likely in the coming weeks, even as the pair is a bit oversold.

Energy Markets in Turmoil as OPEC Signals Production Increase Again

WTI Crude Oil, 4-Hour Chart Analysis

It seems that the crude oil market is in for a strategic switch yet again, as the OPEC, together with Russia made it clear today that the price of the Black Gold finally reached a desirable level. The cartel will be targeting a higher level of output later on this year in order to keep the US shale players under pressure by capping the advance in the key commodity’s market.

The WTI contract reached a 4-year high at $72 per barrel recently and the Brent contract which is more exposed to Middle East woes rose as high as $80 per barrel after trading below the $30 level just two years ago. The last phase of the advance extended above the level where a large portion of the shale plays turn profitable, and as global growth worries also surfaced, the commodity entered a selloff this week.

Gold Futures, 4-Hour Chart Analysis

Safe haven assets continue to be bid despite the relatively calm environment, and gold hit a two-week high today despite the bounce in the Greenback as buyers are back after the wash-out plunge below $1300. With the long-term setup and fundamentals still being favorable for the precious metal, the short-term downtrend line is in danger here.

As US markets will be closed on Monday, which usually favors an active session, volatility might remain high throughout the day.

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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4.6 stars on average, based on 257 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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