Cryptocurrency Analysis

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Technical analysis on XRP/USD

Ripple is trading around $0.53 after a strong upward move from $0.17 to $0.75. Price continues making higher highs and higher lows but the major double top around $0.75 is the key level for the bullish trend.



Yellow rectangles- double top resistance

XRP/USD is far from its all time highs. Price has formed a double top at the resistance area of $0.75. Support is at last week's low at $0.41. Bulls need to defend this level and not break below it. Breaking below it could push price even lower back towards $0.20-$0.17. Recapturing $0.75 on a weekly basis will be the most important step for bulls in order to start a strong rally $1,34 which the first target if the break out happens.




Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

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Litecoin Natural Retreat From $239.11 All-Time High

Litecoin dropped as we forecast after reaching 239.11, a new record high. This could still be only a temporary retreat before resuming its upwards movement. Technically, a minor retreat is natural after the last bullish momentum.

The outlook is bullish, so LTC/USD could continue higher after ending the current decline. The price has passed above the 230.81 previous high validating once again that the swing higher is far from being complete.


LTC/USD TEMPORARY DROP!


LTC/USD has come back down to retest the first warning line (WL1) which represented a dynamic resistance. The resistance has turned into support after the most recent breakout.

Consolidation below the WL1 signals that the rate could drop deeper in the short term to test the buyers from the 150% Fibonacci line.

Litecoin could edge higher if stabilizes above the first warning line (WL1). A false breakdown and a minor consolidation could attract more buyers. The next bullish momentum should be towards the R1 (247.20) or higher up to the second warning line (WL2).


LITECOIN TRADING TIPS!

A temporary consolidation above 230.81 signals further growth. A false breakdown with great separation below WL1 represents a bullish signal.

We will have a great long opportunity if LTC/USD closes above 240.00 psychological level. The rate could aim at the R1 (247.20) and higher at the second warning line (WL2).




Ralph Shedler
Analytical expert
InstaForex Group © 2007-2021

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BTC analysis for February 18,.2021 - BTC is on the extended run and there is potential for the downside rotation

Further Development



Analyzing the current trading chart of BTC, I found that the buyers got exhausted in the recent days, which might be indication for the downsdie rotation.


Key Levels:

Resistance: $52,000

Support level: $48,000




Petar Jacimovic
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Forecast for Litecoin – BUY. Monthly gain +4.95%

1. LTC/USDT volume analysis on the Binance Exchange.

In this analysis, we will use the data on horizontal trading volumes from the Binance Exchange on the daily charts. The analysis is based on the footprint-profile theory. According to it, the direction of the level with the highest traded volume during the day can indicate the possible direction of the trend. The level with the highest traded volume is the level where the maximum number of transactions was made. This is the level of major market players. Accordingly, if the maximum volume level moves higher, this indicates an uptrend. A downward movement of this level indicates a downtrend. Chaotic movement signals that the market is trading flat.

16.02.21 – The level of the maximum traded volume (POC – PointOfControl) – 216
16.02.21 – The level of the maximum traded volume (POC – PointOfControl) – 230

POC has moved higher, and the price is holding above the POC level. An uptrend is likely to start, so it is better to open long positions.


2. Analysis of the long-term trend.

A trend is your 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. The classic Dow Theory describes three main trends:

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

You need to analyze these trends before opening any trade. This is what we are going to do in the analysis below. A long-term trend is a trend on the daily chart. Trades will be opened on the daily time frame and held for several days. The analysis of the daily trend is carried out with the help of the EMA(48), an exponential moving average with a period of 48. If the daily candlestick closes above the EMA (48), then we have an uptrend and we should open buy positions. If the daily candlestick closes below the EMA (48), then there is a downtrend and we should go short.



On the chart, we can see a clear uptrend. The price is holding above the EMA(48). In this case, you should consider opening buy positions.


3. Analysis of the medium-term trend.

In our analysis, a medium-term trend will be the trend on the 4-hour chart (H4). EMA(48), an exponential moving average with a period of 48, will also be used for analysis. If the H4 candlestick closes above the EMA(48), then we have an uptrend and we should open buy positions. If the H4 candlestick closes below the EMA(48), then there is a downtrend and we should go short.



The price is located above the EMA(48). This means that the medium-term trend is moving up together with the long-term trend. Therefore, you should open buy positions.


4. Analysis of the short-term trend.

A short-term trend that can also show an entry point into the market is considered a trend on the H1 time frame. Here, we will again use the EMA(48), an exponential moving average with a period of 48. If the H1 candlestick closes above the EMA(48), then there is an uptrend and you should open buy positions. If the H1 candlestick closes below the EMA(48), then there is a downtrend and you should go short.



The price is holding above the EMA(48). The short-term trend is moving up. All the three trends are moving in the same direction which confirms buy positions.


5. Japanese candlestick analysis.

The Japanese candlestick analysis is applied to the daily time frame. In this analysis, we will also analyze the daily candlestick.



The daily candlestick marked with white closed higher. Its high is located above the high of the previous candlestick. The candlestick pattern coincides with the trend, The candlestick has a long body and short shadows. The uptrend is very likely.


6. Conclusion:

Volume analysis - BUY
Long-term trend - BUY
Medium-term trend - BUY
Short-term trend - BUY
Japanese candlestick analysis - BUY

General conclusion: On February 18, 2021, you should consider opening long positions.


7. Statistics

To analyze the effectiveness of this approach, we will keep the data on completed transactions. We prepare forecasts and open our trades on four major instruments: Bitcoin, Ethereum, Litecoin, and BCH/USD. Please, check other articles regarding this topic.

We gained +4.95% in February 2021

We opened a new position:

18.02.21 Litecoin BUY: 229.53 SL: 198.77; the risk management is 1% of the deposit of $10,000, with trading volume of 0.03 lot.

When opening new positions, Stop Loss should be placed beyond the daily extreme points. Do not place Take Profit, as we will continue to move Stop Loss beyond the extreme points in the future sessions. Since the trade is carried out on the daily charts, the recommendation remains relevant throughout the day.

Trade with the trend and you will gain profit!




Maxim Petrov
Analytical expert
InstaForex Group © 2007-2021

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Morning review of cryptocurrencies for February 18, 2021

Today, bitcoin has passed the $52K mark, breaking through the 161.8% Fibo Expansion level. Meanwhile, experts warn of the risks of such a blistering rally. They believe that institutional investors have overestimated demand for the digital currency. It is too early to compare BTC with gold as a safe-haven asset. This means that the market may enter a correction. However, it is not clear when it is going to happen. That is when we should turn to the technical analysis.

Thus, BTC/USD is above yesterday's highs. Apart from that, another flag pattern was formed on the H4 chart. Yet, the quote is still trying to consolidate above 51,870.71, set by the 161.8% Fibo Expansion level.

A downward correction to the support level of 49,690.70 is still highly likely. Otherwise, the price may go up after consolidation above the 161.8% Fibo Expansion level.



Consolidation of Bitcoin Cash in the narrow corridor between 701.47 and 726.76 is still ongoing. Further direction of the pair will determine its way out from this range. It will also depend on whether the upward trend will extend or a correction will occur.

The closest upward target is seen at the horizontal level of 750.13. If the price goes down, it may well reach the support level of 667.95.



Ripple continues to consolidate in the narrow corridor of 0.5345 - 0.5564. If the price leaves this range, it may go to the mirror support level of 0.4769 (the lower blue horizontal line). In case of an upward breakout, the target will remain at 0.5957 (the green horizontal line).



Ethereum has set another record high, breaking through the 161.8% Fibo Expansion level. However, it failed to consolidate above it. The pair is consolidating above the horizontal line. If this level stands as support, the upward trend will extend. In case of a breakout, the nearest target for a downward correction will be set at the 1823,44 horizontal level.



Litecoin touched the resistance level of 239.79, consolidated, and fell to 228.90. The price is now testing the level but all its attempts to break through have been false so far. LTC/USD may well return to the horizontal level of 239.79, if the price fails to break through 228.90.

In case the price gives a reverse signal after a breakout at 228.90 and consolidation below it, the downward target will be set at 219.47.






Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

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Forecast for Ethereum for February 18, 2021

1. Analysis of ETHTUSD volume from Binance cryptocurrency exchange

The analysis is based on the horizontal volumes data on daily charts from the Binance exchange. The analysis is carried out based on the footprint-profile theory. According to the theory, the direction of the horizontal level with the highest trade volume within a day can indicate the likely direction of the trend. The highest trade volume is the level with the largest number of transactions carried out. That is, it is the level of major market players. Accordingly, if the highest trade volume level goes up, it indicates an upward trend. Otherwise, if the highest trade volume level goes down, it indicates a downward trend. Chaotic movements signal that the market is trading flat.

16.02.21 – the highest horizontal volume level; point of control (POC) = 1751
17.02.21 – the highest horizontal volume level; point of control (POC) = 1838

The point of control has moved up. The price level is above the POC. The upward trend seems to have started. Therefore, one can open long positions.


2. Analysis of long-term trend

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

-long-term
-medium-term
-short-term

These are the trends you should analyze before entering the market. Now, let's take a look at these trends.

The long-term trend is the daily trend. In this case, deals are made in the daily time frame and are held for several days. The analysis of the daily trend is made with the help of the 48-period exponential moving average (EMA(48)). If the daily candlestick closes above EMA(48), it will indicate the upward trend. Therefore, you should enter long. If the daily candlestick closes below EMA(48), then it is the downward trend and you should enter short.



The chart indicates a clear upward trend. The price level is above EMA(48). That is why you should consider entering long.


3. Analysis of medium-term trend

The medium-term trend is the trend on the 4-hour chart (H4). In this case, we will also turn to EMA(48). If the candlestick closes above EMA(48) on the 4-hour chart, it will indicate the upward trend. Thus, you should enter long. Otherwise, if the candlestick closes below EMA(48) on the H4 chart, it will indicate the downward trend. Consequently, you should enter short.



The price level is above EMA(48). We have the upward trend. Therefore, one can but the pair.


4. Analysis of short-term trend

A short-term trend is the trend in the H1 time frame. Moreover, it can show an entry point into the market well. We will turn to EMA(48) again. If the candlestick closes above EMA(48) on the H1 chart, it will indicate the upward trend. Thus, you should enter long. Alternatively, if the candlestick closes below EMA(48), it will indicate the downward trend. Consequently, you should enter short.



The price is above EMA(48). We have a short-term downward trend. The long-term, the medium-term, and the short-term trend coincide. Thus, you can open buy deals.


5. Japanese candlestick analysis

A classic Japanese candlestick analysis is applied to the daily timeframe. In this particular analysis, we will also look at the daily candlestick.



Thus, we have a white upward daily candlestick. Its high is above the high of the previous candlestick. The candlestick has long body and small shadows. The downward movement is highly likely.


6. Conclusion

Volume analysis: –> BUY.
Long-term trend –> BUY.
Medium-term trend –> BUY.
Short-term trend –> BUY.
Japanese candlestick analysis –> BUY.

General conclusion: On February 18, 2021 one should buy the pair.


7. Statistics

To analyze how effective this approach is, the data on completed transactions is tracked. The forecast is made for four instruments: Bitcoin, Ethereum, Litecoin, and BCH/USD. Trading account monitoring:



February 2021: +4.95%.

Current deals:

09.02.21 Ethereum BUY: 1781.35; SL: 1543; Risk per deal: 1% of a $10,000 deposit with 0.42 lot.

A Stop Loss for new orders should be placed beyond the daily extreme points. We do not set a Take Profit because we will continue to move the Stop Loss above the extreme points of the upcoming sessions.

Since trading is carried out on daily charts, this recommendation is relevant throughout the day.

Trade with the trend and you will generate profits!





Maxim Petrov
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin's market cap almost hit $1 trillion. First cryptocurrency goes beyond limits

Bitcoin is carrying out a mini revolution in financial markets, holding its positions near $50,000. After two slumps that occurred early this week, experts and market participants predicted a drop to $45,000. However, the digital asset does not obey the market rules. This could be proved by a new record high of Bitcoin's market capitalization.

Just in two hours, the first cryptocurrency skyrocketed by $2,000 to trade at $52,000. Judging by the daily trade volume, Bitcoin's capitalization soared to almost $1 trillion, settling at $970 billion. A new jump in the price took place after the news that the largest holder of Bitcoin intended to invest about $1 billion in the cryptocurrency.

This news proves two obvious facts. Firstly, Bitcoin is riding a wave of luck and benefiting from news about large investments. These facts together with the strong market positions do not allow Bitcoin to return to its previous levels. It was Tesla Motors that gave Bitcoin a strong reason to rise. It was the first to announce large investments in the asset. Moreover, Charlie Lee, a creator of Litecoin, is sure that other big players will also follow the example of Elon Musk. In fact, his predictions have already come true. Investment flows in Bitcoin are increasing every week. Of course, this is reflected in its price.



The second fact is not that positive, but it is still obvious. Bitcoin, like any other cryptocurrency, is extremely volatile. On February 18, at night, the first cryptocurrency surged by $2,000 just in one hour. On February 14, the price of the crypto asset tumbled by 3% in several hours. Next day, it again nosedived by $3,000.

Thus, we can see sharp changes in the price of Bitcoin. They have different time intervals. All this suggests that for the future introduction of cryptocurrencies in financial institutions around the world, we will need appropriate algorithms that will fix certain levels. This will reduce volatility and allow the use of coins in everyday operations. However, it is still unknown whether the cryptocurrency will remain that attractive as it is today. The fact is that these algorithms will affect a rise in digital assets. This is the paradox of cryptocurrencies' volatility. It is possible that we will find out how to solve this problem in the near future.




Artem Petrenko
Analytical expert
InstaForex Group © 2007-2021

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Technical Analysis of ETH/USD for February 18, 2021

Crypto Industry News:
Elon Musk undoubtedly enjoys giving inspirational tweets and wants to colonize Mars. The last action performed by Tesla's CEO combined both elements.

After yesterday's tweet about "MarsCoin", the price of a real Marscoin has increased by over 1000%. The tweet was part of a Dogecoin thread. Changpeng Zhao, the head of the Binance cryptocurrency exchange, suggested that if Musk were to launch the cryptocurrency, it should be called MarsCoin.

It turns out that Marscoin - $ MARS already exists. This is a project that was developed in 2014. After years of trading below $ 0.20, its price surpassed $ 2.50 yesterday and dropped back to $ 0.85 around the time of publication.

The team behind Marscoin has a common goal with Musk: funding the first human settlement on Mars. The brief explanation suggests that humans first mine Marscoin here on Earth, and then when the technology is developed, "a copy of the blockchain can be transferred to Mars."

There is even a photo of Musk on the website, although the FAQ subpage reveals that he is not actually related to the project.

Musk tweeted something similar about Marscoin in December, but it didn't seem to have affected the digital asset's price at the time, which was still stable around $ 0.17.


Technical Market Outlook:
The ETH/USD pair has broken through the short-term trend line resistance located close to the level of $1,800 and hit the level of $1,916. The next target for bulls is seen at the level of $2000. The intraday technical support is currently located at the level of $1,873. Please notice, the level of $1,904 is the 161% Fibonacci extension of the last wave up, so the bulls must continue to move up, otherwise a consolidation will be a reason for bears to try to push the prices down again.

Weekly Pivot Points:
WR3 - $2,286
WR2 - $2,080
WR1 - $1,977

Weekly Pivot - $1,768
WS1 - $1,663
WS2 - $1,454
WS3 - $1,346


Trading Recommendations:
The up trend on the Ethereum continues and the next long term target for ETH/USD is seen at the level of $2,000, so any correction or local pull-back should be used to open the buy orders. Please notice, the up trend starting to go vertical, so the volatility will be higher than average. The bullish scenario is valid as long as the level of $830 is broken.






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

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Technical Analysis of BTC/USD for February 18, 2021

Crypto Industry News:
SynBiotic SE, a German cannabis company, announced that it is following the lead of companies like MicroStrategy and Tesla by shifting some of its liquid cash to Bitcoin.

The company said the move was driven by "legitimate concerns about a massive devaluation of fiat money" due to an "excess growth" of money supply in both Euro and US dollars.

CEO Lars Muller went further, stressing that the decision was not due to the recent appreciation in prices, but that:

(...) we have more confidence in Bitcoin than in the Euro or the dollar, where a central institution, under the influence of politicians, can increase the amount of money. "

He added that the cannabis industry in particular has "very positive experiences with Bitcoin as a simple and digital means of payment" and that several SynBiotic subsidiaries already accept Bitcoin as a tender.

Synbiotic SE is building a diverse group of companies in the cannabis sector with a focus on the synthetic production of cannabinoids and wellness products. It claims to be the first publicly traded company in Germany to invest in Bitcoin as a hedge against fiat devaluation.


Technical Market Outlook:
The BTC/USD pair keeps going up. The recent all time high was made at the level of $52,516 and the next target for Bitcoin is now located at $60,000. In the meantime, the local technical supports are: $45,902 and $50,000. The intraday support is $51,499. However, if the market is out of the main channel and the price is below the level of $43,125 ( overbalance level), then the chance for a deeper correction are high, so please keep an eye on this levels. Please notice, the momentum is now decreasing as the price go up, which might be the beginning for bearish divergence on H4 time frame chart.

Weekly Pivot Points:
WR3 - $65,941
WR2 - $57,841
WR1 - $54,644

Weekly Pivot - $45,671
WS1 - $42,441
WS2 - $34,081
WS3 - $31,183


Trading Recommendations:
The bulls are still in control of the Bitcoin market, so the up trend continues and the next long term target for Bitcoin is seen at the level of $60,000. Any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $41,125 is clearly broken.






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Microstrategy makes investment of $300 million in bitcoin

Just yesterday, we discussed that Microstrategy announced its decision to raise about $600 million through its own securities in order to invest them in bitcoin. Notably, Microstrategy is the largest public holder of bitcoin. About 72,000 coins are placed on its accounts. The company started investing in the digital asset last year. Then, the dazzling rally of bitcoin led to a surge in the market value of the company itself and the growth of its shares. So, the company thought that this was a great chance to generate profit and increase value. Therefore, it decided to raise $600 million. And then another $300 million. Or $900 million? A new release has appeared on the company's website, which reports an increase in investment in bitcoin to $900 million. Some news agencies really believe that we are not talking about a $900 million investment but about an additional $900 million investment that is going to be raised in order to buy BTC. The main activity of the company is business analytics and the development of appropriate software. However, it seems that now it can already be called a crypto investment company.

The example of Tesla and Microstrategy was followed by another company - German SynBiotic SE, whose shares are listed on several stock exchanges. It announced its intention to invest money in bitcoin. The official press release says about the specific reasons for this decision, mainly associated with the current reality. The company believes that an excessive increase in the money supply in the European Union will inevitably lead to the depreciation of fiat money, so it wants to transfer part of its money to bitcoin. The head of the company explained that digital currencies are the exact opposite of traditional currencies as their issue is limited to 21 million coins (meaning bitcoin). He also notes the high degree of security against unauthorized access from the outside. "For this reason, we have more confidence in bitcoin in the long term than in the euro or dollars as the central bank can increase the money supply at any time," Lars Mueller pointed out. The most interesting thing is that SynBiotic SE, like Microstrategy, is not an investment company or a financial company. It is focused on medical cannabis needs. It is also reported that in Germany there are one or two other companies that also invested in bitcoin last year, but did not make public statements about this. Thus, we already know about at least four companies that invest in bitcoin. Undoubtedly, they are going to continue to do so. As the number of companies focused on virtual assets is growing, the rally of bitcoin is likely to continue.




Paolo Greco
Analytical expert
InstaForex Group © 2007-2021