Cryptocurrency Analysis

[IFX_Selena]

Bitcoin and Ethereum: Emotions push speculators to aggressive trading



Over the past few days, speculators have taken over the market, and this is justified because of the strong information flow.

Let's start analyzing the flight with insider information about Amazon's plans to implement a system for accepting payments in cryptocurrency by the end of this year. This falls under the flash news category since we are dealing with an e-commerce giant and its volume can do a lot. Naturally, cryptocurrencies (Bitcoin & Ethereum) flew 15% to such news, inspiring even the most pessimistic traders. The joy was short-lived, the news was denied by Amazon itself that they are showing an interest in cryptocurrency, but the company has no specific plans for cryptocurrencies.

At this stage, a flurry of sellers arose, where bitcoin and ethereum plummeted by about 11%.

In this whole burning story, it is interesting that even during the past week, Amazon opened a job posting for a product manager in the field of digital currencies and blockchain.

In simple words, the story about the insider may actually be a fact, but Amazon just can't advertise this fact in vain yet, so it denies it.

The interest in cryptocurrencies is undeniable, this proves the wide interest in digital assets among qualified market participants, but progress will not end there, and perhaps in the near future we will see the use of cryptocurrencies in everyday life.

Another interesting news is the appeal of Twitter CEO Jack Dorsey to investors, where he stressed that bitcoin will be a big part of the company's future, as he sees opportunities for integrating cryptocurrency into existing Twitter products and services, including trade, subscriptions and other new additions, such as Twitter Tip Jar and Super Follows.

It seems like something truly grandiose is happening behind the scenes, and soon the cryptocurrency will acquire an even stronger foundation.

What is happening on the Bitcoin and Ethereum trading charts?

After a rapid growth, bitcoin quotes reached the $40,000 area, where there was a decrease in the volume of long positions and correction by 10%. In terms of market cycles, strong price changes are observed that have not been seen in a long time. Analyze the change in the quotes along the upward trajectory over the past months and you will see that a similar movement was last observed in early spring.

In simple terms, the cycles from July 20 to July 26 reminds of bullish interest, despite a bearish market. This creates a resonance, is there a reversal signal?

This question is now facing many trailers and the market as a whole, but in order not to rush to conclusions, many traders are waiting for the price to hold above the $43,000 mark, which, quite possibly, will indicate a reversal.

Ethereum, following bitcoin, is showing increased upward interest, strengthening its position by about 40% in the peak from July 20 to July 26. The maximum level is considered to be at 2,433, after which a pullback of 11.5% occurred.

Please note that the reduction in the volume of long positions occurred in the area of the local high on July 7, where a price reversal occurred in history.

In this situation, many traders will monitor the $2,400 / $2,450 price area for a breakout, since if the price is kept higher, the path towards the psychological mark of $3,000 will open for us.

Summarizing all of the above, the market is dominated by a positive background, which in the long term may change the bearish interest in the market.






Gven Podolsky
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

BTC unsuccessfully retested $40,500 and rolled back 8% amid weak on-chain indicators and negative news: analysis and prospects

On Tuesday, July 27, the indicators of the first cryptocurrency were close to the end of the bearish phase, when the asset broke through the $40,000 mark. However, bitcoin failed to gain a foothold above the resistance level of $40,500. As a result, the coin fell by 2% and rolled back to the safe zone around $37,000. The main reason for the local collapse of bitcoin was the news background, which was full of unpleasant news and refutations.



On July 26, BTC closed at $39,600 and consolidated the price to successfully overcome the $40,000 mark. However, bitcoin failed to break through an important psychological milestone, after which there was a rebound, which was aggravated by news announcements that arrived in time. A few days ago, there were rumors that Amazon plans to introduce BTC as a means of payment. Many experts agreed that the growth of the cryptocurrency was partly due to these rumors and therefore was perceived critically. However, now we see that the impact of an unverified news feed on the market has been exaggerated. Indirectly, the refutation from the corporation affected the trading volumes, which sagged significantly during the company's announcement, which exacerbated the drop in bitcoin.

In addition, other negative news appeared on the market, which could put additional pressure on the asset's quotes. It is worth noting the statement of the IMF officials, who said that the introduction of BTC as an official means of payment could seriously harm the country's macroeconomy. The department is confident that cryptocurrencies are an "easy but not safe" way to simplify financial transactions. The IMF considers bitcoin to be a volatile and highly speculative asset. If the statement of the financial institution affects European markets, then Tesla's report could deal a powerful blow to bitcoin quotes. Tesla has reported a loss of $23 million amid bitcoin fluctuations. While this figure looks ridiculous, given the company's total profit of $1.14 billion, a comparison with the indicators of the first quarter of 2021 suggests itself. Then Tesla earned $100 million on buying bitcoin. It should be noted that the news announcements, although negative, are unlikely to seriously affect the current market sentiment.

The optimistic prospect in bitcoin lies in its statistical indicators. First of all, it is worth noting that after the local collapse, there is a significant increase in on-chain indicators in the cryptocurrency network. The number of unique addresses in contact with BTC during the day has increased to 930,000, which indicates a powerful upward trend in the growth of on-chain indicators. The number of active addresses on the BTC network also surpassed the 900,000 mark, and the rates of addresses spending bitcoin remain low. This indicates a bullish market sentiment and a continued rally in bitcoin quotes. Positive dynamics is also visible in the behavior of large cryptocurrency holders. Over the past ten days, the whales have purchased 40,000 bitcoins, and the total investment in the last 6 weeks amounted to $6.3 billion. Also, do not forget about the recent short squeeze that launched a new phase of accumulation. In the short term, this will allow to completely level the distance between the real value of BTC and on-chain indicators.



As of 11:00 UTC, bitcoin is quoted at around $37,500. The asset has faced serious resistance and is trying to consolidate the price for another attempt to jump by $40,500. Gradually, the hourly dynamics of price changes become positive, and the main technical indicators on the one-hour chart indicate the formation of bullish signals. In the four-hour time frame, the situation with the cryptocurrency is more complicated due to the strong pressure of the correctional area and the possible profit taking by some players. In the short term, bitcoin will be able to approach the $40,000 mark and try to break it. However, judging by the growing rates of accumulation, the market is not yet ready to push the coin beyond $40,500.






Artem Petrenko
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

A criminal case for the entire cryptocurrency market. Tether under attack

The bitcoin exchange rate quickly fell by half after a rapid growth that occurred amid speculation about Amazon, which allegedly would start using bitcoin in settlements this year. However, by the evening, the company's representatives said that no one is going to take such steps yet and they do not plan to accept the world's first cryptocurrency for payment, at least for this year.

However, the biggest risk for bitcoin this week may be a hawkish surprise from the Federal Reserve. Analysts suggest that this is the reason why yesterday we were unable to take the psychological mark of 40,000. The Federal Reserve System will announce its decision tomorrow, but it is unlikely that anything significant will change in its monetary policy, so do not expect surprises in this direction, which can help strengthen the position of bitcoin.

In my recent reviews, I have written several times about stablecoins and what awaits them in the near future. And now, apparently, this future has come. Let me remind you that stablecoin is a form of digital cryptocurrency with a fixed price, usually completely tied to one dollar or other currencies in which they are issued. At the end of May this year (against the background of the peak of the cryptocurrency market), the total market capitalization of stablecoins, including those offered by cryptocurrency firms Tether and Center, exceeded $100 billion.



Such a turnover of funds that are not controlled by anyone clearly causes concerns on the part of the regulator. Recently, lawmakers and Federal Reserve officials have repeatedly expressed concern that some consumers will not actually be protected if one of the firms that produce stablecoins suddenly starts having problems. They are also worried that the growing size of stablecoins creates a situation where, a huge number of coins equivalent to the US dollar are exchanged without affecting the US banking system, which creates a good ground for financing criminal schemes.

And now the US authorities have moved from talks to actions. According to the latest reports, an investigation has been launched against Tether in the United States, in which it will be established whether the leaders of this company committed bank fraud related to this token. A potential criminal case will have serious consequences for the cryptocurrency market. The authorities of many countries are now seriously concerned about their own digital currencies, and companies like Tether are standing in their way.

Tether's key role in the crypto ecosystem is well known as the token is widely used to trade bitcoin. But the Department of Justice's investigation focuses on events that took place many years ago, when Tether was in its early stages. Apparently, there is nothing to catch on to now. In particular, federal prosecutors are investigating whether Tether was hiding cryptocurrency-related transactions from banks. As I noted above, the criminal charge will be one of the most significant developments in the US government's fight against virtual currencies. Tether is currently the most popular stablecoin. The importance of the token for the market is obvious: about $62 billion worth of Tether is in circulation, and they account for more than half of all transactions with cryptocurrencies.

"Tether regularly engages in an open dialogue with law enforcement agencies, including the Department of Justice, as part of our commitment to cooperation and transparency," the company said in a statement.

However, both the US Treasury and the Federal Reserve are among those interested institutions that believe that this kind of virtual currencies could threaten financial stability.



As for the technical picture of bitcoin, yesterday's sharp breakout of the $35,900 level and growth to the $39,000 area leaves quite a lot of hope that the bulls will once again test resistance at $41,100 in the near future. A breakout and exit beyond this range will open a straight path to the highs of $46,700 and $52,000. So far, we are watching the return of pressure on bitcoin. The bulls will need to try not to let BTC go below the support at $36,700, for which an active struggle is now underway. If the rate goes below this level, most likely, the pressure on the world's first cryptocurrency will return, and we will see an update of support at $33,300 and then a retest of $29,200, which will be the last blow to the hopes of buyers for the rapid growth of the cryptocurrency. So far, everything is turning in favor of the bulls. Let's see what happens to volatility next.





Jakub Novak
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Trading Signal for Ethereum, ETH, for July 27 - 28, 2021: Buy above $2,187



The Ethereum ETH / USD is trading above the 2/8 murray and above the 21 SMA, showing bullish strength, although the eagle indicator is showing an overbought signal.

The cryptocurrency market received a bullish boost on Sunday, following news from an anonymous source within Amazon that proclaimed that the company is planning to accept payments in Bitcoin by the end of 2021.

This news was very favorable for BTC. Other cryptocurrencies quickly followed suit. In particular, Ethereum gained momentum to break above the resistance level of 2,187.

Although we believe that only the market was waiting for some pretext, or it could be a bubble for a stronger fall in the medium term.

Although the institutional recognition of digital assets like Ethereum is on the rise, some analysts still see cryptocurrencies only as a speculative asset. Man Group CEO said that cryptocurrencies are a pure trading instrument with no inherent value.

Ethereum has tested the zone $2,187, there is 2/8 of murray, you can see the break and pullback on the chart. Sustained buying by the bulls has pushed the price above the 2,187 level and is now targeting the 4/8 of murray around $2,500 in the short term.

Our recommendation is to buy if ETH bounces in the area where the 21 and 2/8 Murray SMA converge with targets at 2,500. If it exceeds this level, analysts believe that it could quickly rise to the psychological level of $ 3,000.


Support and Resistance Levels for July 27 - 28, 2021
Resistance (3) 2,501
Resistance (2) 2,411
Resistance (1) 2,326

Support (1) 2,124
Support (2) 1,990
Support (3) 1,843




Dimitrios Zappas
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin analysis for July 27. Tesla sold 23 million bitcoins



The wave counting of the 4-hour chart of the bitcoin cryptocurrency does not have a completely standard appearance, but at the same time, it is quite clear. The instrument is moved exclusively by three-wave corrective structures of different sizes. All these structures are clearly visible in the picture. Based on this and the fact that the instrument failed to make a successful attempt to break through the 100.0% Fibonacci level, I assume that the construction of a new three-wave trend section has now begun, this time an upward one. If this is indeed the case, then the proposed wave a may already be completed. If this assumption is correct, then the construction of a corrective downward wave b has already begun with targets located near the $34,229 mark, which corresponds to 50.0% Fibonacci level. After that, the instrument may make another attempt to rise to the 38.2% Fibonacci level within the framework of the expected wave c.

The news background for bitcoin in the past few days has not been the most favorable, nevertheless, it has improved compared to recent months. For a second, the markets put the news of the repression of miners in China out of their heads, as well as the uncertainty with the US legislation regarding cryptocurrencies. But they drew attention to the recent speeches of Elon Musk, the message that Tesla may return to selling electric cars for bitcoins. The reluctance of large investors to maintain sales below $30,000 was also taken into account. All these factors together supported the main cryptocurrency, although, from my point of view, it will not become the beginning of a new upward trend section. The graph clearly shows that even over the past few months, when bitcoin quotes have already dropped to the area of $30,000-$40,000, upward waves have been repeatedly built, very similar to the one that was built in the last few days.

Thus, the increase in the price of bitcoin should not surprise the markets, nor should it lead to conclusions that do not actually exist. From my point of view, a set of corrective upward waves is simply being built. Bitcoin cannot constantly decline or rise. Thus, I do not expect even more than three upward waves. In addition, the important level of $41,500 has already prevented the instrument from moving higher several times. It is likely that this time the corrective set of waves will be completed around it. I would also like to draw your attention to the absence of strong news background in recent days. Elon Musk's statements are of great importance for the cryptocurrency market, but they are not important enough to force the markets to buy bitcoins in batches again. In general, no matter from which side you look, it all comes down to the fact that the increase in quotes is temporary. Even the message that Tesla sold $23 million worth of bitcoins in the second quarter is more important than Elon Musk's statements.

Based on the analysis, I believe that the next three downward wave structure has completed its construction near the 100.0% Fibonacci level. Thus, the construction of the new three upward waves has now begun. The first wave of this three may already be completed, thus, near the 38.2% level, one could catch a downward reversal with targets located near the $34,229 level. And after completing the construction of wave b, you should catch an upward reversal to build wave c with targets around $41,500.




Chin Zhao
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin: Bearish divergence looming

Bitcoin's breakout of the resistance level at the 31,082.82 - 38,610.88 corridor (marked with red dotted lines) on Monday turned out to be false. But as of today, on the daily chart, the growth has not stopped, and a second attempt is possible.

Meanwhile, network analysts note that the metrics are beginning to form a kind of bearish divergence towards the price. It looks like recent growth has had little impact on these networks. They do not yet show any signs of increased activity, or active growth in demand. Hibernation is evidently in the circuit.

Thus, the number of addresses interacting with BTC has been steadily decreasing during the week, having fallen by almost 26% to 632,000. But now there is a recovery, and the number of active addresses has already grown to 770,000.

Thus, the decline in the number of active bitcoin addresses is at odds with the upward trend in price - here's a potential bearish divergence. Experts point out that even though bitcoin looks very optimistic, it needs an increase in activity at the network level to sustain this rally. Santiment reports indicate that this is often considered an indicator of demand.

Moreover, while bitcoin was recovering last week, the number of unique bitcoins moving daily on the network was moving in a downward trend. There were about 71,600 compared to 328,000 coins in May.

The fall in bitcoin turnover suggests that coin holders are inactive, while the total "value" moved is constantly decreasing.

Analysts believe that despite the concerns these indicators provide, it may take some time for the latest rally to reflect online. However, if network activity continues to decline, it will hamper the subsequent recovery of the main cryptocurrency.

It is worth noting that technical analysis does not give us confidence in the further growth of bitcoin. The sideways growth forecast of 31,082.82 - 38,610.88 has been worked out, there is another strong resistance at 41,980.24, where the price can reach. And only in the case of its true breakout and resistance, will it be possible to talk about the growth of bitcoin. In the meantime, this is only recovery, the return of losses in the sideways.

Meanwhile, 41,980.24 remains a strong mirror level. And a strong news driver is necessary for its breakdown. The current growth also took place under the influence of catalysts, but this is more a help of a technical trend than a breakdown of the picture.

What can we expect from bitcoin? Drivers are difficult to predict. But the technical picture can be relied on. Now, in my opinion, it is worth preparing for a downward reversal. And it will happen either from the level of 38,610.88 - the current resistance marked with a red dotted line, or from a strong mirror resistance at 41,980.24.

And yes, it is not yet time to buy bitcoin. Buying will be appropriate only if it consolidates above 41,980.24. Selling looks more likely, the main thing is to understand where the reversal will take place and wait for a good entry point, ideally with a small stop loss. But there is no need to rush.







Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Has XRP/USD made an important long-term low?

Cryptocurrencies this week have drawn the attention of buyers and it seems that volatility is rising and we are close to a new trend starting. Most cryptocurrencies have broken short-term resistance levels and provided a bullish signal after a long time.



Blue lines - Fibonacci retracement

XRPUSD has also broken out of its short-term bearish channel providing a the first reversal signal after a long time. XRPUSD is reversing from the 78.6% Fibonacci retracement of the entire upward move from December 2020 lows to April 2021 highs. It is too early to tell if price made a major low at recent lowest levels or this is just a short-term bounce in progress. Cryptocurrencies usually make deep pull backs after up trends and it is not strange to see a 78.6% retracement. Having this in mind, there are many chances that the low is in for XRPUSD.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Jack Dorsey wants to integrate Bitcoin on Twitter



One of the most ardent crypto experts and bitcoin fans, Jack Dorsey, said that bitcoin can play a significant role in the future of Twitter. Jack Dorsey is known for being one of the most significant fans of bitcoin and a holder with experience. His company Square is working on creating a wallet for storing BTC, as well as on launching a Bitcoin DeFi platform.

At the B Word conference, Elon Musk, Dorsey and Katie Wood discussed the future of bitcoin and came to a consensus that bitcoin has very good growth prospects in 2021.

Dorsey continues to praise bitcoin and sing its praises. This year, his company has already bought about 3,300 bitcoins worth about $170 million. It seems that Dorsey either believes very blindly in cryptocurrency, or he really knows something that others cannot understand.

On Thursday, at a teleconference on Twitter, Dorsey began talking about clean energy, the environmental orientation of bitcoin, mining, and he also mentioned that digital gold can be included in Twitter products and services. This may mean that this year Dorsey will launch a large-scale process to integrate cryptocurrency into his system.

Dorsey is certain that bitcoin is ahead of all other altcoins, the crypto asset is truly the national currency of the Internet. The properties of bitcoin will allow institutions to conduct business from anywhere in the world.

Dorsey said on a teleconference: "I believe that this is an integral part of our future. In my subjective opinion, there are many innovations in the 21st century in addition to fiat funds that need to be stored, especially when we think about the global decentralization of social networks and the provision of additional economic incentives. Therefore, I think that this is a subject of extraordinary importance for Twitter and the shareholders of the social network to actively invest in bitcoin."

Twitter is planning to integrate bitcoin with its products in the very near future, such as Commerce, Subscriptions, Super-Subscribers, and a Tip Bank.





Vitaly Kolesnikov
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Technical analysis of Bitcoin for July 28, 2021



Bitcoin likely completed a wave 4 correction with the test of 28,600 and should be testing resistance at 41,342 soon and a break above here will indicate the completion of wave 4 and the onset of wave 5 to above the peak of wave 3 at 58,354 and likely much higher to just below 100,000.

Despite the huge decline from the 64,895 peak the uptrend remains firmly in place and should take us way above 64,895 once wave 5 really starts to take off.


Trading recommendation:
Buy Bitcoin above 41,342 for a wave 5 rally to above 64,895




Torben Melsted
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin returns to $40,000. The moment of truth has come!



Over the past few days, bitcoin has shown a movement in its best traditions. There was no really important fundamental background these days. There was only a conference where Jack Dorsey, Elon Musk, and Cathie Wood spoke, there was only news from Tesla and SpaceX, as well as the news from Amazon. This was quite enough for bitcoin to rise in price by $10,000. However, as we have already said in previous articles, it is far from a fact that the upward movement will continue above the level of $40,700, which is the upper limit of the side channel of $29,700 - $40,700. Of course, the movement of the last few days was not only strong, but also rapid. But if traders carefully look at any cryptocurrency chart, they will see that even inside the current side channel, such movements have already been made. Thus, we still believe that bitcoin will not continue its growth and will perform a downward reversal around the $40,700 level. In the currency or cryptocurrency market, you can never be 100% sure of anything. In other words, it was not the comments of Musk or Wood that led to the growth of the bitcoin exchange rate. It was investors who bought coins, so the bitcoin exchange rate increased. Accordingly, no one can ever predict 100% at what time most investors and traders will buy and when they will sell. We can only assume. Theoretically, a new upward trend may even begin at this time, although bitcoin usually consolidates for a year or two after the end of the bullish trend. We want to say that everything is possible, any scenario, but we should focus on one. Therefore, as usual, only technical analysis can help here. And technical analysis says that there is now an important level of $40,700. Accordingly, the future prospects of bitcoin will depend on its overcoming or not overcoming.

Meanwhile, the International Monetary Fund said that bitcoin carries a danger for the economies of many countries, as it can displace their national currencies. According to Tobias Adrian, director of the IMF's marketing department, and Rhoda Weeks-Brown, general Counsel and director of the legal department, cryptocurrencies can become a popular means of payment in countries with high inflation and inaccessible banking services. In countries where bitcoin will have the status of a national means of payment, it will be impossible to fight money laundering and terrorist financing. Also, economists said that cryptocurrency mining is still very unecological. We, in turn, want to remind you that the fundamental background remains quite negative for bitcoin. The markets have already won back most of the negativity, and bitcoin can't get cheaper forever on the same news. Nevertheless, we do not see any serious reasons for the continuation of the growth of the quotes of bitcoin yet.



Technically, bitcoin has grown almost to the target level of $40,700 once again. Yesterday, there was a small pullback down. But, as we can see, it has already been completed. We still expect bitcoin to fall back to the level of $29,700 and try to overcome it again. Therefore, we believe that sales are more relevant now, at least until the $40,700 level is overcome.





Paolo Greco
Analytical expert
InstaForex Group © 2007-2021