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Technical Analysis: Bitcoin Dumps and Pumps amid Broad Volatile Correction

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The crypto segment has been in turmoil today, as the most valuable coins turned significantly lower, leading to a mini-panic, but they rallied strongly off their slows as buyers stepped in the second half of the session.

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Bitcoin fell as low as $5100, for a 15% correction top-to-bottom, but it is now trading near the prior short-term support at $5400. As the long-term picture remains overbought, investors shouldn’t open new positions here, but traders could play a likely move towards the $6000 level, although we still advise small sizes, as correction risks remain elevated.

BTC/USD, 4-Hour Chart Analysis

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The other majors were also declining in early trading, led by Ripple, with only NEO and IOTA, holding up well during the sell-off.  Both of the latter coins faded away as the rest of the market recovered, but Ripple continued to suffer. For now, the long-term bullish picture is unchanged for the segment, but BTC’s overbought correction could still cause volatility in the coming period. Let’s see the short-term charts after the busy session.

Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum dipped below the $300 level amid the broad move lower and it got close to the key $285 support yet again before the bounce. The coin is now getting short-term oversold, with the long-term uptrend being in no danger. The long-term MACD is still neutral, and a rally towards $380 is likely in the coming weeks, with primary resistance ahead at $330.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin has traded well below $60 and spiked below $56 today, probably hitting a short-term bottom that could set up a move above the $64 resistance in the coming week. The long-term setup is still encouraging, and even as Bitcoin might cause volatile periods, the coin is expected to trend higher, with the next target being at $75.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash remained relatively stable amid the sell-off, but it dipped below the $300 level. The coin is still well inside the broad correction pattern that we have been monitoring, and the long-term setup remains unchanged. Short-term traders should still wait with opening new positions, but from an investment standpoint, the coin remains bullish, with strong support $265, and resistance ahead at $330 and $360.

Ripple

XRP/USD, 4-Hour Chart Analysis

XRP is in a freefall despite the encouraging news from the conference regarding the coin and after exiting the short-term uptrend it fell back to the $0.22 support, erasing most of its break-out gains. The long-term picture remains encouraging but more volatility is expected after today’s move, with the short-term picture clearly being oversold. Support is currently near the $0.20 and $0.18 levels, while resistance is ahead at $0.24 and $0.26.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic is testing the $11 support today following the other majors lower, and it remains the weakest major, technically speaking. As the coin still faces primary resistance at $12.50, with further supply around the $13.50 level, short-term traders should still stay away from entering new positions here. Support below $11 is found at $9, with more resistance ahead at $16 and at $18.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero followed the segment lower as well, and the coin is now back below $90 after trading briefly above the key $100 level during the weekend. Despite the dip, the currency remains on a short-term buy signal as the break-out from the declining trend is intact. Primary support is near the $80 level, while further resistance is ahead at $125. We still expect the bullish long-term picture to prevail, but more sideways price action is possible before a break above $100.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO acted promisingly amid the dip, and it continues to hover around the $30 level in a volatile fashion, leaving the long-term technical setup unchanged. The coin remains bullish barring a move below $25, with resistance level ahead at $34 and $40. The short-term picture is neutral, and the long-term momentum indicators are also near neutral after the volatile correction.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA recovered above the crucial $0.45-$0.48 support/resistance zone today in early trading, but now it’s back below the $0.45 level, despite the brief rally. The coin remains among the weakest majors and although the long-term picture is encouraging, short-term traders should wait with opening new positions until a bullish confirmation. Resistance is ahead at $0.56 and $0.64, while long-term support is found at $0.35.

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Analysis

Technical Analysis: Litecoin Continues Surge as Bitcoin Tests Highs

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With the crypto world being focused on the historical futures launch, the major coins all enjoyed buying following a hectic weekend, and a volatile week as a whole. BTC itself got another boost from the widespread publicity and the volatile correction of the recent days ended, with the most valuable coin bouncing back towards its all-time high.

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While the long-term picture remains severely overbought, the short-term picture is not stretched and further gains are possible even amid the elevated correction risk. That said, investors should wait for a more favorable entry point to ad dot their holdings, while traders should control position sizes in the light of the long-term setup. Major support levels are now near $13,000, $11,300, and $10,000, with stronger levels still at $8200 and $7700.

BTC/USD, 4-Hour Chart Analysis

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The major altcoins are all up today, but only Monero and Litecoin are still within short-term uptrends, and the segment as a whole is still dangerously overextended, and a deeper correction is very likely in the coming weeks. LTC continued its recent break-out, getting close to the $200 level, and joining the extremely overbought group regarding the long-term momentum, and triggering a long-term sell signal in our trend model. Key support levels are found $100 at $75 and $64, with a weaker primary level at $125.

LTC/USD, 4-Hour Chart Analysis

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Analysis

Long-Term Analysis of the Silver Market

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Silver

The silver market has once again caught investors’ interest as the price is nearing areas not seen since late 2008.

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2017 started at a low point for silver, and it seems it will end the year that way as well, meaning investors who bought at the beginning of the year haven’t suffered nor gained much.

This doesn’t mean, however, that the price hasn’t moved during the year. After the low start of the year, silver quickly tacked on about 18% to a top of $17.50 per ounce.

In terms of fundamentals in the silver market, things look a bit complicated for 2018. There are multiple forces pulling in different directions for the price of silver going forward:

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Positives

  • A sharp stock market correction can be expected to occur some time in 2018. Most likely, this will happen sooner rather than later. Stock market crashes always trigger a flight to safety, meaning gold, silver, and quite possibly bitcoin, can benefit.
  • We are seeing signs that inflation may be starting to rise again, although this is not confirmed yet. Rising inflation is always good for precious metals.
  • If the US federal budget deficit widens as a result of the new tax reform, the US dollar may suffer as a consequence. Goldman Sachs put out a note to investors in November 2017 saying that the US debt is “on track” to reach an “unsustainable” level in coming years. Fed Chair Janet Yellen has also said about the US debt that it is “the type of thing that should keep people awake at night.” Rising debt levels creates uncertainty about the economy, which is generally good for gold and silver.

Negatives

  • Central banks around the world seem committed to raise interest rates in 2018. Rising interest rates are bad for precious metals because it would make it more attractive to put money in the bank.
  • The cryptocurrency bull market is on track to continue, diverting attention and capital away from precious metals as a traditional store of value. However, this one is uncertain, as it may also be considered a positive in the way that the rise of cryptocurrencies brings the inflationary and unsustainable nature of fiat currencies into focus.
  • The US dollar may have hit a bottom in 2017 and trade higher compared to other major fiat currencies going into 2018. A stronger dollar is always bad for precious metals, which are priced in dollars.

Silver chart

When looking at the chart, we can see that silver is back down to were it started the year, which coincides with a major support area where it has turned several times in the past few years.

From a technical perspective, silver has been trading in a triangle pattern on the longer-term weekly chart, with the price now trading very near the lower end of the triangle, adding confluence to our bias that silver will trade up from here.

Silver failed to live up to our prediction from early 2017, and is now even trading well below the level from that time.

A low price by any measure combined with two major technical support levels adds confidence to our trade and makes silver a low risk and potentially high reward trade for 2018.

Depending on your own strategy and investment style, you may want to wait for the price to break out from the current triangle pattern it has been trading in for the past year and a half. You would then give up some of the potential return for an even safer trade. After that, major resistance is found around $17.50 and $18, with lots of upside potential if we can finally break through those levels.

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Analysis

Long-Term Cryptocurrency Analysis: Look Out Below?

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After last week’s observation that a major top is in or near in the segment, the Bitcoin surge continued for almost a week, with Thursday’s wild session taking the coin as high as $19,000 (the article uses Bitstamp prices) on some exchanges. While the currency already pulled back by more than 20% the long-term picture is still extremely overbought and a much deeper correction is likely in the coming weeks.

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BTC spiked below $13,000 today, violating the primary weak support at $13,300, with further levels now at $11,300, $10,000 and $9000, but stronger support only found at $8200 and $7700. Next week’s futures launch could cause another jump in trading activity, and volatility is expected to remain very high amid the likely correction.

BTC/USD, Daily Chart Analysis

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While not all altcoins participated in the, supposedly, last part of the rally, IOTA, Monero, and towards the end of the week Litecoin, also stretched above all conventional targets with IOTA also turning exponential after a deal with Microsoft. The coin exploded by more than 350% before entering an initial sharp correction, breaking the steepest short-term uptrend. Strong support is only found at $3 and $1.5, but potential Fibonacci support is at $2.35.

IOT/USD, Daily Chart Analysis

Let’s see how the long-term charts of the other altcoins look after the crazy week.

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