Cryptocurrency Analysis

[IFX_Selena]

Technical Analysis of BTC/USD for 08 February 2021

Crypto Industry News:

According to Glassnode, the average hash rate of the Bitcoin blockchain (BTC) - the total processing power devoted to mining - has reached a new all-time record of over 176 EH / s.

The increase in hash rate can be explained by the increase in the price of bitcoin itself. Miners receive BTC as a reward for mining new blocks. The more a coin costs, the higher the miners' income. Therefore, as the price of BTC rises, miners are encouraged to contribute more to the overall computing power of the network.

Another factor is transaction fees - the second revenue stream for miners. Basically, as trading volumes increase - as they tend to increase in bullish periods - transaction fees also rise. Combined with the price of bitcoin, this further increases the profitability of mining.

As CoinGecko data shows, the rise in the BTC price to USD 38,000 coincided with Friday's hash rate jump. Currently, bitcoin costs around $ 38,600, while its network hash rate has dropped below 165 EH / s, which therefore means that 165 quintillion (18 zeros) hashs are computed every second across the Bitcoin network. By comparison, the hash rate of the network was around 120 EH / s in early 2020 - an increase of nearly 50% in just one year.

However, an increase in the hash rate does not accelerate the discovery of new blocks. This is because the speed of one block per 10 minutes is hard-coded into the Bitcoin blockchain and has remained largely the same for the past 12 years.

To maintain this rate, the Bitcoin network automatically adjusts its difficulty on a regular basis. Thus, even if there is a huge surge in computing power, the process of discovering new blocks will just be proportionally more difficult.


Technical Market Outlook:
The BTC/USD pair has made a new local high at the level of $40,924 in form of a Doji candlestick. Nevertheless, the price was rejected from $40,000 and is currently trading around the level of $38,600. If the level of $40,924 is clearly violated, then bulls might rally straight back to the recent local high located at $42,000 and even break higher towards new ATH. Please notice, the momentum on the RSI indicator is strong and positive, so the bulls are doing their best to resume the up trend.

Weekly Pivot Points:
WR3 - $51,306
WR2 - $46,193
WR1 - $42,645

Weekly Pivot - $37,209
WS1 - $34,108
WS2 - $28,930
WS3 - $25,324


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 $50,000. Any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $30,000 is clearly broken.





Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Forecast and trading signals for Bitcoin on February 8

Bitcoin, H1 chart


Bitcoin continues to trade upwards in the H1 chart, however, it is unlikely that the quotes will manage to break above the current high. But even though the cryptocurrency is far from overcoming the uptrend line, a rebound from it will definitely trigger a continued bullish movement. At the moment though, quotes have gone below the critical line, which somewhat increases the chance that Bitcoin will begin trading downwards soon. To add to that, the cryptocurrency is near its all-time highs, so the market will need new reasons to update them. Hence, the uptrend line is the most important right now, as overcoming it will enable players to pull BTC down, which is ideal since the cryptocurrency has been rising in price for quite a long time already.

In an earlier article, it was mentioned that short positions should be opened once the trendline is broken. But since this scenario did not happen, it was not necessary to trade shorts over the past day. Instead, traders continued to trade long positions in BTC, as a result of which price bounced off of 37721. Now, players can look forward to further increases towards 39936.


Bitcoin, M15 chart


Both linear regression channels moved downwards in the M15 chart. But in the H1 time frame, there is a signal to buy, which means that there is still a chance that Bitcoin will resume trading upwards in the next two days.

In another note, news emerged that many central banks view cryptocurrencies as a threat to the stability of the financial system. They believe that the cryptocurrency market should be tightly controlled and regulated, arguing that it is mostly used to carry out illegal activities. However, in one of the studies conducted at the very beginning of the cryptocurrency boom, experts found out that most illegal transactions use the US dollar more than with all cryptocurrencies combined. Thus, most likely, the heads of the central banks, Ministries of Finance, as well as governments, simply want to control what is beyond their control. They continue to constantly criticize cryptocurrencies in order to reduce demand for them. For example, Andrew Bailey, the head of the Bank of England, has recently joined a cohort of critics, who said that a truly stable and strong cryptocurrency has not yet been created. Bailey believes that as long as cryptocurrencies are not regulated by anything or anyone, they cannot be considered a stable means of payment and full-fledged currencies. Aside from that, he claims that cryptocurrencies were not created to facilitate and reduce the cost of transfers and payments. Yes, they will certainly develop, but only those that will later be tied to fiat money, such as digital currencies like the euro or pound. In any case, demand for cryptocurrencies will continue anyway, and since governments and central banks have not yet found a way to control its circulation, there is a high chance that price will continue to soar in the future. It must not be forgotten though that all cryptocurrencies are very volatile, and its rate is entirely dependent on traders who do not need fundamental information to trade in the market.

Anyhow, there are two trading ideas for February 8:

1) Although bulls have lost control of the market, the upward trend continues. Therefore, it is best to continue opening long positions in BTC/USD, especially after a rebound from the uptrend line. Its targets will be $ 39936 and $ 41,286, while the take profit level is $ 2900. Longs may also be set up after a rebound from $ 37721.

2) Bears are trying to seize the initiative in the market, however, they still lack the strength to move past the trend line. But if it is overcome, then it is ideal to sell to $ 36534, a break below which will bring BTC/USD to $ 34840 and $ 33398. In such a case, take profit as soon as the quote reaches $ 2,400.


Explanations for illustrations:

Support and Resistance Levels - targets when opening long or short positions. Take Profit levels can be placed near them.

Kijun-sen and Senkou Span B lines - lines in the Ichimoku indicator that are transferred from the H4 time frame to the H1 time frame.

Support and resistance areas - areas from which the price has repeatedly bounced off.

Yellow lines - trend lines, trend channels and any other technical patterns.




Paolo Greco
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Forecast and trading signals for Litecoin on February 8


Litecoin H1 frame:


In the hourly time frame, the price of Litecoin cryptocurrency continued to decline on February 8, which was already assumed earlier. However, it was not a very strong one. Litecoin quotes encountered an impassable barrier on their way in the form of the level of 147.43 and rebounded from it twice. Thus, the growth of this cryptocurrency is even more likely. In the last article, we recommended selling Litecoin with targets at 147.43 and 143.95, as the price broke the critical line. The first target was worked out, so traders could get about 290 points. Furthermore, we also recommended to trade up if the price rebounds from one of the levels 147.43 and 143.95. A rebound already occured in the level of 147.43, even twice. In the first case, the price rose to the Kijun-sen line, which allowed traders to earn about 300 more points. A new buy signal in the form of a rebound from the critical line could also be accomplished, but at the time of its formation, the price had already gone up about half the way to the Kijun-sen line. This is not the strongest signal.


Litecoin M15 time frame:


As for the 15-minute time frame, both linear regression channels are directed downward, signaling a short-term downward trend. However, the cryptocurrency failed to break through the level of 147.43 twice. Thus, we are now inclined to return quotes to the critical line. Most likely, the downward movement will only continue after overcoming the level of 147.43.

Litecoin is not the most popular cryptocurrency, but it is in high demand among traders and people who use cryptocurrencies as a means of payment. Unlike Bitcoin, this cryptocurrency hasn't updated its all-time highs in recent months, which were reached back in December 2017. This means that this cryptocurrency is less popular. Its capitalization level is $ 9-10 billion and this is only 1% of the total cryptocurrency market capitalization. Nevertheless, Litecoin is a much quieter cryptocurrency that can be traded with relatively low risks. This coin is inexpensive compared to the same bitcoin, and transactions on it are carried out four times faster, which is also important, given the rate of change in rates. Its properties are very useful in terms of relatively safe trading. It can be recalled that just the other day, Tesla and SpaceX Founder Elon Musk made a statement via his Twitter regarding Bitcoin.

"I am a fan of bitcoin and I think that its financial world is close to recognition, but I have opinions about other crypto-currencies," Musk said. This provoked a strong growth in bitcoin quotes. He also commented on the Dogecoin cryptocurrency, which grew by 50% just an hour after it.

Therefore, when trading any cryptocurrency, traders are advised to never forget about Stop Loss and note that this market is extremely volatile, and the factors that affect the exchange rate of a particular cryptocurrency are unpredictable. For example, it can be the tweets of some crypto billionaire or a major exchange. It is unlikely to predict what and when some major market participant will tell the rest of the market.

Based on the above, two trading recommendations on February 8 can be considered:

1) Buyers stopped taking the lead, but are trying to get it back. Thus, we recommend buying the cryptocurrency again, given that the price rebounds from the upward trend line with the targets at 147.43 and the Kijun-sen line (152.37). In such cases, Take Profit can amount to 975 points. It is also recommended to buy it with targets of 156.43 and 162.13, if the price consolidates above the Kijun-sen line.

2) Bears have taken the first step towards forming a downward trend, but have not yet been able to break through the level of 147.43. Therefore, we recommend trading lower with the support levels of 147.43 and 143.95, if the price rebounds from the Kijun-sen line. In this case, Take Profit can be up to 700 points. In turn, short positions can also be opened with the target of the trend line, if the bears manage to consolidate below the level of 147.43.


Explanations for illustrations:

Price levels of support and resistance (resistance/support) - levels that are targets when opening purchases or sales. It is possible to place Take Profit levels near these levels.

The Kijun-sen and Senkou Span B lines are the Ichimoku indicator lines transferred to the H1 and H4 time frame.

Support and resistance areas - areas where the price has repeatedly rebounded.

Yellow lines - trend lines, trend channels and any other technical patterns.




Paolo Greco
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Forecast and trading signals for Litecoin for February 7-8. Recommendations for Sunday-Monday




#Litecoin 1H.


On the hourly timeframe of February 7, the Litecoin cryptocurrency exchange rate was fixed below one of the two ascending trend lines. Thus, the upward trend is temporarily canceled, the cryptocurrency will now strive for the lower trend line, which lies near the Senkou Span B line of the Ichimoku indicator. Cryptocurrencies are a very specific trading tool. They are traded in a completely different way from regular currencies and currency pairs. They are affected by fewer factors, and they are much more volatile. Therefore, when trading cryptocurrencies, you should always remember about security. None of the currency pairs can double in price within a month or two. Any cryptocurrency can do this in less time. The general technical conclusions are as follows: an upward movement is still more preferable due to the persisting second trend line. Thus, it is now possible to trade down, but from all significant and key supports, a rebound may follow with the resumption of the upward trend. Thus, in the event of such a rebound (clear and accurate), it will be possible to already consider options for long positions. I would also like to note in one of our first articles on cryptocurrencies that technical factors for analysis are almost always in the first place.


#Litecoin 15M.


In the 15-minute timeframe, the lower channel of the linear regression turned down. And if none of the supports (147.43, 143.95, trend line) will be able to keep the cryptocurrency above itself, then the senior channel of linear regression will turn down. Further, the prospects for Litecoin will depend solely on the second trend line on the 4-hour timeframe.

One of the main reasons for the high volatility of any cryptocurrency is the lack of control of its governments and central banks. Of course, theoretically, any central bank or government can prohibit the use of cryptocurrency on its territory, however, this will not affect its turnover around the world and even on the territory of this country. Cryptocurrency has no physical properties, it's just a code. The code can be hidden, placed on a remote server, and there are many other ways. At the same time, despite the huge amounts of capitalization of the largest cryptocurrencies, they are still much less in the world than ordinary, fiat money. Let's say how many trillions of dollars there are in the world? Even if some central bank (as the Fed is now) is going to pour another $ 2 trillion into the economy, this leads to a fluctuation in the euro/dollar exchange rate by 5-10% within a few months. Almost any cryptocurrency can rise in price by 5-10% per day without any reason. Simply because today the demand for a particular cryptocurrency has increased. Of course, central banks want to control cryptocurrencies. For example, the head of the ECB, Christine Lagarde, recently said: "Cryptocurrencies are a very speculative asset, with the help of which strange business is conducted, as well as money laundering activities. It is necessary to create global rules for the regulation of cryptocurrencies because if there are certain loopholes, they will be used by illegal organizations and individual criminal persons. There must be global cooperation and concerted action on this issue. First, coordinated action by the G7 countries is required, and then the list of countries can be expanded to the G20. But this problem needs to be addressed." However, while the turnover of cryptocurrencies is not controlled in any way, all of them (at least the main ones) will tend to grow in the long term. If only because their coins are no longer available, and the demand continues to grow.

Based on all of the above, we have two trading ideas for February 7-8:

1) Buyers let the initiative out of their hands. Thus, we recommend buying the cryptocurrency again in the event of a price rebound from one of the supports - 147.43, 143.95 or an ascending trend line with the targets of the Kijun-sen line (152.37) and the maximum level of 156.43. Take Profit in these cases can range from 400 to 1200 points.

2) The bears tried to seize the initiative in the market and took the first step towards the formation of a downward trend segment. Therefore, we recommend trading downwards with the support levels of 147.43 and 143.95 as long as the price does not consolidate above the Kijun-sen line. Take Profit in this case can be up to 7,300 points. Also, short positions can be opened with the targets of the Kijun-sen line (152.37) and the level of 147.43 with a clear rebound from the level of 156.43.

Forecast and trading signals for Bitcoin.

Explanation of the illustrations:

Price levels of support and resistance (resistance/support) – target levels when opening purchases or sales. You can place Take Profit levels near them.

Kijun-sen and Senkou Span B lines – the lines of the Ichimoku indicator, moved to the hourly timeframe from the 4-hour one.

Support and resistance areas – areas from which the price has repeatedly bounced before.

Yellow lines – trend lines, trend channels, and any other technical patterns.




Paolo Greco
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical analysis BTC/USD for February 07, 2021



Bitcoin (Cryptocurrency) Forecast

BTC/USD - Bitcoin US Dollar
Bitcoin is likely to reach $50,000 before April, 2021, but the bulls must break through $40,920 in order to resume the up trend.

Our dedicated contributors expect a modestly bullish outlook, forecasting price stability after this week's clear rally. The average outlook for the pair was trading above the area of $37,000 - $37,500.

BTC/USD relatively pushes in an uptrend around the recent upper range-line at the price of $40,920 (last bullish wave).

Last week, BTC/USD declines after failing to break the resisitance level at $40,920 (top price).

Following the rdemanding of the $38,219 support and the clearing of the $40,920 resistance, BTC/USD price rallied to the psychological price level of $40,920.

The upward move could not be sustained as Bitcoin faces rejection. Bitcoin price is retracing and may find support above $38,219.

On the upside, if the bulls have broken the resistance level ($39,000), the upside momentum would have resumed. The next target price would have been the $40,920 high.

However, as price retraces, it may find support above $38,219 for the continuation of the upward move.

Further close above the high end may cause a rally towards $38,219. Nonetheless, the weekly resistance level and zone should be considered.

Currently, the price is in a bullish channel. This is confirmed by the RSI indicator signaling that we are still in a bullish trending market.

The bias remains bearish in the nearest term testing $40,000 and $40,920. Immediate resistance is seen around $39,000 levels, which coincides with the weekly pivot.

Moreover, the moving average (100) starts signaling an upward trend; therefore, the market is indicating a bullish opportunity above $38,219. So it will be good to buy at $38,219 with the first target of $39,500.

It will also call for a downtrend in order to continue towards $40,000. The strong weekly support is seen at $40,920.

However, if a breakout happens at the resistance level of $37, 000, then this scenario may be invalidated.

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Crypto industry news (Ethereum News - (Source : cryptonews - coindesk))

1) Bitcoin Back Above $40K as Institutions Lead the Way.
BTC is back within striking distance of its all-time high set early last month.

2) Serbian Man Extradited to US After Being Indicted in $70M Crypto Fraud
The scheme allegedly included offering bitcoin at "half market price."

3) Bitcoin Market Cap May Be 'Overstated' by USD 151Bn - Coin Metrics.
Bitcoin (BTC) market capitalization may be overstated by USD 151.5bn, according to data from the crypto intelligence firm Coin Metrics. And the same may well go for the token's forks, the company suggested.

Coin Metrics arrived at this staggering figure by looking at how many coins may actually be on the market. Per a tweet from the firm, Coin Metrics said that it was "widely understood that whilst there are 18.6m bitcoin in existence, many are lost and not available to the market anymore."

Instead, the firm introduced a free float supply model, claiming that contrary to more conventional figures, "a more realistic representation" of bitcoin's supply would be 14.5m.

4) Spanish Tax Body Will Force Citizens to Declare Overseas Crypto Holdings.
The Spanish Tax Agency – known in the nation as the Hacienda – has announced its intentions to step up its monitoring of crypto, and will move to force citizens and residents alike to declare their bitcoin (BTC) and altcoin holdings, even if those are held on overseas-based platforms.

Per El Economista, the Hacienda has recently outlined its plans for 2021, and appears to suggest that it will apply Modelo 720 rulings to crypto holdings as of this year. The Modelo 720 is a declaration of overseas assets, held outside Spanish territory. Citizens must complete and submit the form if they are receiving money from companies based overseas, hold real estate outside the country or keep bank accounts in other nations.

And now, this declaration will be applied to crypto and digital assets, as the body also "expands its surveillance" and will demand crypto holders hand over information on their assets.

The much-maligned Modelo 720 system has come under fire from political rivals and critics, who claim that it is unfair – and a Brussels-based EU court has also begun looking into its legality.




Mourad El Keddani
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical analysis of ETH/USD for February 06, 2021



Technical market outlook of Ethereum (cryptocurrency)

Trading Ethereum (ETH/USD)
Since three weeks ETH/USD increased within an up channel, for that Ethereum hits new highs $1,513, $1,571 and $1,650.

Ethereum price had a significant breakout above the price of $1,513, $1,571 and $1,650. So, the support levels are seen at $1,513, $1,571 and $1,650 on the H1 chart.

Ethereum price is bullish but climbing higher will be strict, our next traget $2,000.

Also, it should be noted that some news said : the trust fund has added around 25,000 ETH right after opening worth around $37 million.

From this point, we guess there are some positive metrics in favor of ETH as well.

Ethereum continues moving in a bullish trend from the support levels of $1,571 and $1,650. Currently, the price is in a bullish channel.

This is confirmed by the RSI indicator signaling that we are still in a bullish trending market. As the price is still above the moving average (100), immediate support is seen at $1,571, which coincides with a golden ratio (61.8% of Fibonacci).

Consequently, the first support is set at the level of $1,571. Hence, the market is likely to show signs of a bullish trend around the spot of $1,571.

Signal
Buy orders are recommended above the golden ratio ($1,571) with the first target at the level of $1,757. Furthermore, if the trend is able to breakout through the first resistance level of $1,757. We should see the pair climbing towards the double top ($1,757) to test it. The pair will move upwards continuing the development of the bullish trend to the level $1,800. It might be noted that the level of $1,900 is a good place to take profit because it will form a new double top in coming hours.

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Crypto industry news (Ethereum News - (Source : Bloomberg))

Ethereum's recent gains have been supported by an ever-increasing level of futures open interest. As CoinTelegraph reports, open interest on Ether futures reached a record $6.5 billion, which is a 128% monthly increase.

This suggests short-sellers are likely fully hedged, taking benefit of the futures premium, instead of effectively expecting a downside.

Professional investors using the strategy described above are essentially doing cash and carry trades which consist of buying the underlying asset and simultaneously selling futures contracts.

These arbitrage positions usually do not present liquidation risks. Therefore, the current surge in open interest during a strong rally is a positive indicator. Tyler Durden Sat, 02/06/2021 - 11:25




Mourad El Keddani
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Trading Signal for BTC/USD for February 05 - 08, 2021: Short-term target at $40,625



The BTC / USD pair is trading with a strong uptrend, since the correction it made in the area of $ 32000 we have noticed a recovery of bitcoin, now it is trading above 8/8 of murray, with the following target at + 1 / Murray 8 about $ 40,625.

The BTC / USD has two upward trends, both are intact, however it is reaching overbought levels, as the eagle indicator is approaching 95 levels, being a sign of an imminent correction in the short term.

If the BTC makes a correction towards the area of the SMA of 21 it will be a good option to buy in this area of $ 36,450, on the other hand, a break of the secondary bullish trend channel, expect a correction to the area of the 200 EMA.

The 200 EMA area will be a good buying point in the short term, as a correction is expected for a new bullish wave to levels of $ 40625 (+1/8 of murray).


Support And Resistance Levels For February 05 - 08, 2021

Resistance (1) $38,786
Resistance (2) $40,145
Resistance (3) $41,299

Support (1) $37,475
Support (2) $36,274
Support (3) $34,963



Dimitrios Zappas
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Trading Signal for XRP/USD for February 05 - 08, 2021: Short-term target at 0.5859



In the 4-hour chart we note that Ripple (XRP / USD) made a maximum in the 0.7350 area, then had a fall of more than 50% to the support levels of 0.35, this volatility is an anticipation of what could happen in the medium term with Ripple.

This morning of February 5, it is trading above its uptrend channel on the 4-hour chart and above Murray's 4/8 and the 21 SMA, which is a strong signal that the XRP / USD could have a target in the short term, up to the 0.5859 zone of the 6/8 of Murray.

The eagle indicator is showing a bullish signal for Ripple, it is at 50% of its signal and it is likely that this pair will reach levels of 0.70 to enter an overbought, therefore it would be a good option to continue buying XRP / USD.

Our recommendation is to buy XRP / USD if there is a correction to the trend line or the 21 SMA, those zones will be good buying points in the short term.


Support And Resistance Levels For February 05 - 08, 2021

Resistance (1) $0.5001
Resistance (2) $0.5308
Resistance (3) $0.5796

Support (1) $0.3998
Support (2) $0.3466
Support (3) $0.3159



Dimitrios Zappas
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical Analysis of BTC/USD for 05 February 2021

Crypto Industry News:

OKEx Insights researchers looked at on-chain data from the Catallact financial intelligence platform. The report noted that the number of transactions above 1000 BTC increased from just over 5% to over 45% in September 2020 and remained in the range of 30% -40%.

"The lesson we can draw from this data is that institutional investors really fell into the BTC space after Paul Tudor Jones announced his entry - and they didn't stop when 2020 drew to a close. Additionally, we can assume that institutions were at the end of the offer spectrum and were buying large amounts of BTC - as opposed to selling - as the price of the leading cryptocurrency rose parabolically throughout the fourth quarter of 2020. "

To underpin the analysis foundations, OKEx compares on-chain data to some large, verified institutional purchases.

"To start with, we know for sure that MicroStrategy, a business intelligence, mobile software and cloud services company, invested large sums of money in BTC last year. In August 2020, the company purchased 21,000 coins for $ 250 million. This coincides with the increase in large transactions in the above-mentioned charts.

The next few purchases from MicroStrategy took place in 2020. On December 5, the company purchased 2,574 BTC for $ 50 million at an average price of $ 19,427 per coin. Later, on December 22, she bought a further 29,646 coins for $ 650 million at an average price of about $ 21,925 each. Moreover, Massachusetts Mutual Life Insurance Company invested $ 100 million in BTC in December. At that time, more and more institutional investors entered the market. "

The report also looks at the selling side to see which entities have liquidated their resources while institutions have been buying large amounts of BTC. Researchers found that the average age of BTCs involved in trades increased in October 2020 and remained high until the end of the year, suggesting that long-term breeders started selling.

"As the supply side of BTC failed to meet institutional demand, as the leading cryptocurrency entered the discovery phase of previously unknown price levels, the coins sold apparently came from both long-term Bitcoin holders and miners. In other words, the old bitcoiners have sold some of their old resources to new institutional buyers [...] - for good or bad.


Technical Market Outlook:
The BTC/USD pair has broken through the long-term trend line resistance around the level of $36,872. The new local high was made at the level of $38,677 in form of a Pin Bar candlestick. If the level of $38,862 is clearly violated, then bulls might rally straight back to the recent local high located at $39,967 and even break higher. Please notice, the momentum on the RSI indicator is strong and positive, so the bulls are doing their best to resume the up trend.

Weekly Pivot Points:
WR3 - $46,671
WR2 - $42,502
WR1 - $37,109

Weekly Pivot - $33,428
WS1 - $27,789
WS2 - $23,603
WS3 - $18,571


Trading Recommendations:
Despite the recent corrective cycle the bulls are still in control of the market. The up trend continues and the next long term target for Bitcoin is seen at the level of $50,000, so any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $20,000 is clearly broken.






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for 05 February 2021

Crypto Industry News:
Could high gas charges, in relation to the current Ethereum price, actually be a sign of potential gains?

Grayscale's research report "Valuing Ethereum" found Ethereum "is actually getting cheaper" in terms of price-to-sale ratio.

The price-to-sell (P / S) ratio is calculated by dividing the market capitalization of an asset by its sales revenue. In this case, dividing the 184 billion Ethereum market capitalization by the total transaction fee revenue yields a similar ratio. The lower the P / S ratio, the more attractive the investment (although there is some debate as to how this time signature can be applied to decentralized digital assets).

According to the Grayscale report, the Ethereum P / S ratio was the lowest in more than three years in early 2021 at around 0.02.

Although Ethereum is not a company and transaction fees are technically not income, institutional grade investment instruments such as those from Grayscale often use traditional analytical methods to help value assets. The report reads:

"A lower ratio indicates that the network is generating high revenues compared to ethereum's historic market capitalization and may therefore be undervalued."

It's worth remembering the tremendous effort put into lowering ETH fees with Eth2, Tier 2 Scaling, and EIP-1559 Ethereum. Either way, high transaction fees point to high demand online, which is good news for miners and hodlers. According to BitInfoCharts, the average Ethereum transaction fee has risen to a record high of around $ 23. This makes using the web completely unprofitable for smaller trades, eliminating the high DeFi activity for the average trader or investor.


Technical Market Outlook:
The ETH/USD pair has made a new all time high at the level of $1,693 and is currently consolidating the recent gains. The next target for bulls is seen at the level of $1,755 which is a 127% Fibonacci extension of the last wave up. The key technical support is located at the level of $1,414 (2017 high). The intraday support is located at $1,558. The momentum is strong and positive and the long term up trend is still intact and there is no indication of trend reversal or termination.

Weekly Pivot Points:
WR3 - $1,679
WR2 - $1,589
WR1 - $1,419

Weekly Pivot - $1,318
WS1 - $1,150
WS2 - $1,040
WS3 - $882


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