Cryptocurrency Analysis

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Trading plan for Bitcoin for February 03, 2021



Technical outlook:

Bitcoin has managed to extend its pullback towards $36,100/300 mark and might be preparing to turn lower again. The crypto is seen to be trading around $36,150 levels at this point in writing and bears might be inclined to push towards $29,000 levels or continue consolidating in a range for few more trading sessions.

Bitcoin might have carved a meaningful top around $42,000 levels and since then has been consolidating within a potential contracting triangle. Immediate resistance is at $40,000, followed by $42,000 mark, while support is seen around $29,400 levels respectively. A break below $29,400 will confirm a bearish breakout and that Bitcoin should push lower towards $18,000 levels, which is fibonacci 0.618 retracement of the entire rally between $3,850 and $42000 respectively.

Also note that the trend line support is passing through $18,000-$19,000 range, which could provide enough support for a bullish turn. Only a consistent break below the trend line would indicate a major trend reversal ahead and the crypto might witness much lower levels, going forward.


Trading plan:

Remain short, stop @42,000, target @ 18,000


Good luck!




Oscar Ton
Analytical expert
InstaForex Group © 2007-2021

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Dash aims to break through key resistance and hit new highs

The rise of bitcoin supported the uptrend of the Dash altcoin. DSH/USD has broken through the key resistance level of 105.80. Today, it has reached the upper boundary of the technical range between 150.80and 116.48.

The horizontal line at 116.48 serves as a strong mirror level. In order to break through it, the pair needs to catch the bullish momentum. If DSH/USD settles above this level, it may then move upwards to 134.30.

Does the technical outlook confirm further strengthening of the altcoin?

It is worth mentioning that since January 11, DSH/USD has been holding in the downtrend channel of 149.68 - 133.08 - 144.00. Although this channel is not very precise from the technical point of view, it is still important to pay attention to.

In the period from January 21 to February 2, an inverse Head and Shoulders pattern was formed within this channel on the 4-hour time frame. The neck line was located near the highs at 111.55 - 108.70. This pattern is also not perfect, but it is worth taking a note for now.

Today, the price broke through the neck line and moved upwards after settling above the support level of 105.80. If we consider the reversal pattern, DSH/USD may well grow further, given its upside potential of around 80% of the head's length. In this case, its next upward target will be the level of 121.42, marked with the purple dashed line according to the highs from November 24, 2020 (on the daily chart).

However, we need to see whether the price will break through the resistance of the 150.80 - 116.48 technical range. If DSH/USD fails to break above this level, it will enter a downward correction with the targets located at the local mirror level of 111.28. In case of a breakout, the target is seen at the level of 105.80.





Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

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3R: Ripple, Reddit and Regulators

The rate of Ripple, silver and other stocks continues to increase in the market. However, many retail traders were unable to hold their positions in any of these instruments.

Nevertheless, such a market situation can not be ignored, so Treasury Secretary Janet Yellen announced that she will meet with representatives from SEC, Fed and CFTC on Thursday to discuss the sudden price increase brought by staggering maneuvers of retail traders.

Of course, where this meeting will lead and whether any decisions will be made is not determined yet. What is clear though is that regulators fear systemic risks, so they will discuss the role of hedge funds in the markets, as well as the threat of retail traders.

According to Chris Brankin, CEO of TD Ameritrade Asia, retail investors possess strong power in the markets.

"Similar events recur on a regular basis. But rest assured, regulators will strive to curb volatility and end market manipulation, "Brankin said.

But the cryptocurrency market is unlikely to be affected by regulatory measures. Does this mean that soon, restrictions will be imposed in the stock and commodity markets? We are not sure, but such a scenario could happen in the future.

In the meantime, Ripple is consolidating in a narrow range above 0.3512. 0.3914 will be easier to break than 0.3512. Therefore, the forecasted growth of XRP / USD to 0.4348 is still possible.




Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Outlook for bitcoin. Ether and bitcoin for beginners. Trading tips

Bitcoin

The price of bitcoin is gradually getting out of the sideways channel. However, in order to overcome strong resistance at the level of $37,800, a rather large surge in volume is required. Only a breakout and consolidation above this level will result in a new upward wave around the $40,000 mark.

Let's analyze the current signals and consider the prospects for bitcoin.

Signals indicating bitcoin's continued rally:

The bullish indicator, showing the likelihood of further growth in bitcoin, can be attributed to the Stablecoin Supply Ratio. The SSR determines the ratio between bitcoin supply and the supply of stablecoins. The indicator decreases when the price of BTC declines or when a new amount of stablecoins is put into circulation. The fact that the SSR is so low despite the high price of BTC, indicates that traders expecting bitcoin to continue to rise in the long term have entered the market.



In addition, many of these newly issued stablecoins are on exchanges. This means that market players are ready to buy crypto assets.



According to the latest data, the distribution of bitcoins among the network participants shows that the number of bitcoin whales has increased recently, suggesting the participation of institutional investors. This is an additional medium-term signal that bitcoin is likely to continue its upward movement.

Signals indicating a decline in bitcoin

There are no signals of a strong drop in the price of bitcoin yet. All the indicators point only to a correction that we have been observing since January this year after the price reached the peak values. The number of active addresses on the Bitcoin network has dropped significantly after the price hit a new high around $40,000. This suggests that bitcoin is likely to continue losing in value, but this decline will be corrective in nature. It can be clearly seen from the trading chart that the number of active addresses is gradually recovering, although the January peak is still far away.



Technical analysis and trading tips

As I noted above, bitcoin buyers will most likely face strong resistance around $37,800 following the surge triggered by Elon Musk's #bitcoin hashtag. However, buyers are rather strong, but they will hardly be so active. If the price breaks through the level of $37,800, bitcoin will most likely rise to the $42,000 resistance area. Such an upward movement will be more speculative in nature and it will be aimed at removing bears' stop orders.

If the price falls below $33,300, the area of the moving averages, it will be possible to talk about the renewed downward pressure. Below this range, bitcoin may quickly return to the $28,900 area, where the demand for the cryptocurrency is expected to increase again.




Ether

Ether has reached a new all-time high. Now buyers need confident consolidation above the level of $1,475, which will strengthen the cryptocurrency's upward trend. The main reason for such a sharp increase in ETH was the news that Ethereum developer ConsenSys and cybersecurity firm Securosys had decided to work in partnership with a view to reaching a higher level of security in Ethereum 2.0.

Notably, about 2,877,986 ETH worth over $3.7 billion has already been blocked on the Ethereum 2.0 deposit contract. This means that users are moving to the next level and the demand for ETH will only increase.

In addition, another reason for such boosted demand for cryptocurrencies among speculators was the news that US video game retailer GameStop would accept payments in ether and other cryptocurrencies.

Interestingly, ether has greater potential for growth than bitcoin. Moreover, futures will be very attractive for institutional players. Therefore, ether will most likely continue to gain in value. At the moment when bitcoin hit the level of $40,000, many traders closed their positions and switched to ether, thereby only increasing their profit.



Technical analysis and trading tips

If ether returns and tests the $1,441 mark, it will be possible to buy the cryptocurrency at a good profit. This will ascertain that there are major players at this level. This is where we can draw the lower border of the new ascending channel, which opens the way to a new high for the cryptocurrency. If the cryptocurrency continues to trade upwards, resistance at the level of $1,555 can be seen as the nearest target. In this case, ether is likely to make a powerful rally towards the psychological level of $1,600. From this level, there may be a slight downward correction.

If there are no active purchases amid ether's decline to the support area near $1,441, traders will have to postpone long positions until the test of the $1,267 low, where there is a number of moving averages, serving as support for buyers.



Jakub Novak
Analytical expert
InstaForex Group © 2007-2021

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BTC analysis for February 03,.2021 - Possible downside movement towrads $32.375

Further Development



Analyzing the current trading chart of BTC, I found that there is still potential for the downside movement due to overbought condition.

My advice is to watch for selling opportunities with the downside targets at the price of $32,375 and $29,565.


Key Levels:

Resistance: $38,400

Support levels: $32,375 and $29,565.




Petar Jacimovic
Analytical expert
InstaForex Group © 2007-2021

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Ethereum Increased As Expected, What Now?

ETH/USD reached a new all-time high of 1,573.70 today and it seems strong enough to jump even higher. Technically, the crypto was expected to increase after a temporary consolidation.

Ethereum's failure to drop deeper to retest the uptrend line signal strong buyers in the short term and indicates more gains ahead. I've told you in a previous analysis that ETH/USD should reach new historical highs if the BTC/USD will resume its upwards movement.


ETH/USD FLIRTS WITH RESISTANCE ZONE!


ETH/USD is traded above the 250% Fibonacci line and right under the up channel's upside line. I've told you in my previous analysis that breaking above the first warning line (WL1) represents a great buying opportunity with a potential target at the channel's upside line.

The price has ignored the first warning line (WL1) and the R1 (1,458) level and now it could hit the R2 (1,602) anytime.

Breaking and stabilizing above channel's resistance and above the R2 (1,602) represents a strong bullish signal. Such a breakout could signal a larger upwards movement in the upcoming period.

The price could decline again only if it registers a false breakout above the immediate resistance levels, or if it prints a major bearish engulfing pattern.


ETH/USD TRADING SCENARIO!

Buy a valid breakout (close and retest) above the R1 (1,602) and through the red upside line. The next upside targets are seen at R3 (1,727), R4 (1,854), and higher at R5 (1,980).



Ralph Shedler
Analytical expert
InstaForex Group © 2007-2021

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Litecoin: technical key levels and upside potential

On February 3, Litecoin broke through the strong resistance level of 146.04. Is there more potential for the upward movement?

According to the H4 chart, two Flag patterns were formed yesterday and during today's trading session. They indicate the continuation of the trend. In addition, LTC/USD entered a wide sideways channel of 146.04 - 171.25 which creates potential for further growth.

At the time of writing, the price has consolidated and formed the main part of the flag. This formation may indicate that the level of 146.04 will be confirmed as support. If the price pulls back from the horizontal line, the chances of further uptrend will increase.

However, we should keep in mind that Litecoin is still trading in close correlation with Bitcoin, the flagship cryptocurrency. And it seems that the main cryptocurrency is not going to rise and break through the resistance level of the triangle. Therefore, in case of Bitcoin's reversal, LTC/USD may not hold above the 146.04 area and may return to the sideways channel of 135.89 - 146.04.

At the moment, it is too risky to open long positions on LTC/USD, at least until the price faces support at the level of 146.04 or makes a clear upward reversal.





Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Forecast for BCHUSD on February 3, 2021 - BUY



1. Analysis of bitcoin futures volumes from the Chicago Futures Exchange (CME).

Since bitcoin is the flagship of the cryptocurrency market, we will first analyze its movement. The analysis uses data on horizontal volumes from the Chicago Futures Exchange on daily charts. The analysis is based on the "Footprint Profile" theory, in which the movement of the maximum volume level for the day can indicate the likely direction of the trend. The maximum volume level is the level at which the maximum number of transactions was made, that is, the level of a large player. Accordingly, the displacement of the maximum amount of levels up indicates an upward trend. Moving the maximum volume level down indicates a downward trend. The chaotic movement of the maximum volume levels indicates a flat in the market.

01.02.21 – maximum horizontal volume level (POC - Point Of Control) - 33975
02.02.21 – maximum horizontal volume level (POC - Point Of Control) - 34580

The POC moved up, the price reaction after the infusion of this volume - up. There is a possibility of continuing the upward movement.


2. Analysis of the long-term trend.

A trend is a trader's friend. Many traders know this saying, but do not know how to use it. The answer is simple: trade only in the direction of the trend. This way your trades will have more profit potential with less risk. According to the classical Dow theory, there are three main trends:

-long-term;
-medium-term;
-short-term.

It is all these trends that need to be analyzed before opening any transaction. In this analysis, we will do this.

The long-term trend in this analysis is the daily trend. Trades will be made on a daily timeframe and held for several days. The daily trend is analyzed using the EMA (48), an exponential moving average with a period of 48. If the daily candle closes above the EMA (48), it means that we are facing an upward trend and should buy. If the daily candle closed below the EMA (48), it means that the trend is downward and should be sold.



The chart shows the beginning of an uptrend, the price is higher than the EMA (48), so in this situation, it is worth considering only purchases.

3. Analysis of the medium-term trend.

In this analysis, the medium-term trend will be the trend on the 4-hour chart (H4). Also, the analysis will use the EMA (48) - an exponential moving average with a period of 48. If the H4 candle closed above the EMA (48), then the trend is upward and you should buy. If the H4 candle closed below the EMA (48), it means that the trend is downward and should be sold.



Several H4 candles closed above the EMA(48) and are holding higher. This means that the medium-term trend is upward and coincides with the long-term trend, so you should buy.


4. Short-term trend analysis.

The short-term trend, which can well show the entry point to the market, will be considered a trend on the H1 timeframe. The EMA (48), an exponential moving average with a period of 48, will help us. If the H1 candle closed above the EMA(48), it means that the trend is upward and you should buy. If the H1 candle closed below the EMA(48), it means that the trend is downward and should be sold.



The price is confidently above the EMA(48). Strong upward trend; long-term, medium-term and short-term trends are the same, you should buy.


5. Japanese candle analysis.

The classic Japanese candlestick analysis is used for the daily timeframe. In this analysis, we will also analyze the daily candle.



Closing yesterday's daily candle up, the candle is white. Extremes inside the previous candle, which indicates the weakness of the "bulls" pushing prices up. There is no obvious candle configuration, however, there is a growing white candle showing a possible continuation of the upward movement.


6. Conclusions.

Volume analysis: POC moved up, the price reaction is up - BUY.
Long-term trend: up - BUY.
Medium-term trend: up - BUY.
Short-term trend: up - BUY.
Japanese candlestick analysis - BUY.
General conclusion: 03.02.21 - it is preferable to buy.


7. Statistics.

To analyze the effectiveness of this approach, it is necessary to keep statistics on completed transactions. Opening a purchase transaction:

03.02.21 BCHUSD BUY: 150.70; SL: 129.63; the risk of the transaction:1% of the deposit. With a deposit of $ 10,000, lot 2.7

The stop loss is located behind the daily extreme. We do not set a take profit, as we will accompany the transaction by moving the stop loss beyond the extremes of the new days. Since trading is conducted on daily charts, this recommendation is relevant throughout the day.




Maxim Petrov
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical analysis BTC/USD for February 03, 2021

Trading Cryptocurrency BTC/USD (Bitcoin)

Bitcoin price prediction

Our target is still looking at $ 40k. Bitcoin bouncing perfectly, look to protect our profits around the objectives of $ 37,000; $ 38,000; $ 39,000 and $ 40,000.

There is still tremendous doom and gloom about Bitcoin and the only reason we are seeing a correction around the spot of $ 35k. But, we expect a possible correction will stay above the price of $35,000. That has fuelled some hope amongst investors and led to the recent intermediate corrective bounce.

Guggenheim CIO Says Bitcoin Could Eventually Climb to $ 600,000. While bitcoin has potential to support a huge valuation long-term, currently there isn't enough institutional involvement, Said Scott Minerd.

But, we say that it's overrated, especially for now. So, in coming days the BTC/USD will try to trade between the levels of $ 35,000 and $ 40,000 on the one-hour chart.

Further close above the high end may cause a rally towards $ 35,000. Nonetheless, the weekly resistance level and zone should be considered. The RSI is still calling for a strong bullish market as well as the current price is also above the moving average 100. Therefore, it will be advantageous to buy above the support area of $ 35,000 or/and $ 36,000 with the first target at $ 37,000.

If the pair closes above the weekly resistance 1 of $ 37,000, the BTC/USD pair may resume it movement to $ 38,000 to test the weekly resistance 2.

Also, it should be noted that some news are very important to know the way of BTC/USD's trading.

Example : Binance Says It Wants to Get More People Using Crypto With Its New Payments Service. The beta Binance Pay product currently allows users to make and receive payments in five cryptocurrencies and the Euro.

Moreover, if the BTC/USD pair succeeds to break through the resistance level of $ 38,000, the market will climb further to $ 39,000.

This would suggest a bullish market because the Stochastic oscillator indicator is still in a positive area and does not show any trend-reversal signs. The pair is expected to drop higher towards at least $ 40.


Forecast

The price spot of $ 35,000 remains a significant support zone. Therefore, a possibility that the BTC/USD pair will have upside momentum is rather convincing and the structure of a scaling does not look corrective.

For this reason, the market of Bitcoin ill be probably call for a strong bearish opportunity above the prices of $ 35,000 & $ 36,000.

Buy above $ 35,000 & $ 36,000 with the first targets at $ 36,00; $ 37,000; $ 38,000, $ 39,000 and the $ 40,000. However, the stop loss should be located above the level of $ 34,500.






Mourad El Keddani
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

ETH/USD makes new all time highs

ETH/USD did not break support level at $1,200, instead price broke above $1,390 and has reached $1,500 as expected and even higher. Price is making new all time highs. Trend remains bullish. In the 4 hour chart we saw the cross of the tenkan-sen above the kijun-sen something that we mentioned would be a bullish signal.



The cross came as price was breaking above the resistance of $1,390 we mentioned in our last post. Support by the tenkan-sen is now at $1,468 and by the kijun-sen at $1,422. A pull back towards these two levels is justified and as long as price is above the cloud, trend will remain bullish in the short-term.



Red lines - bearish RSI divergence

In the Daily chart we take a look at the warning signal by the RSI. The RSI is not making new all times highs as the price. The lower high provides an important warning to bulls. This is a sign of weakening upside momentum. This is not a reversal or sell signal. This is just a warning that bulls should not ignore.



Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021