The late-stage rally in the segment continued, as buying is concentrated in fewer and fewer names, with the rest of the majors experiencing capital outflows, as they are already entering a correction. The most valuable coins extended its historic rally above the $13,000, after moving out of the usually bearish rising wedge pattern.
BTC surpassed all our expectations for the current leg higher, as the financial mainstream focused on the cryptocurrency, driving prices to extremely overbought levels. Despite that, we still expect a deeper correction in the coming weeks that could be devastating to the late buyers of the rally. Major support levels are found near $9000, $8200, $7700, and $7000.
BTC/USD, 4-Hour Chart Analysis
Ethereum is leading altcoins lower, with the exception of IOTA and Monero, although those two coins also turned lower in the second half of the session. The second largest coin failed to reach last week’s highs and turned lower off the primary target for the cycle yet again, as selling pressure intensified today. The coin is still above the initial break-out level at $400, but during a likely deep correction in the coming weeks, a test of the $380 and $350 supports is possible.
ETH/USD, 4-Hour Chart Analysis
LTC/USD, Daily Chart Analysis
Litecoin turned lower together with the majority of the coins, but the coin is still trading in the close vicinity of the $100 level and the all-time highs. LTC is likely to follow the market in the likely deeper correction, and a re-test of the $75 ore even the $64 support is possible in the coming weeks, with the long-term picture being overbought, although the short-term uptrend is still intact.
DASH/USD, 4-Hour Chart Analysis
Dash is ahead of Litecoin in the cycle, as it already broke below the short-term uptrend, while being more than 10 percent below the all-time high of last week. The currency remains dangerously overbought from a long-term perspective, and investors should wait for more favorable conditions to add to their positions, with support levels near $600, at $500, $470, and around $410.
XRP/USD, 4-Hour Chart Analysis
Ripple is still showing relative weakness, and the coin fell below the weak short-term uptrend today following the broader market lower. We still expect volatility to pick up again, with key support levels near the current price, just below $0.20 and at $0.18. Target levels are ahead at $0.26 and $0.30, and the long-term momentum is still neutral.
ETC/USD, 4-Hour Chart Analysis
Ethereum Classic also faced selling pressure today, as it drifted back under the $30 level, trading right at the short-term trendline currently, with the long-term setup still being severely overbought. We expect a dip below the previous all-time high at $23 during the next correction, with further strong support found at $18.
XMR/USD, 4-Hour Chart Analysis
Monero pushed to yet another new all-time high as momentum players rushed to the market, and the coin surged as far as $300 before turning sharply lower towards the end of the session. The currency is still in a strong short-term uptrend but investors should wait for a correction before opening new positions as the long-term picture is overbought. Major support levels are now found at $200, $180, $150, and $125.
NEO/USDT, 4-Hour Chart Analysis
NEO continues to trade in a volatile range, as the brief calm period ended today, and the coin turned lower yet again, leaving the narrow range around the $40 level. The currency is likely to remain volatile as the broad correction runs its course and the re-test of the $34 level is likely with the $30 level also being in sight. The long-term setup remains encouraging and we expect a rally towards the all-time high following the correction.
IOTA/USD, 4-Hour Chart Analysis
IOTA rallied off the charts as the rally entered a parabolic phase, with the coin almost reaching the $5 level, while taking over Ripple in the list of the most valuable coins. The currency is still likely to enter a sharp correction soon, but the short-term uptrend is still intact. Due to the nature of the rally only minor support levels are found at $3.50 and $2, with the first major technical level found at $1.50.
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.
Technical Analysis: Litecoin Continues Surge as Bitcoin Tests Highs
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.
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
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
Long-Term Analysis of the Silver Market
The silver market has once again caught investors’ interest as the price is nearing areas not seen since late 2008.
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:
- 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.
- 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.
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.
Featured image from Pixabay.
Long-Term Cryptocurrency Analysis: Look Out Below?
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.
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
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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