Cryptocurrency Analysis

[IFX_Selena]

Trading signal for Ethereum, ETH, for September 10 - 13, 2021: Sell below 3,750 (SMA 21)



On September 3, the price of Ethereum reached the maximum of 4,024 and psychological level after consolidating for four days. On September 7, it made a sharp fall below this level, leaving an engulfing candle that covered the price of 29-day period daily high and low in the movement of Ethereum.

This bearish engulfing candle with more than 930 pips falling is a sign of a trend change or a correction that could last for a long time. The 4,000 level is seen as the top and the 1,500 level as the bottom.

According to the daily chart, the last candles show a consolidation in Ethereum. ETH is positioning below the SMA 21, leaving wicks which indicate that the bearish force is prevailing and buyers are decreasing. Every time the price hits new highs, the sellers enter from aggressively weakening ETH.

The psychological level of 3,000 has turned out to be the next support for Ethereum. This level coincides with the 6/8 murray line located at 3.125. A technical bounce at this level could be the key to restart the uptrend. In such a case, ETH is likely to rise to 4,024, and if the bullish move continues to rise, it could even retest the all-time high at 4,372.

The 200 EMA located at 3,334 on the 4-hour chart is now acting as dynamic support for Ethereum. As can be seen on the chart, the long tail on the day's candle shows that the bulls are willing to buy around 3,000. Therefore, this level will be a good opportunity to buy ETH.

The technical reading of the eagle indicator that measures the volume and strength of the market is showing a bearish signal. This means that in the coming days it could fall to the 6/8 support of murray. If the selling pressure intensifies below this level, it could fall to key 4/8 support around 2,500 and 200 EMA.


Support and Resistance Levels for September 10 - 13, 2021
Resistance (3) 3,708
Resistance (2) 3,636
Resistance (1) 3,530

Support (1) 3,352
Support (2) 3,280
Support (3) 3,175


Trading tip for ETH/USD for September 10 - 13, 2021
Sell if there is a pullback at 3,750 or sell below 3,500 (SMA 21), with take profit at 3,125 and 2,500 (EMA 200), stop loss above 3,900.






Dimitrios Zappas
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Senator Elizabeth Warren believes that cryptocurrencies are a shadow bank and urges Janet Yellen to tighten regulation of cryptocurrencies: Gary Gensler is also closely watching the crypto market



Senator Elizabeth Warren believes that crypto technologies are a kind of shadow bank, that is, investors and depositors can also use financial services, as in federal banks, but, unlike the traditional method, when money is taken from banks, investors will not be protected here and their money can turn into dust.

Warren believes that shadow banking is an activity that takes place outside the traditional banking sector, and banking bypasses all areas of regulatory supervision. Senator Warren also went very hard on the storage of crypts, so that banks in the United States would be prohibited from storing personal deposits to support stablecoins.

This method can be a catalyst for the end of the growing crypto market. Warren is known as an anti-crypto revolutionary who opposes digital tokens, as they pose a threat to the dollar.

She also called on Treasury Secretary Janet Yellen to tighten the rules for related industries. According to her, investors, especially those who do not yet have experience in the crypto market, can suffer huge losses in unstable and unregulated markets, such as the crypto market.

Warren wrote a letter to Treasury Secretary Janet Yellen, touching on the problems that exist in the cryptocurrency market.The chairman of the Securities and Exchange Commission, Gary Gensler, believes that cryptocurrencies can coexist with fiat funds, but a clear and verified regulation of this industry is necessary.

According to Gensler, cryptocurrencies can become mainstream and even reserve federal currencies only when regulators keep the cryptocurrency market in their tight grip.

However, Gensler is neutral about the cryptocurrency market and is intrigued by the innovations that cryptocurrencies and their networks provide. However, he is sure that the cryptocurrency market will not survive without the regulation of this financial segment.





Vitaly Kolesnikov
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Correction may continue. Where to catch the main cryptocurrency?

Bitcoin behaves in a very strange way relative to the support level of the side channel 46,299.48 - 50,513.53. The daily candle closed slightly below it on Wednesday. And on Thursday, it is still forming something like a doji with a body below the level. It is too early and wrong to draw conclusions on an unclosed candle. But there is uncertainty.

Locally, the direction of BTC/USD is unclear, but the medium-term bullish trend is clearly not lost. The only question is whether the correction will last and how deep. The answer to the question about the continuation of the decline will remain unanswered until we see the price determination relative to the level of 46,299.48. But if it is confirmed as resistance, we can expect a movement downward.

The following levels remain the targets for the fall of BTC/USD. First, you should think about the red dotted support at 44,807.24, below which the price did not fall, moving into a wide range of 41,980.24 - 64,883.36. But if this level is broken, the price will drop even lower to the strong mirror level of 41,980.24, which, in my opinion, separates the (conditionally) bullish and bearish ranges for bitcoin.

Meanwhile, Glassnode data show that a 15% drop in Bitcoin on Tuesday led to an increase in unrealized losses among holders of the main cryptocurrency. Such conclusions are made based on the Percent Supply in Profit Indicator, which allows traders to use that part of the coins existing on the market that are profitable. The price of a coin is determined by the time it was last moved.

Indicators such as the percent supply in profit help determine the current mood in the market, showing the gains and losses of currency holders.

At the moment, more than 10% of bitcoins owned by traders and investors have entered the "unrealized losses" zone. This means that if the holders were selling their coins at this very moment, they would face losses since their average market entry was in the range between $52,000 and $45,800.

During the previous market correction in July, when bitcoin plummeted to $29,000, more than 20% of the total supply turned into significant losses. The offer is still mostly profitable, with about 90% of holders making money in current market conditions. The bitcoin market will only become unprofitable if its price falls below $10,000.

The largest volume of active market entry occurred in 2021 when institutional investors began to buy bitcoin. In January 2021, almost $20 billion worth of bitcoins were purchased for several weeks in a row.







Ekaterina Kiseleva
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Mike Novogratz's ingenious explanation for the fall of bitcoin



The last few days have been marked by a $10,000 drop in the main cryptocurrency. This event is directly related to the events in El Salvador, where the country's government decided to legalize bitcoin as a means of payment to combat the inflation of the national currency and save on cross-border transfers. However, masses in El Salvador immediately responded with a series of protests and rallies against this bitcoin imposition. Experts stressed that bitcoin is a failed experiment for El Salvador. Locals are already on the edge of poverty and do not want their salaries, pensions, and social benefits to depend on ultra volatile cryptocurrency.

However, the events in El Salvador could just be an impetus for bitcoin. The fact is that we have repeatedly questioned the validity of the last round of cryptocurrency growth. After the formation of an upward trend was completed by all signs, bitcoin suddenly increased by $20,000. There were no clear reasons and grounds for this, so we considered that this growth was completely illogical. It is likely that other market participants also counted. Therefore, El Salvador became only a formal reason to start selling bitcoin.

Meanwhile, Galaxy Digital CEO Mike Novogratz gave an "ingenious" explanation of why bitcoin fell. According to Novogratz, the cryptocurrency was heavily overbought after 2 months of growth and many market participants expected a correction. In principle, any movement of any asset in any market can be explained in this way. Also, some experts say that the fall of bitcoin was provoked by the sales of large miners, who, according to Glassnode, got rid of almost 3,000 coins last week. Also among the possible reasons is the beginning of an investigation by the U.S. Securities and Exchange Commission against several cryptocurrency exchanges and the restrictions imposed by some regulators on the activities against the Binance exchange.

All this, simply put, can be called a tightening of regulation of the cryptocurrency market and its participants. However, even if all these reasons are added together, it is still unclear why bitcoin has sunk so much. More precisely, even all these reasons combined do not pull on a drop of $10,000. Thus, from our point of view, the "chain reaction" is to blame because of the unreasonableness of the growth of bitcoin. The cryptocurrency again rose significantly from scratch, and when one of the major market participants sold a significant number of coins, the rest also rushed to do it, which brought down the exchange rate, which had been quite stable for two months and was not even too volatile.



The daily timeframe shows a drop of $10,000 in one day. The fall ended exactly near the line that used to be the border of the lateral expanding channel. One way or another, the further decline has been stopped for now and a possible entry into a new round of the downward movement should be monitored on the 4-hour timeframe.





Paolo Greco
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

BTC analysis for September 09,.2021 - Watch for the breakout to confirm further direction

Technical analysis:



Sideways market at the price of $46,200 with potential for the breakout play.


Trading recommendation:
If you see the breakout of the $45,700, watch for selling opportunities with the downside target at $43,600

Key resistance pivot is set at $47,470





Petar Jacimovic
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin stabilizes decline around $46,000.

After reaching new short-term highs close to $53,000, Bitcoin reversed as expected and reached close to $42,000. Price has touched the 38% Fibonacci retracement support. Price has bounced towards $46,000 but I believe it is more probable to see another move lower below $43,000 than a new higher high above $53,000.



Red line - expected path

Green lines- Fibonacci retracements

Bitcoin has most probably completed the entire upward move from $29,000. This is the time to at least make a corrective pull back. The corrective pull back has started and the first leg down is most probably complete. I expect a shallow bounce and then another move lower towards the 50%-61.8% retracement area. Price remains vulnerable to more downside and I expect to see this move lower unfold until the end of next week. Then we will know more about the medium-term trend potential of Bitcoin.






Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Robinhood launches service to reduce volatility of cryptocurrencies: why it is important

Two days ago, traders lost more than $4 billion due to a sharp market crash triggered by numerous factors. Quotes of many coins dropped 10%-15% in a few hours, giving no opportunity to minimize losses or get away with it. Before the local crisis in late June, retail audiences turned away from the market owing to excessive volatility of cryptocurrencies. In addition to lack of regulation, volatility is the key problem of the cryptocurrency market. Accordingly, the fact that online broker Robinhood has launched a function to reduce risks from price spikes is crucial.

This function was introduced for long-term investors, who are the first to incur losses due to the volatility of coins. Its principle is to automate the purchase of a certain amount of cryptocurrencies with a set periodicity (daily, weekly, monthly). Users set the interval of purchases on their own. Consistent and regular investments become a habit, making assets grow over time and become less susceptible to value fluctuations. In addition, the online broker is dealing with an algorithm for cancelling orders if volatility increases.

The direct benefit of implementing this function is obvious - rise in income, as well as in the medium and long-term audiences of the cryptocurrency market. Reduced risk level leads to greater interest in financial instruments and, accordingly, growth and development of the entire industry. A similar function is provided by ETFs. They minimize risks in operations with cryptocurrency. More than 30 applications to launch ETFs in the US are currently pending with the SEC. Experts at Bloomberg and other major companies are confident that the first such institution in the US will launch as early as 21. Its obvious benefit will be a significant increase in the institutional audience, allowing the market to reach a new level of capitalization. First of all, this will apply to the market leaders - BTC and ETH. They continue to expand the presence of large companies.




However, amid the announcement of a new function from Robinhood, it marks the beginning of a new period that makes cryptocurrency transactions less risky. On the one hand, it makes the cryptocurrency market less volatile and provides perspectives on a wider audience. At the current stage, it will reduce the number of speculators and remove additional pressure on quotations while hitting new highs or holding support lines during a correction. At the same time, the spread of similar algorithms will mean the isolation of the largest coins in capitalization by increasing the number of institutional audiences. The percentage of large companies in BTC and ETH has reached an all-time high in the last three months, indicating the possibility of market manipulation and squeezing out the retail audience. This is evidenced by an analysis of bitcoin and ether metrics, according to which institutionalization has increased significantly over the past two years. Due to the introduction of new safe ways of cryptocurrency investing, the share of whales will grow and their influence on the market will become decisive.




The launch of Robinhood's new system promises many positives for the market in terms of leveling out the high volatility of cryptocurrencies. Besides, it will also significantly accelerate the process of institutionalization and the gradual monopoly of large companies in a certain list of assets. Moreover, with the growing income from digital coins operations, the process of taxation and state regulation of the cryptocurrency market will accelerate.





Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin slips to $ 46,000



Bitcoin stabilized at $ 46,400 after falling by more than 9%, which is one of its worst sell-offs since May.



It happened when El Salvador adopted the token as its official currency, becoming the first country to make Bitcoin (BTC) legal tender. Such was supposed to be a milestone for the crypto industry because it represents financial legitimacy, but it went wrong and was met with protest as the citizens fear that they will be forced to accept an extremely volatile currency.

Early signs have shown that people are not willing to exchange their dollars for bitcoins and on Tuesday, more than 1,000 people protested in San Salvador. One of their captions say Bitcoin will bring more corruption and poverty.

Part of the concern stems from the fact that bitcoin is not a stable currency, but a few other government-backed fiat currencies also lose 9% in 24 hours. Those who do this are in war-torn or poorly governed countries, many of which are "dollarized" like El Salvador.

As such, some crypto proponents see the adoption of Bitcoin by El Salvador as a turning point. Bitwise CIO Matt Hougan even said that before, there were no countries that thought of Bitcoin as legal tender. But now there is one and it seems that other points have not changed at all. Hougan added that the token is still in its "infancy" to become one of the main currencies, but looking over the past five years, this event can be considered as a turning point.

However, there is an immediate concern for investors, which is the leverage built into Bitcoin and other cryptocurrencies. Traders who buy bitcoin futures or use small amounts of collateral to get large bets may be forced to sell their positions or be automatically liquidated by exchanges as the price falls.

Bybt exchange reported that long positions worth $ 3.7 billion have been liquidated in the market over the past 24 hours, including $ 1.3 billion in Bitcoin and $ 928 million in Ethereum. This accounts to more than 150,000 traders.

Nevertheless, demand for bitcoin futures has been growing for several months, reaching nearly $ 20 billion in early September. It's still below the $ 28 billion peak in April 2021, but that's enough to trigger a cascading price movement.

None of this stops some bulls from predicting higher bitcoin prices. For example, analysts at Standard Chartered released a forecast on Tuesday, saying that its price will hit $ 100,000 in late 2021 or early 2022. Bank analysts also structurally value bitcoin around $ 50,000 - $ 175,000.

"As a medium of exchange, bitcoin may become the dominant peer-to-peer payment method for the global unbanked in a future cashless world," they said. In estimate, Bitcoin could value $ 120,000 in 2040, based on the slowdown in its supply compared to the growth of the M2 US dollar money supply. If institutional portfolio managers allocate only 2% of global portfolios to cryptocurrency, demand could push prices up to $ 175,000.

But of course, Bitcoin and other cryptocurrencies have no intrinsic value, so valuation models are uncertain. Analysts can only guess what the next move of cryptocurrencies will take. For the people of El Salvador, they can only hope that it will not fall again.





Andrey Shevchenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

TECHNICAL ANALYSIS OF BTC/USD FOR SEPTEMBER 9, 2021

Crypto Industry News:
Following El Salvador's historic adoption of Bitcoin as legal tender, Cardano founder Charles Hoskinson predicts that many more countries will follow in the footsteps of the Latin American nation.

El Salvador's acceptance of Bitcoin further justifies the belief that people should be in control of their money, Hoskinson said in his YouTube video "Congratulations Bitcoin."

The founder of Cardano expressed his belief that cryptocurrencies are the future of money as the younger generation will inevitably result in massive cryptocurrency adoption.

"Most people under the age of 25 are positive about cryptocurrencies, and many are. This is the future. Their children will grow up with these values and beliefs about the nature of money" - he said.

Hoskinson also predicted that more countries around the world would accept cryptocurrencies as part of various government structures:

"In the coming years, many more nation states will use cryptocurrencies as part of their monetary policy, either as reserves with their central banks, or as a cryptocurrency bus for central bank settlements, or potentially simply adopting cryptocurrency - as El Salvador has done - and making it a currency domestic"- he added.


Technical Market Outlook
The BTC/USD pair has bounced towards the level of $47,557 and is developing a triangle pattern. The bears are in full control of the market as the price might be heading towards the level of $45,043, the last technical support before $43,159 level. The weak and negative momentum supports the short-term bearish outlook.

Weekly Pivot Points:
WR3 - $59,047
WR2 - $55,505
WR1 - $54,221

Weekly Pivot - $49,999
WS1 - $48,690
WS2 - $44,656
WS3 - $43,452


Trading Outlook:
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 $70,000. The next mid-term target is seen at the level of $59,506. This scenario is valid as long as the level of $30,000 is clearly broken on the daily time frame chart (daily candle close below $30k).






Sebastian Seliga
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

TECHNICAL ANALYSIS OF ETH/USD FOR SEPTEMBER 9, 2021

Crypto Industry News:
In an interview with local media, Javier Argueta, attorney-at-law of the Presidential House of El Salvador, explained the obligations of companies on the day before the entry into force of the law recognizing Bitcoin as legal tender.

The legal counsel of the President of El Salvador has stated that companies are required to accept Bitcoin from customers - but they can choose whether to receive BTC or US dollars after the transaction is settled.

According to a rough translation, Argueta stressed that companies must "have an electronic wallet" to receive Bitcoin, however "in a transaction [...] you have the will to receive Bitcoin or dollars, therefore it is voluntary."

The official added that companies that refuse to accept BTC will act in violation of local laws. ElSalvador.com tweet states:

"According to Argueta, all companies are required to make a transaction in Bitcoin, and despite the fact that neither the law nor regulations clearly specify it, if the company does not accept it, it is at risk of violating the Consumer Protection Act," we read.

The government Chivo wallet allows users to process transfers in both BTC and US dollars. The wallet is maintained in partnership with the Mexican crypto exchange Bitso, which works with the cryptocurrency-friendly California-based bank Silvergate to facilitate USD-denominated transactions.


Technical Market Outlook
The ETH/USD pair has bounced from the level of $3,026 to the level of $3,552. Currently, the price is hovering around this level, but the momentum is negative and weak, so another wave down should be expected. Please notice, that the long-term trend line support around the level of $3,150 was violated as well, which is not a good sign for the nearest future. The local technical support levels are: $3,337, $3,274, $3,185 and $3,122. The resistance is seen at $3,596 and $3,830. The key technical support is still located at the level of $2,945.

Weekly Pivot Points:
WR3 - $5,271
WR2 - $4,663
WR1 - $4,404

Weekly Pivot - $3,750
WS1 - $3,518
WS2 - $2,851
WS3 - $2,607


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 break below the technical support at the level of $2,695. 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