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Analysis

Quiet Start for Cryptocurrencies after One Month of Correction

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The major coins are still trading without strong momentum, as the lengthy correction remains intact for both Bitcoin and Ethereum. Ripple is in an even longer sideways trading pattern, while Litecoin and Dash are in a short-term correction after hitting new highs last week. Ethereum Classic, which moved together with smaller coins during the weekend, is still acting weak, but it held up near a strong support zone that could signal a short-term trend change.

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While the long-term picture is looking more and more constructive for the market, as the overbought momentum readings have mostly been, ETH and BTC are still stuck in their corrections, and short-term traders should still be cautious, until a clear move to the upside. That said, some of the coins could already be ready for a move so let’s see how the charts look this morning.

Bitcoin

 

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BTC/USD, 4-Hour Chart Analysis

Bitcoin has been trading around the $2500 level for more than a week now, and it held up well during the weekend as the smaller coins got smashed lower. As volatility remains low in the currency, the long-term picture is quickly turning neutral. We expect some more sideways action before a major move in the coin, and before a clear move out from the short-term range above $2600, trades should still avoid new positions.

Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum has been the weaker of the two major coins in the past two weeks, and it’s still stuck in the declining trend that has been the dominant pattern during the correction. The $235 support is in focus today, and a break below that could mean that ETH will test the correction lows. Short-term traders should wait for a move above $250 before entering new positions, although the BTC held up above support at 0.095, showing early signs of healing.

ETH/BTC, 4-Hour Chart Analysis

Litecoin

LTC/USD, 4-Hour Chart Analysis

Litecoin remained in a bullish short-term correction pattern throughout the weekend, still looking the strongest among the majors. The long-term picture suggests that the current move might run into strong resistance soon, as the coin wold reach a significant long-term target in the $58-$60 zone. That said, another leg higher from the current levels is likely, but we suggest caution with new positions as the coin nears the target zone.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is in similar short-term pattern as Litecoin, although its break-out has stalled near the initial target at $216, as the coin failed to move away from the key $200 level. Both the short-term and long-term picture is still bullish, and a move towards $250 is still likely, especially if BTC and ETH will finally show strength int the coming days. Primary support is found at $190, serving as a good entry point for short-term trades.

Ripple

XRP/USD, 4-Hour Chart Analysis

Ripple is still stuck in its long-term trading range, as it still failed to move above the dominant declining trendline, despite being in a correction for nearly two months. Volume and volatility are still very low in the coin, as short-term traders avoid the sideways price action, and we also suggest to wait with new positions until a move above the current pattern.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

ETC fell to the lower boundary of it’s trading range near $14.50 during the weekend, and it remains clearly in a declining short-term trend, similarly to ETH. The coin is currently trading near the key $16 level, while the trendline in focus is slightly above the price near at $16.50. A move above that could open up the way to $18, but the highs near $23 are still far away for the currency.

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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

Daily Analysis: Dollar Falls, Gold Jumps after Yellen’s Final Move

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Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2668 -0.02%
DAX 13125 -0.45%
WTI Crude Oil 56.65 -0.68%
GOLD 1258.00 1.35%
Bitcoin 16,100 -6.32%
EUR/USD 1.1842 0.73%

The Federal Reserve hiked interest rates as expected today, and although the central bank’s monetary statement was slightly more hawkish than expected, the market’s reaction didn’t reflect the much-anticipated move. The worse than expected Core CPI reading that underlined the low-inflation narrative weighed on the recently strong Greenback, while stocks were unchanged after decision and bonds gained ground as yields retreated.

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EUR/USD, 4-Hour Chart Analysis

The major indices are hovering near their all-time highs with the DOW leading the way higher, hitting a new record for the second day in a row. While volatility Is expected to remain low as we approach the end of the year, market internals and valuation levels are still concerning from a long-term perspective, and stocks outside the US are also negatively diverging. The action in crude oil could be slightly more interesting as the commodity is starting to act in a slightly bearish manner after a grinding multi-month rally.

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WTI Crude Oil, 4-Hour Chart Analysis

The Brexit process is still in the center of attention in Europe, although volatility took a nosedive on the old continent as well, and it’s unlikely that the Christmas period will be much different, given the predictable drop in volumes and trading activity. The date of the next election in the financially and politically troubled Italy has been set to March 4th next year, and the early date caused some turmoil in the countries assets, which dragged the Euro Stoxx 50 lower today, together with the DAX and the other major indices.

Cryptocurrencies

As the total market cap of the crypto-market crossed the incredible $500 billion mark, Ripple, NEO, and Ethereum made headlines with lofty gains in the face of the severely overbought readings elsewhere in the segment. While XRP and NEO are still not overbought from an investment perspective, Ethereum reached our final target for its break-out and triggered a long-term sell signal.

ETH/USD, 4-Hour Chart Analysis

The previously surging IOTA continued its correction, Litecoin consolidated in a relatively narrow range, while Dash, ETC, and Monero scored marginal new highs before turning lower together with BTC. The most valuable coin that has lost some of its momentum “mojo” in recent days fell back below last week’s highs, and that could mark a failed break-out and a start of the deeper correction that seems more and more likely.

BTC/USD, 4-Hour Chart Analysis

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
11:30 UK Average Earnings 2.5% 2.5% 2.3%
11:30 UK Claimant Count Change 5,900 3,300 6,500
11:30 UK Unemployment Rate 4.3% 4.2% 4.35
15:30 US Core CPI 0.1% 0.2% 0.2%
15:30 US Crude Oil Inventories -5.1 mill -3.6 mill -5.6 mill
21:00 US Fed Rate Decision 1.5% 1.5% 1.25%
21:00 US FOMC Statement

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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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