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Technical Analysis: Ripple Keeps on Pushing Higher but Selling Pressure Persists

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The majority of the cryptocurrency segment is trading significantly lower today, as the early morning losses that were triggered by a proposed change in South Korean legislation (which was later corrected) are still present.  The dip was more a continuation of the already ongoing technical correction that has been led by Bitcoin. The majors all managed to rally off the lows to a certain extent, but only Ripple surged higher, riding the momentum of its still-dominant short-term bullish move, and scoring another marginal all-time high despite the pull-back.

XRP faces strong resistance in the current price zone, and although traders could still play leg higher towards the $1.50 level, the extreme long-term overbought readings point to a deeper correction in the near future.  Key support levels are still found at $1, $0.85, $0.68, $0.4250 and in the $0.30-$0.32 range.

XRP/USDT, 4-Hour Chart Analysis

Bitcoin traded in the vicinity of the $14,000 level throughout the session, bouncing as high as $14,500 after the early sell-off. The largest digital currency remains under selling pressure following the lofty gains of the last couple of month, and the correction that started in earnest last week is still expected to continue with a likely dip below $10,000. Primary support is still found near $13,000, with further levels at $11,300, $10,000, $9000, and stronger levels at $8200 and $7700.

BTC/USD, 4-Hour Chart Analysis

Ethereum

ETH/USD, 4-Hour Chart Analysis

Ethereum has been relatively strong in recent days, and the coin held up well during today’s dip as well, although it failed to follow Ripple in its rally in the second half of the session. That said, the currency is well above the Friday crash-lows and it is also clear of the Christmas lows, and the long-term uptrend is in no danger. While the key $740 level is now ahead as resistance, strong support is still found at levels are now found at $625, $575, between $480 and $500, and near the prior all-time high at $400.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin is one of the weakest majors today, as it already took out the morning lows, trading near the $225 at the moment. The coin has already shown weakness in the last couple of days, and now it is likely headed for a test of the correction lows. The long-term picture remains bearish from a momentum perspective, and investors should wait before adding to their positions. Key support levels are found at $125 and $100, with a weaker zone at near the $170 level while primary resistance is ahead between $250 and $260.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash is trading right at the $1000 level after a weak bounce off the morning lows, and the coin is also among the weaker majors, although it is slightly stronger than LTC. That said, we expect a test of the previous correction low in the coin too, as Dash is also looking prone for more downside after the stellar rally. Major support levels found are still found at the current price and below that slightly above $800, at $650, and near $600.

Ripple

XRP/USD, 4-Hour Chart Analysis

Ripple remains the strongest major coin from a short-term perspective, as it is trading just below its all-time high near $1.25. While traders could still play the short-term trend, investors should remain patient and wait for the next correction before adding to their holdings after the recent almost 500% rally. Support levels are found at $1, $0.85, $0.68, $0.4250 and in the $0.30-$0.32 range.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic is also trending lower today, and it is now just above the $25 level, which marks the correction-low so far. We still expect a move below $23 during this cycle, with strong support at $18. Primary resistance is ahead at $30, with further levels at $34 and around $40.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero has been trading in a narrow range today, following the morning dip, and the coin is still trading right at the dominant uptrend line, as the 4-Hour MACD is back in neutral territory. The currency is likely in for a trend-break and deeper correction in the coming period, with primary support still at $300 and further important levels found at $240, $200, $180, and $150.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO also go pulled lower by the broad sell-off this morning, and although the long-term picture is still more bullish than in the case of most of the majors, further volatile consolidation is likely as the correction concludes. Now, the currency is trading inside the domain correction pattern again, with key support zones still found near $56, $50, and around $40, and resistance is ahead at $64 and $80.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA bounced lower off the previously dominant rising trendline, and it has been relatively weak during today’s bounce. We still expect the coin to continue its correction, although it is somewhat ahead of the rest of the market in the cycle, and an early bottom is possible compared to the rest of the majors. Strong support levels are found at $3 and $1.5, with a Fibonacci support between those at $2.35.

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.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 346 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Analysis

Crypto Update: Monday Selloff Drags Majors Lower

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The cryptocurrency continues to show mixed short-term signs following last week’s Ethereum-led bounce, and the subsequent consolidation. Today, all of the majors sold off after the US open, triggering downgrades in our trend model, but the two largest coins, barely, retained their short-term buy signals, holding up above key support levels.

Ethereum remained north of $200, while Bitcoin is still above the $6275 level, but the total value of the market is back at $195 billion as BTC failed to gain ground during last week’s rebound, and as several coins failed to join the move. The odds of a failed rally got higher after today’s selloff, and the move still only qualifies as a counter-trend one, with the long-term downtrends being in no danger in most cases.

XMR/USD, 4-Hour Chart Analysis

Monro, which has been the third major on a short-term buy signal, is also still positive in our model, despite bouncing lower off the $120-$125 resistance zone and getting close to testing the $108 support level. The coin is now trading slightly below the rising short-term trendline and it would need to show strength quickly to retain stay on a buy signal. Further support is found near $100, while key long-term resistance is ahead at $150.

ETH/USD, 4-Hour Chart Analysis

Ethereum fell back to the $200-$205 support zone today, and the coin is trying to establish a swing low, following the initial rally of its 15-month low. Despite the pullback, ETH is still on a short-term buy signal, but given the segment-wide long-term weakness, traders should still not enter full positions. A sustained move below $200 would warn of a test of the lows and a possible new leg lower, with strong resistance still ahead at $235 and $260 and with further support found at $180.

Market Still Lacking Sustained Strength

BTC/USD, 4-Hour Chart Analysis

Bitcoin fell back to $6275 again after failing to show bullish momentum last week, and although BTC is still trading with relatively low volatility, well above the crucial support zone near $5850, the recent days are not positive for crypto-bulls. A sustained move below primary support would warn of a test of the weaker support near $6000 and a likely move to the key long-term zone, with resistance levels now ahead at $6500, $6750, and $7000.

XRP/USDT, 4-Hour Chart Analysis

Ripple’s weakness is also a warning sign for bulls, as the third largest coin not just failed to join the rally last week, but it turned lower today, threatening with another move towards the August lows. XRP is still trading within its short-term range, and it remains on a neutral short-term signal, but further weakness could quickly trigger a sell signal. Support below $0.26 is found near $0.23, while resistance is ahead at $0.30, $0.3130, and $0.32.

EOS/USD, 4-Hour Chart Analysis

EOS also remained weak during the recent altcoin bounce and now it is back on a short-term sell signal after dipping lower together with the broader market, plunging below $5 yet again. Now, a test of the August lows and a move to $4 is once again the most likely, with only the support between $4.55 and $4.65 found above the August low, while strong resistance is ahead between $5.35 and $5.55.

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.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 346 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Analysis

Crypto Update: Downtrend Looms for Binance Coin

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Binance Coin/Bitcoin (BNB/BTC) is one of the few altcoins that’s in the green this year. The pair is up by over 145% year-to-date. The gains can be shocking, especially if you consider that most crypto pairs are down by 70% – 90%. That’s because BNB/BTC has been known to move against the general cryptocurrency market trend. The pair rose just as many popular altcoins started to plummet.

Recently, however, we’ve seen a good number of altcoins show bullish signals. If BNB/BTC counters the overall trend, then could it be possible that it is in danger of becoming bearish? In this article, we show how a major shift in the trend looms for Binance Coin.

Presence of Bearish Divergence

Seasoned traders know that a bearish divergence is a sell signal. It indicates that the market has lost its upward momentum. Thus, it would be difficult to sustain the ascent even if prices continue to rise. Without momentum, the market is in danger of reversing its trend.

Pull up the weekly chart of BNB/BTC and you’ll see a bearish divergence on the weekly chart.

Weekly chart of BNB/BTC

BNB/BTC managed to climb even though momentum was dissipating. Switch to the daily chart and you’ll see an even larger bearish divergence.

This indicator is telling us not to buy the recent dip. Chances are the uptrend is already over.

Emergence of a Reversal Pattern

On top of a bearish divergence, BNB/BTC is forming a head and shoulders reversal pattern on the daily chart. This is further evidence that upward momentum is disappearing. The lower high of 0.0019999 that the market generated on August 09, 2018 is a sign of weakness. This means that demand has significantly decreased.

Daily chart of BNB/BTC

Currently, BNB/BTC is struggling to stay on top of 0.0014 support. In addition, technical indicators show that a breach is on the horizon. Volume has been thin even though the market is just above the support. Also, the daily RSI has been generating a series of lower highs.

Without volume and momentum, BNB/BTC is at risk of triggering the reversal pattern.

Entrance into Bear Territory  

Technical analysts have different definitions of a bear market. One of the most common definitions used is an asset enters bear territory once it drops by 20% from its recent high. That’s because in a bull market, participants would consider a 10% – 15% dip as an opportunity to bargain hunt. With strong optimism, markets tend to bounce and resume the uptrend.

A 20% fall from the recent high generally means that participants are no longer optimistic about the market’s outlook. They are not racing to place long positions even though prices have significantly dropped because traders are afraid. We’re seeing this dynamic in BNB/BTC.

Fibonacci levels of BNB/BTC

BNB/BTC is hovering just above the 50% Fibonacci level. That means that the market has lost close to 50% of its value from the recent high of 0.0026555. Yet, buyers are scarce. When a significant number of participants realize that demand is not going to be as strong as it used to, they will very likely dump their positions. That should ignite the downtrend.  

Bottom Line

Binance Coin may be in the green this year but it appears that change is coming. With many popular altcoins showing signs of life, BNB/BTC is revealing reversal signals. These include the presence of a bearish divergence, the emergence of a head and shoulders pattern, and the entrance and stay in bear territory.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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3.6 stars on average, based on 234 rated postsKiril is a financial professional with 4+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and ETFs, as he does his own crypto research and is the subject matter expert at ETFdb.com. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.




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Analysis

Pre-Market: China Bear Market Deepens as Shares Hit 4-Year Lows

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Global stocks and other risk assets started the week with slight losses so far, and the recently weak segments continue to struggle, while US markets are still acting relatively strong, suggesting the continuation of the recent trends. European markets are among the weaker ones again, even after last week’s bounce, with the major benchmarks all being around 10% off their highs, in stark contrast with their US peers.

Shanghai Composite, 4-Hour Chart Analysis

With all eyes on the second round of US tariffs directed to China, it’s no surprise that the pressure on the Shanghai Composite didn’t ease yet, and the benchmark slid to yet another almost 4-year low this morning. The Chinese Yuan is holding on well in the meantime, with the August low being in no danger, as of now.

USD/TRY (Turkish Lira), 4-Hour Chart Analysis

That said, emerging market currencies are back in the crosshairs, with Argentinean Peso, the Brazilian Real, and the Turkish Lira all drifting in early trading.  The Lira, which got a boost from the emergency 6% rate hike by the local central bank last week, is headed towards pre-rate hike levels, and that doesn’t bode well for the coming weeks with regards to Turkish and other emerging market assets.

Dow Futures, 4-Hour Chart Analysis

Economic releases will be few and far between this week compared to last week’s busy calendar, and today, only the Empire State Manufacturing Index made some waves, missing the consensus estimate, and suggesting a slowdown in the recently well-performing US segment. The final CPI in the Eurozone didn’t cause any surprises, coming in at the originally reported 2.0% annualized rate. The Dow, the Nasdaq, and the S&P 500 all opened slight below Friday’s levels after the releases, but the more interesting moves are in Forex markets.

Dollar Declines Against Majors as Commodities Mixed

DXY, 4-Hour Chart Analysis

After Friday’s bounce, the Dollar couldn’t maintain its momentum and today, the reserve currency is lower against most of its global peers, with the Dollar index sliding towards its July lows. With the Fed’s next rate hike just around the corner, the current move is more the product of Mario Draghi’s inflation warning, which is pushing the Euro higher since Thursday’s ECB meeting.

From a longer-term perspective, the Dollar’s strength could be undermined by the Trump administration’s pro-cyclical fiscal expansion, at least against the majors, but until the US economy keeps on booming, we expect bulls to be in control of the Greenback’s market.

Gold, 4-Hour Chart Analysis

Commodities are trading without a clear direction today, with copper following Chinese stocks lower, maintaining the strong correlation, while gold and crude oil are slightly higher. The WTI crude contract is edging towards the $70 per barrel price level again, still trading within a narrowing range, while the main precious metal is also stuck near the $1200 level following a four-month-long decline.

Featured image from Shutterstock

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 346 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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