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Technical Analysis: Futures Approval Fuels Volatile Crypto-Bounce

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Trading ranges remained extremely wide in the cryptocurrency segment today, as the correction of the past two days concluded in a strong rebound. The CFTC’s approval of Bitcoin futures trading was the major catalyst that drove the relief rally after the initial plunge, which signals a crucial step for the cryptocurrency towards the mainstream financial world.

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That said, the long-term charts still look hostile from a momentum perspective, and we expect a durable and deeper correction in the segment in the coming weeks. BTC bounced as high as $10,700, not far off the all-time highs from Tuesday. With the short-term picture being close to neutral again, a less volatile weekend could be in the cards. Significant support levels are still found at $8200, $7700, $7000, and $6700.

BTC/USD, 4-Hour Chart Analysis

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Dash continues to be the strongest major regarding price action as the coin quickly recovered almost all of its losses and it’s holding on in its short-term uptrend despite the stretched long-term picture. The currency will likely face a deep correction in the coming weeks and we advise investors to wait with opening new positions until a more neutral setup. Key support levels are still found at just above $600, at $500, $470, and near $410.

DASH/USD, 4-Hour Chart Analysis

With all of the most established coins gaining significant ground today, a re-test of the record highs is possible in the coming days despite the segment-wide 20% correction. That said, after the stellar run and the given the overly bullish sentiment, risks of a deep correction are high and investors should remain defensive. Let’s see the short-term altcoin charts before the weekend.

Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum followed the broader market higher today and it remains in a much less overbought condition than some of the other majors. For that reason, and the promising long-term technical setup, we expect ETH to outperform Bitcoin in a coming correction, with support levels at $400, $$380, and $350.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin is almost back at its all-time high near the $100 level following the meaningful bounce that we expected after the test of the $75 support. The short-term MACD is now neutral, but the long-term picture remains overbought, and investors shouldn’t open new positions here, although traders could still play the trend. Further support below $75 is found at $64 and $56.

Ripple

XRP/USD, 4-Hour Chart Analysis

Ripple is trading between the key $0.2250 and $0.26 levels yet again thanks to the rebound, while remaining relatively weak from a long-term technical perspective. The currency is still the most neutral major regarding momentum, and although further volatile trading is expected, it remains on a long-term buy signal. XRP faces strong resistance around $0.30, while support levels are at $18 and $16.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic found support near the previous all-time high at $23, and it spiked higher together with Bitcoin after clearing the short-term overbought momentum readings. The coin is likely to continue the correction, given the extremely overbought long-term picture, and a dip below $23 is likely in the coming weeks. Strong support levels are found at $18, and $16, while the $30 and $34 levels provide resistance.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero also bounced off the previous record high, and it remains inside the short-term rising trend too. The coin already hit our final target for the current cycle near $200, but another test of the highs is possible before a deeper correction. Support levels are still found at $160, $150, and $125, with the $180 level likely being in the spotlight during the weekend.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO continues to be the least correlated to Bitcoin among the majors as it trades in a volatile consolidation pattern since nearing the $50 level last week. The $34 level is in the center of attention, with the $30 price level providing major support, and the $40 level being the primary target ahead. The long-term picture is still encouraging, and we expect a move towards $50 and the all-time high after the correction in the segment.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA continued to show relative strength today despite the extremely overbought long-term momentum readings, and the coin might be ready to re-test the highs near $1.50. That said, we still urge investors and traders to remain defensive and wait for a deeper correction before entering new positions. Support levels are found at $1.1, $1, and $0.75.

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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.

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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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