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Analysis

Trading Analysis: Bitcoin, Litecoin, Dash, Ripple, Ethereum, Stellar Lumens & Zcash

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Bitcoin

Bitcoin continues it’s epic run toward $2100.  I note that there is an energy point on the daily chart tomorrow, and that a 5th arc is in plain sight at $2100.  Traders might want to take some profits there.

DASH

In our last update we identified the top of the square (highlighted) as likely support, and indeed it was.  Target of $96 seems reasonable at this juncture.

Ethereum Classic

In our last update we identified the area highlighted in yellow as a likely turning point.  Note that this coin entered a long-term arc pair a couple weeks ago, moved sideways, and just exited the pair.  This is pretty bullish, IMHO.

Ethereum

In the recent past we pointed out that the 2×1 Gann angle (red) has provided pretty good support for some time now.  It has done so again. A target of $104 now seems reasonable.

Litecoin

In our last column we highlighted Litecoin as one of our favorite trades.  We tweeted that the area highlighted in yellow was a buy. At this point it seems likely that the 1st arc pair will yield in short order.  The next energy point  in a few days suggests a $40 target is reasonable.

Stellar Lumens

Stellar Lumens remains a favorite trade, despite the fact that it has been overshadowed by its XRP sibling. As you can see, it is on the cusp of exiting an arc that has been holding it back for a few days. Mind you, it has not yet closed above the arc yet! If it gets through the arc, it could go to .08-.1 from here.

Ripple

I’m sure everyone here knows that Ripple had a great week.  The fact that it has re-penetrated the arc that knocked it down is mildly bullish, though the top of square is resistance.  However, it could conceivably take a few days get through the arcs before it can mount a serious advance again.

Zcash

ZEC has been traversing a long term arc pair, sideways, for a couple weeks. An energy point is at hand, and the end of the arc pair is also close by.  When it touches the arc it will make a choice – while my guess is it will break upwards, I suggest waiting for confirmation.

Remember:  The author is a trader who is subject to all manner of error in judgment.  Do your own research, and be prepared to take full responsibility for your own trades.

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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5 stars on average, based on 2 rated postsJim has an MBA from the University of Southern California. He has had a long career in both Corporate Finance and IT. Along the way he discovered that trading was a vehicle with great promise, but struggled for a long time without a mentor. After having been knocked down many times and having struggled to get back up, he had an epiphany and realized that geometry was a solution. He shares his experience here. If you do well as a result of suggestions made here, feel free to say thank you :) BTC: 1FUq3GB1Q8zz2JpuBr7YHzVBKnaWoxgmya Follow him on Twitter (@jimfred1276) or email him at jimfred1276 at gmail.




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8 Comments

8 Comments

  1. MSNP05

    May 19, 2017 at 3:40 pm

    Ethereum is at 112 …do you recommend holding or selling ? Your analysis have been so valuable to our family. Thank you so much.

    • Jim Fredrickson

      May 19, 2017 at 11:00 pm

      Long term it is still a great hold. Short-term traders should take profits here.

  2. Joshnj82

    May 19, 2017 at 10:21 pm

    Jim, are you still expecting LTC to surge or does the last session give reason for hesitation? I only ask b/c most majors did well while LTC was flat and left behind.

    • Jim Fredrickson

      May 19, 2017 at 11:03 pm

      Yes LTC has been mildly disappointing. I still expect it to do well in the not-distant future, but wish some of my TC holdings had been in ETH the past 2 days instead. Oh well, there will always be another trade tomorrow.

  3. Joshnj82

    May 20, 2017 at 12:16 am

    I appreciate the response Jim and hope LTC got the memo that she’s supposed to move up not down. Let’s hope she’s just a bit slower than her friends. I also wish to receive a mulligan for the day and join in on the ETH party I completely missed. Unfortunately, I used up all my mulligans on last round on the course and don’t think exchanges offer them anyway 🙁 Let’s hope this time tomorrow I’m writing a celebratory response and a salud of cold ones. Enjoy the weekend good sir.

  4. xrolo24x

    May 20, 2017 at 6:38 am

    Thank you Jim. Wondering if your team can do an analysis on the Bancor ICO. We curious about it

  5. jacobss

    May 20, 2017 at 9:23 pm

    hi Jim,
    You are fantastic and I have been investing a lot based on your analyses.
    Very, very, very favourable for me.
    Where do you get these diagrams from, can I get life updates. Now I print them out and put lines in them myself.
    I wish I had access of them any time of the day.
    Thanks for all you great analyses and please keep on doing this.
    Jack

    • Jim Fredrickson

      May 20, 2017 at 11:21 pm

      Follow me on twitter (@jimfred1276). I often tweet if i see something happening in real-time. I will be launching a new service in the near future.

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Analysis

The Air Transportation Market is Growing. Where to Invest?

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By Dmitriy Gurkovskiy, Chief Analyst at RoboMarkets

Today, practically every person who has internet access knows what Amazon and Alibaba are. These are the world’s largest internet-companies who, for the sale of their products, also use famous platforms like AliExpress and eBay.

Their total revenue constantly has been increasing year after year.

And as long as these companies are oriented toward international markets, 95% of the goods they sell are delivered by air.

Here we could pay attention to the aircraft manufacturers, as the air transportation growth rate will lead to increased demand for new aircraft. Boeing has conducted research according to which the demand for pilots, aircraft technicians and flight attendants in the world is growing, and the biggest activity is expected in the Asia-Pacific Region and in North America.

This week, the news feeds have been peppered with headlines on the current shortage of pilots in airline companies, and this demand will be hard to satisfy in the nearest 10 years.

Last week, Ryanair pilots went on strike demanding a salary raise and improved improved working conditions.

Consequently, investors have started showing interest in airline companies. Also, rumor has it that Warren Buffett is going to invest in one such company (or in several), but it has not yet been indicated which one exactly. According to some reports, it may be Southwest Airlines Co. (NYSE: LUV).

Southwest Airlines Co. is an American low-cost airline founded in 1971. It is the biggest low-cost carrier in the United States and in the world by the number of transported passengers. As of December 2017, there were 706 Boeing 737 aircraft in the company. By its financial performance, the company looks attractive for long-term investments. For example, profitability has reached 16.90%. The Short Float ratio is very low – only 1.82% and the debt to equity ratio is 0.48.

Based only on the rumors, Southwest Airlines stocks have left the consolidation range between the levels of $50.00 and $53.50, having broken out the 200-day moving average and indicating a possible formation of an ascending trend on D1. The closest resistance levels are at $62 and $67.

On W1, a stable uptrend is visible and the broken out levels are becoming a support for underlying price.

It is unclear precisely which company Warren Buffett will direct his attention to, so we can analyze the financial standing of other airline companies, which can become potentially interesting investments.

Delta Air Lines (NYSE: DAL) is one of the largest airlines in the world. Its destinations network includes countries in Asia, Europe, North, South America and the Caribbean region. As of January 2018, Delta Air Lines had 853 aircraft.

The financial performance of this company over the last 4 years shows a drop in income.

Profitability is 7.7%, the debt to equity ratio is 0.67 and the Short Float ratio is 2.65%.

According to technical analysis, the price is trading near the 200-day moving average, constantly breaking it out in both ways. Since December 2017 the resistance has formed on the chart, as the stock still won’t break out. In this situation, the breakout of $57.00 can be a signal for the further growth of the price of the stocks, but, at the same time, it has to be confirmed by good Q3 results.

On W1, there is still an uptrend, but we can already see a more serious resistance area from 2015 in the range between $53 and 56. The price is now in this range. The stock already tried to break out of this resistance in January 2018, but is has never managed to secure its position above this resistance. Here there is a high chance of the price falling to the support at $40. Currently, the potential drop of the price of the stock prevails over the growth.

The next airline company which we can direct our attention to is American Airlines, Inc. It is also one of the largest airline carriers in the world with headquarters in Fort Worth (Texas). The aircraft fleet of the company amounts to 958 aircraft in total.

Unfortunately, recently the financial performance of this airline has not been perfect either.

The debt to equity ratio (25.16) clearly demonstrates how risky this asset may be. That means that the company has 25 times more debts than the means to clear these debts. In this situation, the slightest decline of aviation operations may seriously hurt the company.

It should be noted that American Airlines has the “youngest” aircraft fleet now, as the company has invested its money exactly in the aircraft, which has caused such debts. Therefore, the company decided to risk, bu investors have not appreciated it, and thus the price of the stocks in 2018 was constantly falling.

Currently, the stock is in a downtrend. The price is gradually dropping within the descending channel, breaking out the support levels. However, near the level of $36 there has appeared a surge in rise, which indicates a possible forming of a strong support.

This can be due to rumors about Buffett’s interest towards the airline companies: his fund has now about $100 billion of available cash and a part of it will get to the market. Overall, the stocks of American Airlines seem to be a very risky investment.

There is another large airline company, which may be interesting from the point of view of investments: United Continental Holdings.

United Continental Holdings (NYSE: UAL) is the fourth largest airline company in the United States. It appeared out of the merger of United Airlines and Continental Airlines in 2010. As of June 2018, the aircraft fleet of United Continental Holdings amounts to 716 aircraft. Also, as in the two previously described airline companies, the most successful financial year was 2015. According to those results, profits reached $7.34 billion.

The Short Float ratio is 5.20%; the debt of the airline is 1.62 times bigger than its internal funds.

On D1, the technical analysis indicates an uptrend, as the price is now above the 200-day moving average and has secured its position above $80. In this situation, the further growth of the price cannot be excluded.

On W1, the stock also shows a stable uptrend trend and is currently trading near its historical maximums.

Thus, the technical analysis indicates a good growth potential for this stock, but the possibility of the correction of the price to $75 cannot be excluded either.

Having summarized the data on the revenue, we can see the big picture in the airline transportation market for 4 airlines.

American Airlines has lost the most income, while Southwest Airlines has been constantly increasing its profit.

The rest of the data indicates that the riskiest assets is American Airlines – its debt is the biggest out of all the 4 companies, its profitability is low and its Short Float is high.

To sum up, for the nearest years Southwest Airlines looks the most attractive investment-wise.

Amid all these data, Southwest Airlines noticeably stands out – all the rest have not been able to restore the previous revenue level after 2015. The fact of the matter is that Southwest Airlines has concentrated on low-cost transportation and this decision turned out to be the right one. If Buffett’s fund does buy Southwest stocks, this may become a very good investment for the coming years. Nevertheless, even without it, the expected growth of the passenger throughput will only be increasing the profit of this company and, consequently, the price of its stocks.

You should not consider this article as a guideline to follow in any way – this is only information for analysis.

 

Disclaimer

Any forecasts contained herein are based on the authors’ particular opinion. This analysis may not be treated as trading advice. RoboMarkets bears no responsibility for trading results based on trading recommendations and reviews contained herein.

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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4.4 stars on average, based on 6 rated postsHaving majored in both Social Psychology and Economics, Dmitriy went on to continue his education in post graduate. He then worked as a team lead of a tech and fundamental analysis lab in the Applied System Analysis Research Institute. This helped him to acquire all necessary skills and experience to become a successful trader and analyst, as well as a portfolio manager in an investment company. Dmitriy is a pro in the financial field who authors articles for various international media. He also holds the position of Chief Analyst at RoboMarkets.




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Analysis

Pre-Market: Stocks Rebound as Turkish Tensions Ease

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While nothing has been fixed in Turkey overnight with the vague plans announced to fight inflation by the finance minister, global markets rebounded after yesterday’s panicky conditions.US stocks undoubtedly led the way higher yet again, as the Lira, which made it to the mainstream media in the last few days, is up by more than 7%, with the USDT/TRY pair pulling back to 6.50 from a high above 7, and risk-on assets are higher globally, with especially equities staging a rally.

USD/TRY, Daily Chart Analysis

The other emerging market currencies that sold off are also correcting, with the Argentinean Peso, Brazilian Real, and the Russian Ruble all being off their lows. Despite the positive signs today, the underlying trend is still bearish in the FX segment, and the Dollar’s strength doesn’t seem to abate, with short-term Treasury yields also looking stable.

DAX Index, Daily Chart Analysis

While the major European indices are slightly in the green, headed to the closing bell, European banks that are exposed to Turkey are not showing much enthusiasm, and we expect risk-off sentiment to return in the coming days, until meaningful action is taken by the Turkish authorities.

Emerging market currencies are definitely feeling the contagion effects, with the Argentinean Peso, the Brazilian Real, and the Russian Ruble all being down big time in the last few days. So far, the Turkish leadership failed to calm the market, rather they fueled the fire with the aggressive rhetoric, and the seeming ignorance of the basic macro-economic rules.

In economic news, China was all the rage today, and the country that has been targeted by Trump’s tariffs is feeling the pain. It would be foolish to think that the trade war alone is to be blamed for the weaker than expected indicators across the board, but the skirmish between the two mega-powers definitely triggered a slowdown in the credit fueled economy.

Shanghai Composite, Daily Chart Analysis

Industrial production, retail sales, and investments all came in well below the consensus estimates, and with the Shanghai Composite already being in a bear market, and the Chinese Yuan hovering near its 13-month low against the Greenback, all looks set for a harsh awakening in China.

US Still the Island of Caolm

In the US all eyes are on tomorrow’s retail sales report, while today only two less important economic releases came out. The NFIB small business indicator was higher than expected and import prices were unchanged as the Dollar’s rise likely evened out the first effects of the new tariffs.

Nasdaq, 4-Hour Chart Analysis

The Nasdaq rebounded strongly overnight, leading the major indices higher again, and with that it got very close to its all-time high, outperforming the rest of the world by a mile. With powerhouses Apple and Amazon still pushing to new highs, even as more balanced portfolios are left behind, the tech index could set a new record as soon as today, should the otherwise shaky risk-on shift hold.

Copper Futures, 4-Hour Chart Analysis

Commodities are mixed so far today, as copper fell below $2.70 again, as it got hit hard after the Chinese data dump, while oil continued to rally, climbing back above $68 per barrel, with regards to the WTI contract.

Gold also bounced back above $1200, despite the Dollar’s rally against its major peers, and we have to wait and see if the spike below $1200 finally marked the lengthy downtrend in the precious metal.

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 317 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: Altcoin Crash Continues, Ethereum Hits $250 as Bitcoin Holds Up

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The cryptocurrency segment endured another ugly overnight session, with the major altcoins plunging by double digits across the board yet again. The total value of the market is now handily below the $200 billion mark after the latest selloff, and despite the deeply oversold momentum readings, there is still no sign of even a short-term bottom, and our trend model continues to flash red too.

While Liteocin and Monero provided a glimmer of hope for bulls during the initial phases of the current leg lower, the coins that are among the laggards from a long-term perspective followed the broader market below support later on. With no bullish leadership forming, the strong downtrend is still dominant and traders should still remain defensive, despite the already heavy losses in the segment.

That said, in time, a more durable bottom is likely close, thanks to the negative sentiment and the oversold environment, but percentage-wise, further steep losses could be ahead.

ETH/USD, 4-Hour Chart Analysis

Ethereum is still in the epicenter of the decline, with a more than 15% daily decline, as the coin quickly got below the $275 level just after violating the $300 support, and even touched 4250 in early trading. The second largest coin fell through key zones without even a blink, and that points to forced liquidations in the market.

The coin is still on sell signals on both time-frames and traders still shouldn’t enter new positions. Support is now found at $260 and $230, while resistance is ahead between $275 and $280, and near $300.

BTC/USD, 4-Hour Chart Analysis

While sellers have been trying to push Bitcoin below the $6000 level amid the altcoin rout, the coin always managed to bounce back so far, and it continues to hold up clearly above the structurally important $5850 level.

The coin is still in a bullish secular trend and while the long-term picture is overwhelmingly bearish in the segment, the strength of the largest coin might be the basis of a coming recovery.  That said, the short-term downtrend is clearly negative in the BTC, and traders shouldn’t enter new positions. Resistance is still ahead at $6275, $6500, $6750, and $7000, while initial support is at $6000, while further support is found between $5000 and $5100.

Relentless Selling in Altcoins

XRP/USDT, 4-Hour Chart Analysis

Ripple still resembles a falling knife, similarly to most of the majors, and the coin continues to slide lower, as last week’s break-down led to a series of support breaches. The coin is now down by 40% in a bit more than a week, and it is currently testing the strong support zone near $0.26 after spiking briefly below it overnight. Should XRP hold above the spike low, traders could be looking for signs of a bottom, but for the coin is still on a clear sell signal.

XMR/USDT, 4-Hour Chart Analysis

With the smaller coins also being hammered lower, there is no real hiding place beside BTC in the segment, and yesterday’s slightly strong coins also broke down overnight. Monero violated the key long-term support near $80, which served as a base for the late-2017 run-up, and the coin is trying to hold its ground above that after the spike lower. While the downtrend is clearly intact, and the short- and long-term sell signals are in place, a recovery above $90, could point to the exhaustion of sellers.

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 317 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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