Cryptocurrency Analysis

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Long-term investors aim for a two or three-fold growth of bitcoin



The last round of bitcoin's growth looks vastly strange. The cryptocurrency has grown by almost $21,000 in total, despite the fact that there were no good reasons and fundamental factors for this. Moreover, most traders and experts expected a further drop in quotes when the price was not far from the level of $30,000. But for no reason, bitcoin turned up and has been growing for more than a month. From our point of view, there is a classic situation that is typical only for bitcoin. At a certain point in time, market participants began to buy cryptocurrency again, not believing that it is capable of continuing to fall below $30,000 per coin. That is, without collusion and without having any common grounds, the markets began to buy this cryptocurrency. And when the growth had already picked up pace, it was joined by other participants who believe that a new bullish trend was being formed at this time. Thus, by and large, the current growth of bitcoin by $21,000 is just random. However, it must be noted that any fundamental theory must be confirmed by specific technical factors. That is, we, for example, expect a new drop in the bitcoin exchange rate to the level of $29,700, since we believe that the bullish trend is over, and at this time the markets are buying bitcoin simply ahead of the curve, because they are afraid that new legislation will be adopted in the States, which will greatly complicate the circulation of bitcoin and increase tax pressure on almost every transaction. Moreover, in the coming months, the Fed may announce the curtailment of the quantitative stimulus program, which will mean a gradual cessation of inflating the money supply. Accordingly, the inflow of new money to the markets will decrease. These factors, from our point of view, indicate that the growth of bitcoin is not long and random. However, as long as the price is located above the ascending trend line, it makes no sense to sell the cryptocurrency. On the contrary, it should be bought, according to the formed trend. So, it turns out in the end that the foundation speaks in favor of the fact that bitcoin should fall, but at the same time, from a technical point of view, an upward trend remains.



Technically, bitcoin continues to be in an upward movement on the 4-hour timeframe and has overcome the level of $47,500, which is the minimum of April 26, as well as 50% of the movement from the absolute maximum of the value to the minimum of 2021. Thus, the next target for the growth of the first cryptocurrency in the world is the level of $51,350. It is advisable to sell bitcoin as soon as the price is fixed below the ascending trend line.





Paolo Greco,
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin: Forecast worked out quickly and clearly. Where to go next?

As you can see, we were not mistaken with the sideways 44,807.24 - 48,178.13 for bitcoin, located between two red dotted lines. Its support persisted and closed yesterday with a sharp price increase, today reaching the upper limit of the corridor.

Meanwhile, the expiration date of bitcoin options is approaching. There are now 3,700 ultra-bullish call options contracts above $ 50,000.

The adjusted open interest volume for neutral and bullish call options now stands at $190 million. After the expiration of contracts for $48,000, the volume will be reduced to $138 million.

The 73% of total protective put options are below the $44,000 level. However, upon expiration above this mark, the volume of open interest in bitcoin options will decrease to $65 million.

If expiration takes place at $46,000, open interest can grow to $105 million. This is a good enough reason for buyers to push the price up so sharply today.

Meanwhile, Glassnode notes that bitcoin outflow dominates now: investors are withdrawing coins. Over the past year, the market has gone through several phases of currency flow dominance, with the last outflow dominance seen at the end of 2020.

What to expect after today's growth? Two scenarios are technically possible here. The first is a sideways reversal 44,807.24 - 48,178.13 downward, if the two-day growth was really dictated by the expiration of options. It is worth watching the level of 48,178.13, as it is a strong mirror horizontal.

The second scenario is a breakdown of the level of 48,178.13 and consolidation above. If confirmed as resistance, the main cryptocurrency could continue to rally towards the psychological mark of $50,000 per coin and the technical area near $52,000.

And finally, some good news. Wells Fargo bank is in the top of the headlines today, which has registered a private bitcoin fund to provide crypto services to rich clients.

The giant's partners will be FS Investments and New York Digital Investment Group (NYDIG).

Perhaps this news, in addition to the expiration of options, became one of the bullish factors in the rapid and rather technical growth of the main cryptocurrency.

Earlier this year, a report was released titled "The investment rationale for cryptocurrencies". At the time, the bank's investment arm announced that the new fund would be available to "qualified investors." The document stated:

"WFII believes that cryptocurrencies have gained stability and viability as assets, but the risks lead us to favor investment exposure only for qualified investors, and even then through professionally managed funds."

Interest in cryptocurrency among banks is growing, indicating that bitcoin and other large digital assets are more and more firmly rooted in the minds of institutions as assets in which it is possible and even worth investing.







Ekaterina Kiseleva
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading Signal for LITECOIN - LTC/USD for August 20 - 23, 2021: Key level $192.63 (EMA 200)



The daily chart of Litecoin shows that it has approached the EMA of 200. The first attempt to break thought this level was on August 18. This is where it started a technical correction. Now it is likely that Litecoin will try to break through this level for the second time and thus be able to reach the psychological level of 200.00.

Litecoin fell below the 200 EMA on May 19 and since then it has been consolidating between an upper range of 188 to a low of the range at 102. Now it is approaching the top of this level. The breakout of the 200 EMA could give it more bullish strength to hit the target at 200.00 and thus rise to the 61.8% Fibonacci level at 291.00.

As Litecoin remains below the 200 EMA located at 192.62, we believe that in the medium term it could continue with a bearish bias and fall towards the low of 102.00.

The last daily candlesticks show an intact uptrend projected with a trend channel. A breakout and consolidation below this channel could be the start of a new bearish wave up to the 150.00 level, 4/8 murray line and a pivot point.

The key is to wait until Litecoin pulls back to the level of 192.63 (EMA 200), or wait for a sharp breakout of the uptrend channel with the targets at 160.00 and 150.00 in the short term.


Support and Resistance Levels for August 20 - 23, 2021
Resistance (3) 197.75
Resistance (2) 192.70
Resistance (1) 183.81

Support (1) 178.49
Support (2) 175.31
Support (3) 169.60




Dimitrios Zappas
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for August 20, 2021

Crypto Industry News:
According to Shanghai Securities News, the Shenzhen branch of the People's Bank of China closed 11 entities operating cryptocurrency exchanges and enabling cross-border stock trading services.

The report quoted PBOC whose representatives said they had "cleared" the market of cryptocurrency exchanges that are believed to be operating illegally in the country. Stock exchanges allegedly violated currency exchange rules and operated cryptocurrency-based services despite a nationwide ban.

A similar incident happened in July. The Chinese central bank then ordered the termination of the Beijing software vendor Beijing Qudao Cultural Development Co Ltd for providing cryptocurrency trading services.

It is worth recalling that cryptocurrency exchanges cannot operate in China, and financial and payment companies have been prohibited from providing services that have anything to do with them. The authorities, however, do not prohibit private individuals from owning cryptocurrencies.

While the PBOC did not disclose the names of the affected companies, it is speculated that one of the targets was a "well-known national finance website".


Technical Market Outlook:
The ETH/USD pair has bounced from the technical support located at $2,977 and is testing the lower channel line from the downside. If there is a breakout above the channel line, then the bulls are back inside the main ascending channel, so the corrective pull-back is done. The next target for bulls is seen at the levels of $3,274 and $3,337. The strong and positive momentum supports the short-term bullish outlook for ETH.

Weekly Pivot Points:
WR3 - $3,888
WR2 - $3,615
WR1 - $3,448

Weekly Pivot - $3,162
WS1 - $3,024
WS2 - $2,746
WS3 - $2,578


Trading Outlook:
Ethereum have started the next wave up and violated the long-term target at the level of $3,000. 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
InstaFintech Group © 2007-2021

[IFX_Selena]

Technical Analysis of BTC/USD for August 20, 2021

Crypto Industry News:
US banking giant JPMorgan Chase has reportedly blocked all activity on the accounts of Compass Mining, a Delaware-based Bitcoin mining company. The information came to light when Compass Mining CEO Whit Gibbs announced:

"Greetings to Chase for closing Compass Mining accounts for contributing to the replacement of the old guard with sovereign, future-focused hard currency supporters. Stand up for #Bitcoin or get out of our way."

Compass Mining has been committed to offering mining platforms and Bitcoin mining hardware hosting services. Relying on the support of hash rate and the Bitcoin network, the company enables individual users to undertake mining operations through its private infrastructure.

JPMorgan has previously shown support for the cryptocurrency ecosystem - from searching for Blockchain talent to giving wealthy investors access to crypto funds.

On August 6, in an effort to offer clients exposure to cryptocurrencies, JPMorgan allowed access to six crypto funds over a three-week period. This move gave traditional investors exposure to the Stone Ridge Bitcoin strategic fund, which intended to develop a strategy around Bitcoin futures and combine Bitcoin's direct and indirect investments.

Last month, Mary Callahan Erdoes, director of asset and wealth management at JPMorgan, highlighted the importance of meeting the demand for crypto investments.


Technical Market Outlook:
The BTC/USD pair has resumed the up move after the local low was made at the level of $43,864. The bulls had bounced from the lower channel line and are heading towards the local high seen at $48,069. The strong and positive momentum supports the short-term bullish outlook for BTC. The nearest technical support is located at $46,719.

Weekly Pivot Points:
WR3 - $54,673
WR2 - $51,130
WR1 - $49,247

Weekly Pivot - $46,037
WS1 - $43,891
WS2 - $45,515
WS3 - $38,510


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 $47,000. 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
InstaFintech Group © 2007-2021

[IFX_Selena]

Bloomberg: Bitcoin's biggest problem is Ether. Binance is being sued



Bitcoin made a perfect rebound from the support level of $43,852 yesterday, and at the same time from the ascending trend line, thus forming an excellent buy signal. Subsequently, the quotes of bitcoin rose again to the level of $47,500 and buyers are likely to storm this level in the coming hours. Overcoming this level will allow the bulls to maintain an upward trend, and therefore, rely on the further growth of the number one cryptocurrency in the world. At the same time, the price has already bounced twice from the level of $47,500, and there was no super-positive news for bitcoin over the past day. Thus, we are once again asking the question, what were the reasons for the growth of "digital gold" by $18,000 over the past month? So far, we have not found an answer to this question.

Meanwhile, one of the chief strategists of Bloomberg, Mike McGlone, said that the main factor that holds back the further growth of bitcoin is ethereum. Moreover, it is very interesting that this statement was made exactly when bitcoin has already risen by $18,000 and is no longer so far from its absolute highs. However, it seems that according to McGlone, the potential of bitcoin is much higher, but the markets have recently been buying Ethereum more and more often, and not bitcoin. McGlone believes that this is due to the fact that Ether is a "billing block for the entire fintech, DeFi and infrastructure in the world that's going digital". Earlier, a Bloomberg analyst has repeatedly predicted that bitcoin will grow to $100,000 per coin. However, now he doubts this, because if Ethereum becomes mainstream for the whole world as Bitcoin once became, it may prevent the first cryptocurrency from maintaining a bullish trend.

Meanwhile, the Binance cryptocurrency exchange was sued by a group of international traders who accused it of being unable to provide customers with access to its infrastructure during maximum loads. Traders blamed the Binance exchange for large losses and hope that other investors will sign up to their $20 million lawsuit. Traders say that on May 19, when the cryptocurrency market collapsed due to the actions of the Chinese authorities, there was a failure on the exchange that did not allow transactions to be made at a very important time, which, in turn, led to losses.



Technically, bitcoin continues to be in an upward movement on the daily timeframe and has twice worked out the level of $47,500, which is the minimum of April 26, as well as 50% of the movement from the absolute maximum of the value to the minimum of 2021. If the level of $47,500 is overcome, you should continue to buy bitcoin with a target of $50,700. If the quotes are fixed below $43,852, sell with the first target of $40,746.





Paolo Greco
Analytical expert
InstaFintech Group © 2007-2021

[IFX_Selena]

Mike McGlone: Ethereum might be the reason why Bitcoin is not continuing its growth



According to McGlone, Ethereum, with its hype and mainstreamness, is the only factor that is holding back Bitcoin's growth.

He is confident that Bitcoin has all the prerequisites to continue its bullish movement, but the development of Ethereum by leaps and bounds, its mainstream adaptation, the imminent release of the new Ethereum 2.0 model prevent the main digital asset from breaking through the level of $ 100,000. McGlone responded with regard to the fair value of Ethereum and stated that Ethereum has every chance to surpass Bitcoin in the future both in terms of the number of hodlers who store it on their wallets and in terms of global capitalization. If so, it can become the number one cryptocurrency.

The entrance of Ethereum into the mainstream slows down Bitcoin's breaking through of its historical highs very much. People are beginning to realize that the ETH network is a real magic wand, a payment block for all financial technologies. NFT is also one of the main prerequisites for the accelerated growth of Ethereum.

Currently, non-interchangeable tokens are extremely discussed and popular. More and more people are turning their attention to NFTs, which are built on the Ethereum network – this is one of the main catalysts for the growth of Ethereum's price. McGlone emphasized that Ethereum is unlikely to break through the mark of $ 20,000 this year, but it can surpass the price of $ 4000-5000 by the end of the 4th quarter.

The number of new or zero Ethereum wallets has also increased, and there are more and more holders and addresses that store at least 1000 or more ETH on their accounts. At the moment, Ethereum is trading at a price of $ 3,000, and the main driver for overcoming the $ 3,000 level was the launch of the London hard fork.





Vitaly Kolesnikov
Analytical expert
InstaFintech Group © 2007-2021

[IFX_Selena]

Bitcoin ends its temporary decline

Bitcoin rallied in the last hours and it seems poised to come back higher. It has increased after reaching strong support levels. I've mentioned earlier that BTC/USD could register only a temporary decline before jumping higher. The volume is up by 0.04% in the last 24H.

It's located at 45,511.69 below 45,950 today's high. BTC/USD has increased by more than 4.5% today. Still, we need confirmation that the price of Bitcoin will jump towards 50,000 psychological level. The bias is still bullish, so we can search for long opportunities.


BTC/USD BOUNCE BACK


BTC/USD dropped after its failure to stabilize above 45,998.71 weekly pivot point. It has retested the uptrend line failing to reach and retest the weekly S1 (43,813.93) level. As you already know from my analysis, Bitcoin is bullish as long as it stays above the uptrend line.

The weekly pivot point is seen as a static resistance. Jumping and stabilizing above it may signal further growth. The bullish engulfing pattern printed earlier signals strong buyers. Technically, only a valid breakout below the uptrend line could invalidate an upside continuation.


BITCOIN FORECAST
Jumping and closing above the 45,998.71 weekly pivot point is seen as a bullish signal. 48,190 higher high is seen as a near-term upside target. Only a new higher high could validate a larger upwards movement.





Ralph Shedler
Analytical expert
InstaFintech Group © 2007-2021

[IFX_Selena]

Bitcoin: Two Good Reasons for a Bullish Forecast

Bitcoin has been declining all week and is testing the support of the 44,807.24 - 48,178.13 corridor between the two red dotted lines for the third day. But the level of 44,807.24 is still quite solid. This technical picture is still relevant for all short-term technical forecasts: recovery in the specified sideways or a deeper correction to the level of 41,980.24 in case of going down from the specified corridor.

Although the daily candle has not yet closed, a bullish engulfing reversal pattern is emerging near the support level of 44,807.24. This means that a sideways reversal looks more likely. But let's not get ahead of ourselves.

While everything is clear locally, let's look above - at the long-term picture and fundamental factors on which the dynamics of the main cryptocurrency will depend. And after bitcoin, altcoins will catch up.

One of the main factors behind most long-term bullish forecasts is widespread adoption and exponential growth. Numerous opinions that Bitcoin will reach $100,000 by the end of 2021 are no longer surprising, and this figure ceases to seem transcendental. But analyst Scott Melker believes that in the longer term, the main cryptocurrency will become a "seven-figure asset".

Melker calls the SEC permission to create cryptocurrency ETFs a key condition for this. Now the Commission is awaiting a decision on applications from many well-known companies. Once the green light goes on for these funds, Bitcoin could outperform gold in terms of market capitalization.

The conclusion seems logical, as the emergence of numerous crypto ETFs will open up opportunities for institutional and retail investors to simply invest in the main cryptocurrency.

Melker believes that the approval of funds will create an inflow of investments from various funds, and if they invest only 1-2 percent of their funds in bitcoin, this will lead to a significant increase in the capitalization of the cryptocurrency market.

Another fundamental reason for Bitcoin's growth is its advantage over gold in many ways, including its characteristics and value.

"The deflationary asset mathematically proves its superiority over gold in all respects. With halving, the supply of bitcoins is halved every four years. In the future 10-20 years, I think bitcoin will easily become a seven-figure asset," the analyst said.

What about gold? Gold is "pretty much dead and Bitcoin will replace it as the best option," Melker said.

Another analyst, nicknamed Pentoshi on Twitter, echoed Melker's predictions. But he went even further and stated that in the current market he would choose Bitcoin over Ethereum. And the main cryptocurrency "will remind everyone who is king here."






Ekaterina Kiseleva
Analytical expert
InstaFintech Group © 2007-2021

[IFX_Selena]

Trading Signal for Bitcoin for August 19 - 20, 2021: Buy above $ 43,750



Bitcoin price was trading at 44,273 this morning of the American session, close to the strong 6/8 Murray support located at 43,750. We believe there could be a further bullish momentum for Bitcoin due to the formation of a descending wedge pattern.

The 21 SMA located on the 4-hour chart at 45,500 could offer some resistance if BTC starts a bullish cycle, a sharp break above the technical pattern and a consolidation above the 21 SMA could quickly rise to the resistance to 7/8 of Murray located at 46,875 and could reach up to the psychological level of 50,000 (8/8).

Conversely, a break and consolidation below 6/8 of Murray and below the descending wedge pattern may provide an opportunity to sell below 43,000 with targets at 39,703 (EMA 200). If the bearish force continues to prevail, it could go up to the 4/8 Murray level near 37,500.

Our outlook will continue to be bullish for BTC only if it holds above 6/8 Murray with short-term targets towards the level of 50,000. The Eagle indicator is showing an oversold signal with a probability of a new bullish momentum in the next hours.


Support and Resistance Levels for August 19 - 20, 2021
Resistance (3) 47,376
Resistance (2) 46,661
Resistance (1) 45,551

Support (1) 43,537
Support (2) 43,009
Support (3) 41,889




Dimitrios Zappas
Analytical expert
InstaFintech Group © 2007-2021