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Technical Analysis: Ethereum Leads Altcoin Rebound as Bitcoin Remains Strong

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Apart from a brief but steep dip in BTC the most valuable coin continued to rise, getting close to the $4900 mark, only a few percent of its all-time highs and the $5000 level. With news about a crackdown on Bitcoin-related activities coming out from Russia earlier on, the segment experienced a short selling panic. The coin is still the leader regarding relative strength, as the Segwit-rally continued to restructure the market towards BTC. With no major technical resistance left until $5000, we expect at least a test of that zone during the current leg higher. Support levels are now found at $4650, $4400, and near $4150.

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BTC/USD, 4-Hour Chart Analysis

Altcoins got under severe pressure yesterday, but that eased considerably today, and the most important coins rebounded strongly off their lows, with the exception of Ripple that has been outperforming the market recently. XRP is in a short-term correction after its surge, while Ethereum has been one of the strongest altcoins during today’s recovery. The previously leading Dash, Monero, and Litecoin are still slightly lagging the broader market, with Ethereum Classic being the weakest major. Let’s see how the short-term charts look after two busy days this week.

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Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum held up above the $285 support once again and it si showing considerable relative strength today, climbing back above the $300 level. As the coin is looking bullish long-term as well, we still expect a rally above the $330 resistance soon, and a possible test of the $380 level as well, with further support found at $250.

Litecoin

LTC/USD, 4-Hour Chart Analysis

Litecoin recovered well after yesterday’s sell-off and it remains one the least volatile coins despite being relatively weak since the China-crash. The $51 and $56 levels are likely to remain in focus as range trading is still dominant, but the long-term picture is bullish and a rally towards the $64 resistance will likely be the next major move in the coming weeks.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is trading below the key $300 level as the grinding correction continues in the coin. While the long-term picture is encouraging, we still expect sideways trading to continue, similarly to LTC before a significant move higher. That said, a major dip is unlikely in the currency. Primary support below $300 is at $265, while resistance is ahead at $330 and $360.

Ripple

XRP/USD, 4-Hour Chart Analysis

XRP is trading in a volatile short-term correction after its recent surge, and the $0.26 level is in focus now following a brief dip below $0.24 yesterday. The coin is still slightly overbought, and although we expect the rally to continue, with a test of the $0.30 zone, the current correction could last few more days. Support levels are now found at $0.22, $0.20, and $0.18, with resistance ahead at $0.26 and $0.30.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic remained relatively weak after breaking below the short-term rising trendline, as it continues to trade below the $12 level and the crucial resistance zone around $13.50. Short-term traders should still wait for a move above the primary resistance zone, with support still found near $11 and $9 and further resistance ahead at $16 and $18.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero’s market remained very calm even during yesterday’s brief altcoin panic, as the dominant low-volatility correction pattern is still intact. The coin still looks encouraging concerning the long-term picture, with the key $80 level still holding up. Further support is found at $68, while resistance is ahead at $100, $125, and near the all-time high above the $150 level.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO is still highly volatile as active trading continues in the coin, as it has been the case ever since the Chinese ICO-ban panic. The currency is back near the $30 level after yesterday’s plunge, and we still expect another test of the $40 level after the end of the current volatile consolidation. The long-term picture is bullish, with strong support at $25, and resistance ahead at $34 and $40.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA is trading right at the $48 support level after yesterday’s spike lower, and we still expect the key $0.45-$0.48 support zone to hold up in the coming period. The next leg higher should carry the coin back to the $0.64 resistance, with another weaker level at $0.56, and a long-term target of $0.75.

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Analysis

Daily Analysis: Dow Leapfrogs 23,000 as IBM Beats Estimates

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Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2560 0.13%
DAX 13043 0.35%
WTI Crude Oil 52.02 0.29%
GOLD 1284.00 -0.23%
Bitcoin 5435 -3.15%
EUR/USD 1.1793 0.23%

IBM surged higher today, as the company beat analysts’ expectations across the board, pushing the company’s shares up by more than 10% and helping the Industrial Average to a new all-time high yet again. The other major US indices kept on grinding higher as well for most of the day, despite the strong overvaluation, with the Volatility Index (VIX) still hovering around the 10 level. The NASDAQ and the S&P 500 finished virtually unchanged after a late-session sell-off, while small caps outperformed in the mixed environment.

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DOW 30 Index, Daily Chart Analysis

Global stocks also edged higher, with the Nikkei still leading the way, although the momentum of the move is still weak. The Yen’s weakness was the most apparent trend in currency markets, while the Pound rebounded well, despite the persistent Brexit worries, with the Dollar giving back some of its recent gains compared to its major peers. Gold also remained under pressure after retreating back below $1300 this week, while crude oil rallied on a bigger than expected, hurricane-related decline in US production.

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Gold 4-Hour Chart Analysis

Cryptocurrencies

The major coins had a hectic and bearish session, especially in early trading, as Bitcoin’s overbought conditions coupled with Ripple’s sudden downturn led to a segment-wide decline. Ethereum continued to slip, as the Byzantium-related optimism faded away, but it remained well above the $285 level, and recovered above $300 towards the end of the session. NEO and IOTA still have a negative correlation with the rest of the market, as the two coins surged higher in early trading and gave back their gains during the late-day rebound.

BTC/USD, 4-Hour Chart Analysis

Technical Picture

The DAX closed on a marginal new all-time high again, but the lengthy momentum divergence in the MACD indicator suggests that the steep uptrend continues to be in jeopardy. The low-volatility drift carried the benchmark above the 13,000 level, but a correction towards at least the 12,850 level is likely in the coming days, with another support level at 12,650 serving as a longer-term target. As the long-term uptrend is clearly intact, bears shouldn’t go all-in here but bulls should consider exiting their positions and wait until a correction to trade the long side again.

DAX, 4-Hour Chart Analysis

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
3:30 EUROZONE Mario Draghi Speaks
3:30 UK Average Earnings 2.2% 2.1% 2.1%
14:30 UK Claimant Count 1,700 3,200 -2,800
14:30 UK Unemployment Rate 4.3% 4.3% 4.3%
16:00 CANADA Manufacturing Sales 1.6% -0.1% -2.6%
14:30 US Building Permits 1.22 mill 1.25 mill 1.27 mill
16:00 US Housing Starts 1.13 mill 1.18 mill 1.18 mill
15:45 US Crude Oil Inventories -5.7 mill -4.7 mill -2.7 bill

Key Economic Releases on Thursday

Time, CET Country Release Expected Previous
2:30 AUSTRALIA Employment Change 15,200 54,200
2:30 AUSTRALIA Unemployment Rate 5.6% 5.6%
4:00 CHINA GDP 6.8% 6.9%
4:00 CHINA Industrial Production 6.4% 6.0%
10:30 UK Retail Sales -0.1% 1.0%
14:30 US Unemployment Claims 245,000 243,000
14:30 US Philly Fed Index 22.2 23.8
15:45 US Chicago PMI 58.6 58.9

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Analysis

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.

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Analysis

Daily Analysis: Dollar Rally Continues amid Fed Chair Confusion

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Tuesday Market Recap

Asset Current Value Daily Change
S&P 500 2554 -0.09%
DAX 12995 -0.07%
WTI Crude Oil 51.53 -0.66%
GOLD 1287.00 -1.22%
Bitcoin 5652 -0.86%
EUR/USD 1.1751 -0.38%

Yesterday’s trends are mostly continued in financial markets, such as the low-volatility levitation in stocks and the slightly more active trading in currencies with the apparent Dollar strength. The Great British Pound continued to be under pressure amid the amplified Brexit-related worries, but most of the other majors also lost ground to the Greenback.

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The Dollar rally has been fueled by the rise in the odds of some of the hawkish Fed Chair candidates, while overall, the “race” for the positions looks more chaotic than ever. Interestingly, the long-end of the yield curve is refusing to follow the short-term moves, and without the effects of the Fed’s QE program, the yield curve would probably be inverted by now, signaling strong recession risks.

Dollar Index (DXY), 4-Hour Chart Analysis

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The major stock indices are virtually unchanged yet again and even the previously surging Nikkei entered a consolidation, adding to the unusual October lull. Commodities have been quite active thanks to the Dollar’s vigor, with crude oil and gold both turning lower. Oil gave back most of yesterday’s gains as the Iraqi-Kurdish conflict turned out to be less violent than previously feared, and the brief rally fizzled.

WTI Crude Oil, 4-Hour Chart Analysis

Cryptocurrencies

The major coins are having a mixed session at best, as yesterday’s rebound wasn’t durable, and most of the coins turned back lower again. That said, despite the recent choppy price action, the total market cap of the segment is close to its all-time high, even as only Bitcoin is trading near its own record price level.

The optimism regarding Ethereum major Byzantium upgrade wasn’t enough to lift the second most valuable coin today, and the price of the ETH token retreated below the key $330 level after touching $350 yesterday after the upgrade’s lock-in. Ripple and NEO have been among the most active majors today, but with opposing performances, as Ripple fell significantly after yesterday’s break-out attempt, while NEO defied gravity and jumped above the $30 level after a corrective period.

BTC/USD, 4-Hour Chart Analysis

Technical Picture

The S&P 500 is grinding higher despite the overbought short-term momentum readings, and the benchmark is trading very close to its all-time high. The 2550 level is still in focus, but until volatility remains near record lows, the minuscule moves are unlikely to change the technical setup. While a sudden drop in prices could quickly negate the recent break-out, the consolidation could very well lead to further upside, as bulls remain firmly in control, despite the lofty valuation levels.

S&P 500 Futures, 4-Hour Chart Analysis

Key Economic Releases on Tuesday

Time, CET Country Release Actual Expected Previous
02:30 AUSTRALIA RBA Meeting Minutes
10:30 UK CPI 3.00% 3.00% 2.90%
11:00 GERMANY ZEW Sentiment 17.6 20.3 17
12:00 EUROZONE Final CPI 1.50% 1.50% 1.50%
15:15 US Industrial Production 0.30% 0.40% 0.20%
15:15 US Capacity Utilization Rate 76.00% 76.20% 76.10%

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