Cryptocurrency Analysis

[IFX_Selena]

Technical Analysis of ETH/USD for September 27, 2021

Crypto Industry News:
The Indonesian government will not follow in the footsteps of China, which has banned all cryptocurrency transactions, emphasized the country's trade minister, Muhammad Luthfi, in comments to local media. The official added, however, that the government is considering how to make them less prone to being used in illegal financial activities.

Cryptocurrencies such as Bitcoin, Ethereum, and Dogecoin are currently considered assets and commodities in Indonesia. Their legal treatment allows Southeast Asian residents to trade digital coins, but their use as legal tender is not allowed.

This week, the Central Bank of China stated that cryptocurrency transactions are illegal, alluding to previously imposed restrictions. All related financial activities, including trading cryptocurrencies, selling tokens, and trading virtual currency derivatives are also prohibited.

Indonesian cryptocurrency trading has been booming for the past year and a half, according to reports. Transactions on 13 domestic exchanges authorized by the Futures Supervisory Board increased by 40% in the first five months of 2021.


Technical Market Outlook
The ETH/USD pair has tested the 50% Fibonacci retracement level again this weekend, but still the bears were unable to break higher. The level of $3,159 capped the bounce from $2,866 and the market reversed. The nearest technical support is seen at the level of $2,977 and $3,052. The momentum remains positive, but not that strong anymore, so bulls will have to gather more steam in order to move towards the next target seen at 61% Fibonacci retracement at $3,281.

Weekly Pivot Points:
WR3 - $4,157
WR2 - $3,675
WR1 - $3,440

Weekly Pivot - $3,036
WS1 - $2,728
WS2 - $2,316
WS3 - $2,003


Trading Outlook:
Ethereum have started the next wave up and violated the long-term target at the level of $3,550. The next long-term target for ETH is seen at the level of $4,394. Nevertheless, in order to continue the long-term up trend, the price can not close below the technical support at the level of $2,906. The level of $1,728 (61% Fibonacci retracement of the last big impulsive wave up) is still the key long-term technical support for bulls.







Sebastian Seliga
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Learn and analyze: what on-chain metrics and bitcoin technical analysis mean during consolidation phase

The previous week bitcoin was in limbo and was on the verge of breaking down a significant support zone at $40,000. However, eventually the price managed to bounce off to the safe positions and bitcoin started the consolidation process. Notably, fluctuations in the narrow range of $43,000-$45,000 are accompanied by significant changes in on-chain indicators and horizontal charts of the cryptocurrency. Therefore, during periods of price consolidation, it is crucial to monitor changes in key BTC metrics to determine a further price movement.

*Learn and analyze

Technical indicators are instrumental metrics that allow you to perform a technical analysis of financial instruments over a certain timeframe. An important tool in determining the current market trend and an individual asset, as well as allowing you to determine the direction, strength and important areas of cryptocurrencies (financial instruments).

On-chain activity - actions of cryptocurrency market players, who independently dispose of their crypto-assets, due to which the record goes directly to the main blockchain. This statistic includes both private investors and large companies.

Price consolidation is a period of time when a certain cryptocurrency is within a narrow horizontal price channel. This process usually indicates price stabilization or weakness of market participants (buyers and sellers).

According to the hourly chart, bitcoin is within the narrow horizontal range of $42,700-$44,200 and has been moving along it since the rebound from $40,000. With the coin's technical indicators pointing to a sideways movement it is also a sign of price stabilization or weak market players. The RSI and stochastic are moving around the 50 level, signaling a timid attempt to move up towards 60. On the one hand, it is a signal for growth. However, on the other hand, it indicates weak buyers, who are unable to provide the necessary momentum.



On the 4-hour chart, the situation is similar. The cryptocurrency price is moving in a horizontal channel and the bulls and bears are engaged in a tug-of-war, which only stabilizes the price due to the weakness of both. Moreover, the main cryptocurrency technical indicators continue to recover after the price has spiked to $44,000. The MACD indicator is moving in the red zone, but it will soon cross the zero mark, while the stochastic is close to forming a bullish cross. At the same time, RSI is moving along the 55 mark, which suggests price stabilization and sluggish investor activity.



The daily chart shows a bullish candlestick that bitcoin formed at yesterday's close. This is a bullish signal and may indicate a further upside movement and bitcoin may try to consolidate above $44,500. On the daily chart, the price consolidation trend is best seen: all three major cryptocurrency indicators are in a sideways movement. At the same time, no prerequisites for successful development of bullish signals on stochastics are visible, which also indicates a weak market.



However, to have a more definite picture of a further price movement and investor sentiment, we should turn to bitcoin's on-chain metrics. First of all, it is important to note an upward trend on Daily Active Addresses charts during the last week. However, activity has fallen significantly over the past few days, while the price has been rising. This means that a divergence between the number of unique addresses and the market value of bitcoin has formed. In order to judge the possible consequences of this divergence, it is necessary to continue to monitor its development. If the dynamics are not confirmed, it may be a sign of a local whale activity.



Much more attention should be turned to the MVRV on-chain metric, which displays the current investment position of market players. During the last week the indicator considerably decreased from 15% to 6%. It confirms the fact that many market players moved or sold BTC coins at a loss. At 11:30 am, the onchain metric had crossed the support line at 6.57%, but stopped declining. If the indicator continues its downward movement, overcoming the 3% boundary will be an important signal for the market about a possible change of trend and the beginning of a bearish cycle. However, putting aside pessimistic forecasts, we note that the indicator's current level suggests that part of market players sold their available coins. Taking it into account, it is likely that bitcoin's price consolidation period may continue until market players satisfy all demand. In order to track these dynamics, you should monitor the on-chain metrics of stablecoin supply and the volume of coins available from 10,000 BTC.



*Learn and analyze.

Daily Active Addresses - an onchain indicator that displays a number of unique addresses used by the bitcoin network during a certain period of time.

MVRV (Market Value to Realized Value) indicator - the indicator shows the ratio of market value to realized value of a particular cryptocurrency. This metric provides a more objective view of a coin's current value and market period. The metric also displays the results of moving coins: if the value is below 0, then players moved coins at a loss, and if it is above 0, then investors made a profit from transactions with coins.






Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin bulls continue to respect key support over the weekend.

Price has made no real progress over the weekend. Bitcoin price continues to move sideways between $40,000 and $45,000. Support at $39,500 is key and bulls do not want to see price break below this level. If this happens we get another sell signal.



Blue line- resistance

Green lines- Fibonacci retracements

Bitcoin has so far retraced 61.8% of the last leg down from $49,000 to $39,500 area. Price is below the blue downward sloping resistance trend line and as long as this is the case, price will remain vulnerable to more downside. Bulls need to break above $45,500 to get the first sign of strength. However the important bullish signal will come if and when price recaptures $50,000. If until then price breaks below $39,500, traders should be cautious as Bitcoin will be vulnerable to a move towards $35,500 and $30,000.






Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading plan for Bitcoin for September 27, 2021



Technical outlook:

Bitcoin has been drifting sideways since printing a low around $40,000 mark. The crypto might drop one last time toward $37,000-38,000 mark before finding support and resuming higher. Having said that, a push above $45,500 from here will confirm a bottom is in place around $40,000 and Bitcoin is heading towards $48,000-49,000 and higher in the near term.

Bitcoin has completed a corrective drop between $53,000 and $40,000 as seen on the chart. Although fibonacci 0.618 extensions are pointing towards $37,500 levels before resuming its rally, it is not mandatory. Traders might prepare to build long positions and look to add more if prices decline toward $37,500 mark.

Bitcoin is facing immediate interim support around $40,000, while resistance is seen close to $48,500-49,000 levels respectively. A push through $48,500 will be constructive for bulls and open doors toward $65,000 going forward.


Trading plan:
Potential rally toward $65,000, against $35,000.

Good luck!





Oscar Ton
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading plan for Ethereum for September 27, 2021



Technical outlook:
Ethereum has been drifting in a range since dropping to $2,650 lows over the last week. The crypto remains in buy zone of the trend line support keeping overall bullish structure intact for now. Bulls are looking poised to push toward $450 and $4,300 levels in the next few trading sessions before finding resistance and turning lower.

Etherum has dropped between $4,000 and $2,650 in a corrective manner (3 waves). The crypto had found support at $2,650, just aead of fibonacci 0.382 extension as highlighted on the chart here. Probability remains for yet another drop toward $2,600 and $2,400 levels before turning higher again, though not mandatory.

The crypto is facing immediate resistance at $3,675, while interim support is seen around $2,650 level respectively. A break above $3675 from here would be further encouraging to bulls and open doors towards all-time highs. Traders might want to position accordingly.


Trading plan:
Potential rally to $4,300 against $2,500.

Good luck!





Oscar Ton
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

China expands tough measures against cryptocurrencies



Cryptocurrencies plummeted again after China expanded its crackdown on digital currencies. The People's Bank of China said all cryptocurrency-related transactions are now illegal in the country.

The move also pushed the stock value of crypto companies down, for example, Argo fell by 10%, Northern Data lost 2.5%, Coinbase Global and Robinhood Markets dropped 3.5%, MicroStrategy slipped 6.7% and Marathon Digital slumped by 8.1%.

Accordingly, Bitcoin traded under $ 41,000, while Ethereum plunged 8.9% to $ 2,864.



Markets were clearly pressured by China's tighter grip on sectors ranging from private education to digital gaming. The debt crisis at Evergrande made the situation worse.

Xiadong Bao, fund manager at Edmond de Rothschild, said the government is channeling available liquidity into the real economy. Its overall goal is to lessen speculation in property and crypto, as well as more sustainable development.

In any case, the decision hammered many tokens, including EOS, Litecoin, and Dash. Adam Crisafulli from Vital Knowledge said it is now unideal to invest on Bitcoin because China's attitude towards cryptocurrencies is likely to be accepted by other countries.





Andrey Shevchenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

BTC analysis for September 27,.2021 - Downside rotation in play towards $41.000

Technical analysis:



BTC has been trading downside in last 12 hours and I see potential for further downside rotation.


Trading recommendation:
Due to strong downside trend in the background and no signs for the reversal, I see potential for the downside continuation and test of $41,000 and $40,000.

Watch for selling opportunities on the rallies with the downside targets at $41,000 and $40,000.

Stochastic is showing overbought condition and potential for the bear cross.

Resistance is set at $45,200




Petar Jacimovic
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical analysis for Bitcoin

Bitcoin



The bulls were able to stop a major decline at the close of the previous week by forming a long lower shadow on the weekly candlestick. Due to this, we have seen consolidation in the accumulation area of various levels and continuous uncertainty in the last few days. The center of gravity can now be designated at 43883 - 42753 (daily Tenkan + weekly Fibo Kijun). Currently, the resistances that hinder the development of the upward movement can be noted at the borders of 45033 (weekly short-term trend) and 46180 - 46960 (daily levels + weekly Kijun + monthly Tenkan).

Now, the bears have to break through the levels of 41513 - 41537 (monthly Fibo Kijun + weekly Senkou Span A) to regain their advantages and opportunities, and then leave the daily cloud and update last week's minimum extremum (39491).



Bitcoin has moved above key levels in the smaller timeframes, which are joining forces around 42658 - 43134 (weekly long-term trend + central pivot level). This arrangement favors the bullish mood to develop. The upward pivot points are the resistances of the classic pivot levels at 44611 - 45661 - 47614. It is worth noting that the breakdown of the key support levels (42658 - 43134) and consolidation below will change the current balance of power on the hourly chart, which will favor the bears. In this case, we can consider the support of the classic pivot levels set at 41607 - 39655 - 38604 to be the downward pivot points.

Ichimoku Kinko Hyo (9.26.52) and Kijun-sen levels in the higher time frames, as well as classic Pivot Points and Moving Average (120) on the H1 chart, are used in the technical analysis of this cryptocurrency.





Evangelos Poulakis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Cardano announces stablecoin issuing and begins DeFi sector developing

After a significant drop in mid-September and a rather unsuccessful Alonzo update, ADA managed to prevent the fall near the $2 level. The cryptocurrency continued to swing in the narrow range and was accumulating for the past few weeks. However, Cardano developers are working on the issues and have already begun the gradual launch of smart contracts in the mainnet. In addition, in the near future, there will be a significant development of the Cardano ecosystem, which may have a positive impact on the quotation of its coin.

The most notable news regarding the ADA/USD pair was the announcement of the first algorithmic stablecoins launch in the mainnet. The coin is called Djed and will be provided with the support of smart contracts. The algorithms will use the basic coins for transactions. It is needed for the new Cardano token to swing around $1. The ability to pay commissions in the ADA network is called the main feature of stablecoin. In addition, new algorithms were created for potential use in DeFi projects. Also, the introduction of its coin will help optimize the blockchain and the Cardano ecosystem as a whole. This is a very important feature, given that the project announced a collaboration with Dish Network. The cooperation is aimed at the integration of blockchain into the company's business processes.

The second important announcement was Cardano's $100 million investment in the development of DeFi projects based on ADA. It will significantly increase the number and efficiency of decentralized finance projects, which will influence the development of the entire Cardano ecosystem. In addition, Chainlink is cooperating with the project and is helping to create smart contracts for the DeFi applications. In the short term, these announcements will not bring much growth to the cryptocurrency, but it could potentially be perceived as an intention to compete with ETH and SOL in the DeFi and NFT spheres. The development of the ecosystem will directly affect the price of the cryptocurrency, but this process will take some time, as optimizing processes and implementing new algorithms require a lot of resources.

There is no doubt that the cryptocurrency will continue to expand and grow in volume as news tells about the Cardano ecosystem's bright future. Today is seen as a profitable entry point into the ADA market. Over the past 24 hours, the ADA/USD pair gained 1% and is quoted at $2.25 as of 3 p.m. At the same time, daily trading volumes remain low, around $3 billion with a market capitalization of $72 billion. Technical indicators show the cryptocurrency is consolidating, as demonstrated by mirror indicators of the price after the formation of a bullish engulfing candlestick on September 22. On the daily chart, technical indicators signal a sideways trend due to price stabilization. Stochastic oscillator and RSI are moving along the 40, and MACD has moved out of the red zone and continues sideways under the zero level.



The situation is similar on the 4-hour chart, though stochastic started declining above the 40 mark, while the RSI managed to stabilize. Considering ADA's unsuccessful attempt to break through the resistance located at $2.4, the market is gradually accumulating the necessary volumes and the coin will test that level later. While the coin continues to swing in the range of $2.14-$2.25, this period may be considered as an entry point or a possibility to buy more coins with the chances of a further uptrend. Cardano's ADA will most likely start using the potential of the Alonzo update already in October, which may attract new users. This may allow implementing a bullish momentum that is beginning to form now.








Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin could drop to $30k by the end of the year; how likely is it?

Bitcoin successfully bounced off $40k early last week and has since firmly settled in the $43k - $45k corridor. At the same time, the coin is in the stage of consolidation without claims to exit the current range of fluctuations. It is also worth noting the shaken confidence of long-term cryptocurrency holders, who staged a local sale of the coin in mid-September. The behavior of medium-term holders is also not encouraging, as the number of BTCs that has not moved in three months has reached a low since mid-2015. PlanB, who predicted a possible drop of bitcoin to $30k at the end of this year, also added fuel to the fire.

Crypto analyst PlanB has identified a scenario in which Bitcoin will fall to $30k at the end of 2021, according to the S2F price movement modeling algorithms. The speculation was made by the creator of the Stock to Flow model of bitcoin, who stated that if the price movement continues according to the time model, the coin will cost $30k. At the same time, the S2F model still expects to see the price of bitcoin in the $100k region. The Stock to Flow model is based on calculating the ratio of market supply and annual growth of a cryptocurrency. In other words, the main idea of this model is that the more scarce an asset is, the more valuable it is.



Despite some chaos from this statement, multiplied by the nervousness of the market, the issue of falling to $30k is being seriously discussed. Such a scenario should not be completely ruled out, but this is unlikely given the growing inflation, maintaining the current rate and other positive theses voiced at the Fed meeting. In addition, we should not discount the growing institutionalization of bitcoin and its gradual introduction into all spheres of life of ordinary people. Whales continue to accumulate BTC volumes, and the currency hash rate is setting new local highs. In October, an important Taproot update will start, which will also become an important lever in the investment attractiveness of the coin. The main fundamental and medium-term factors are entirely on the side of bitcoin, and therefore there is every reason to count on the growth of the asset by the end of the year.

If we consider a more local perspective, then everything looks more gloomy due to the next portion of the bans by the Chinese authorities. Due to the complete ban on cryptocurrency transactions in China and the persecution of Korean crypto exchanges, massive movements of bitcoins will begin, which will create a heavy load on the network of currency and platforms. This can be fraught with problems in the operation of the main network, as well as possible fluctuations in the value of bitcoin, which can provoke a sale. Right now, the cryptocurrency has recovered from falling to $40k and is in the stage of price consolidation. We should not expect sharp or systematic periods of growth in the near future since the main task of the coin is to stabilize the price. In the third quarter, this cycle should end and provoke active market growth in the final quarter of 2021. The most acceptable strategy for most players now is the accumulation of coins that consolidate at local lows.

Meanwhile, bitcoin continues to fluctuate within the local corridor of $43k - $44.5k, and over the past day, the price has increased by 5%. At the same time, trading volumes remain at an average level, and the asset itself is quoted at $43.5k. Bulls and bears arrange local battles, but it is impossible to significantly influence the price even against the backdrop of negative news from China and nervousness associated with Korean crypto exchanges. This indicates a stabilization of the price, and therefore soon we will start active accumulation of BTC.

On the four-hour chart, the coin looks weak, there are prerequisites for movement towards the lower border of the current fluctuation range. The RSI indicator started a downward movement, which indicates the strengthening of sellers' positions, and the stochastic formed a bullish crossover, but began to decline. A bearish divergence is potentially forming on MACD, but, most likely, the metric will also begin to decline after leaving the red zone.



On the daily chart, the situation has leveled off and bitcoin is confidently moving flat. The RSI and stochastic indicators are moving along the 50 mark, and the MACD forms the prerequisites for an upward movement, which is also fraught with divergence. Given the current performance of technical indicators, bitcoin will continue to move sideways with attempts to exit the current range of fluctuations. Taking into account the news background and the constant movements of coins due to problems in South Korea, breakout attempts are likely to be bearish, and therefore the probability of another retest of $40k increases.







Artem Petrenko
Analytical expert of InstaForex
© 2007-2021