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Cryptocurrencies

That’s Just the Way It Is

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As if South Korea doesn’t have enough problems at the moment, Korea’s most popular exchange site bithumb, which is the number one crypto exchange by volume in the last 24 hours, and responsible for an estimated 10% of global cryptocurrency trading volumes, was hacked.

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This hack attack does seem limited in scope. Overall, only about 3% of users reported having issues and though some headlines are saying that more than 100 Billion Korean Wons were stolen, that amount in US dollars comes out to only about $1 Million.

Still, this type of event serves to illustrate a sore issue for alternative investors that many of these online exchange sites are simply not secure. In this case, it was enough that the home computer of a bithumb employee was breached to compromise the personal details of clients funds.

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Exchange sites can be very useful to obtain cryptocurrencies but please don’t keep your money in an unregulated marketplace. If you really want to hold the physical keys the best way to do this is by using a digital wallet. If your sole purpose is to invest in cryptos and take advantage of the price movement, make sure to use a regulated broker like eToro in order to minimize the risk.

Mati Greenspan
eToro, Senior Market Analyst

 

Please note: All data, figures & graphs below are valid as of July 5th. All trading carries risk. Only risk capital you’re prepared to lose.

Market Overview

With all the talk about North Korea in the media over the last few days, it’s very strange that the markets remain complacent.

Usually, if there is a factor of risk, tensions between the USA, Russia, and China, or the like, we should see some type of flight to safe assets.

Well, Kim Jong Un has just demonstrated that he has the capability to send a missile as far as Alaska, and may have the ability to nuke Tokyo very shortly. Yet, the markets remain eerily calm.

Sure, the 4th of July could be partially responsible for muted volumes and activity but assets like Gold have had very little downtime and currencies like the Yen, and the US Dollar have been open throughout the holiday.

There was a light sell off at the end of the European session yesterday but stocks in Asia this morning seem oddly resilient. Here’s the China 50 index. Notice the last candle on the left showing today’s performance and notable recovery as Asian investors throw caution to the wind.

Fed Day

This evening, or around lunchtime on Wall Street, the US Federal Reserve Bank will release the minutes from their meeting three weeks ago.

The Fed, along with other central banks around the world, have been trying very hard lately to emphasize that the 2008 financial crisis is finally behind us and would love to get back to business as usual.

During their last meeting, they did manage to raise the interest rates by 0.25% to 1.25%, despite the economy not performing according to their expectations. They’ll have another meeting this month on the 26th and markets are currently predicting a 0% chance that they’ll raise the rates again.

For short term traders, an unexpected move by the fed could mean great gains, but for long term investors, it’s more important to keep in mind the projections of where we’ll be in a year or more. So let’s take a look…

Here, we can see the implied market probability of the Fed rate will be unchanged at 1.25%, raised to 1.5%, or raised to 1.75%, by August of 2018…

So, the most likely outcome is that we’ll be exactly where we are now, with a fair possibility of rates going up ever so slightly.

This could explain why the US Dollar has been underperforming over the last few weeks. The Fed is obviously talking tough and encouraging their counterparts to do the same, but markets are betting that they won’t be making any further advances on this front any time soon.

Crypto Market

At this point, the lack of excitement in the traditional markets seems to be mirrored in the digital world.

The overall market cap of all cryptocurrencies has remained steady at around $100 Billion for an entire month.

Though awareness has been gaining steadily and there have been many positive updates about new regulation and legalization of cryptos in various regions, for the time being, things are pretty stagnant.

Taking things into perspective, it’s really difficult to complain. Many of these coins have risen thousands of percentage points over the last year. So, a period of calm should really be a blessing. The fact that it’s holding in place should actually be seen as a very positive sign and we hope that it stays this way for a while as the markets get used to the new valuations.

The triangle patterns that we’ve been tracking are holding up well. To recap here are the technical patterns for Bitcoin and Ethereum.

So… until we see a breakout of these formations, we should probably take a look at the rest of our portfolios and be sure that everything else is on track. Remember, the key to any good investment is sustainability and diversification.

Have an awesome day ahead!

This content is for information and educational purposes only and should not be considered investment advice or an investment recommendation.

Past performance is not an indication of future results. All trading carries risk. Only risk capital you’re prepared to lose.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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2 Comments

2 Comments

  1. Namkyue Kang

    July 5, 2017 at 10:55 am

    1USD is 1150 Korean Wons so 100 billion Korean Wons is approximately $87M, not $1M…

  2. Mati Greenspan

    July 5, 2017 at 12:36 pm

    Thanks Namkyue. I stand corrected. There’s a lot of numbers floating around on various sites so it’s difficult to know exactly what the damage was. Near as I can tell it was more than 1 billion won and around $1 million.

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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

(more…)

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Altcoins

Trade Recommendation: XMR/BTC Pair Throwback

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The XMR/BTC market (Monero) has been in downtrend on the hourly chart after posting a high of 0.0225 on December 6 and failing to hold critical support at 0.02. It went to as low as 0.0145 on December 8 before respecting RSI at 32 where it established support. The market used the new support level to rally and generate one higher low after the other. It recently attempted to reclaim support at 0.02 but was repelled by bears. Currently, the market is trading around 0.019 levels where it appears to have created another higher low.

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Technical analysis shows a large reversal pattern in the hourly chart that can take the XMR/BTC pair to 0.025. Even though the market failed to breach resistance at 0.02, investors should not see it as a failed breakout. What we’re seeing is a throwback which is a temporary retreat in price. Throwbacks are common in breakout plays and are often seen as a bullish signal. The next time the market attempts to breach 0.02 resistance, it has a much better chance of breaking it with conviction.

The strategy is to buy breakout at 0.02 with immediate stop at 0.0189.

Hourly XMR/BTC Chart on Poloniex

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As of this writing, XMR/BTC is trading at 0.018714 on Poloniex.

Summary of Strategy

Buy: breakout at 0.02

Target: 0.025

Stop: move below 0.0189 after buying breakout at 0.02.

Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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Altcoins

Trade Recommendation: FCT/BTC Bullish Reversal

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The market reach its all-time high back in June this year when FTC/BTC (Factom) reached 0.01463162. Unfortunately, the pair wasn’t able to sustain its momentum. It created a lower high several days later at 0.01066744 which signalled investors to take profits or cut their losses. As a result, the market tumbled and lost 93.17% in value from its all-time high. Such a tremendous loss would have created an atmosphere of despair in the market. Usually, that’s when the savviest traders come in.

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Technical analysis reveals that the worst is behind the pair. FCT/BTC touched support at 0.001 on the daily chart twice and respected it on both occasions. This is a good indication that the market has found a reliable support level. In addition, hourly chart shows that a large reversal pattern is underway. The pair may have retreated when it nearly touched 0.002, but it generated a new higher low in the process at 0.00156566. The throwback is a bullish signal that enables the pair to gather momentum to break resistance at 0.002.

The strategy is buy on breakout at 0.002. Breach that level and the market reclaims 0.003. Sell that level because it is a strong resistance.

Hourly FCT/BTC Chart on Poloniex

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As of this writing, FCT/BTC is trading at 0.001738 on Poloniex.

Summary of Strategy

Buy: breakout at 0.002

Target: 0.003

Stop: move below 0.0018 after buying breakout at 0.002.  

 

Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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