Cryptocurrency Analysis

[IFX_Selena]

XRP/USD remains under pressure, vulnerable to more downside.

XRP/USD price made another dive yesterday towards $1.30 after getting rejected once again at the major resistance area of $1.55-$1.65. Short-term trend is vulnerable to a move towards $1.18-$1 as long as price is below $1.65.



Red rectangle - resistance

Green rectangle - support

Blue lines - Fibonacci retracement

Price has so far retraced 61.8% of the rise from $0.88 to $1.76. Support is the recent low at $1.22. We warned traders in a previous analysis that a break below $1.35 would lead to a move towards $1.18 which was our next pull back target. Price so far reached $1.22. Breaking below $1.22 now would be a sign of weakness. This could lead to a move towards $1 or even lower. On the other hand bulls need to recapture $1.57 in order to hope for a trend reversal. So far price has made a higher low at $1.22. If bulls manage to make a higher high above $1.76 then we will have a strong bullish sign implying that a move above $2 is very close.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

ETH hits new record, LTC and XRP continue to fluctuate: analysis and forecast for major altcoin pairs

A redistribution of responsibilities and authorities is observed in the cryptocurrency market recently. In the second quarter of 2021, altcoins took the first positions, which historically are much better than bitcoin during this period. In recent weeks, a picture has emerged in which ETH is leading the market, while other assets are trying to keep up. However, after a long and powerful growth, the indicators of cryptocurrencies were overtaken by a wave of correction. As a result, over the past day, the total cryptocurrency market capitalization has decreased by 4.5%.

The main culprit for the slight downturn was ether, which recently set a new all-time high of $4,158. After that, the charts of the asset show a slight decline, to $3,900, where the cryptocurrency again tried to cross over $4,000 with varying success. As of 12:00 UTC, these attempts were unsuccessful and ETH fell by 3.4% per day. At the same time, indicators of daily trading volumes remain at a decent level of $83 billion and are ahead of similar indicators of bitcoin. Ethereum's total capitalization surpassed Bank of America, Walmart, and Mastercard. Ether is now the top 1 cryptocurrency in the world due to active growth and constantly improving algorithms on the network. The situation is aggravated by the problems of bitcoin, which significantly oversaturated the market and sags under the pressure of bears. All these factors were the result of a significant increase in the percentage of ETH's dominance in the market - 18.5%. In the near future, the asset may continue to grow if it manages to gain a foothold at an indicator above $4,000. However, it will be quite difficult to do this due to the negativity that the report of the giant JPMorgan brought to the news agenda, according to which ETH should be worth $1,000.



XRP, which has been trampling in the corridor of $1.40 to $1.60 for more than two weeks, is more deplorable. The cryptocurrency lacks momentum to help the asset overcome the challenging $1.60 milestone. Considering the recent SEC statement, the decline in activity regarding the Ripple token is fully justified and investors are wary of the coin. In addition, the news that Ripple could become a public company after the completion of the trial was fully played by the market and did not help the cryptocurrency to get out of the difficult corridor. Taking into account the correction that has covered the market, XRP indicators may sink even lower if the asset does not have enough support at the current level of $1.42. The cryptocurrency has come close to this dangerous mark, having fallen in price by 10% over the past day.



A similar situation is observed with Litecoin, which has been marking time for more than a week. The cryptocurrency follows the momentum of the ether but has no real prerequisites for overcoming the difficult milestone of $360. Based on this, the coin fell by 10% per day and rolled back to $350. In addition to the correction that swept the market, JPMorgan experts decided to add a little negative, who were very skeptical about the main cryptocurrency at the moment. According to analysts, the real price of Ethereum is 75% lower than the current market price. This news, which coincided with the correction, may negatively affect investor sentiment and drag the quotes of all coins with it. Even less positive was the news that the Indonesian authorities are imposing a tax on profits from transactions with cryptocurrency. Recall that recently the introduction of such a tax was announced in South Korea.



Given the local correction and negative forecasts for the ETH quotes, the decline in the cryptocurrency market may drag on. Soon, it will become clear how market participants will react to the negative news background and how much this will affect the quotes of ether, which at this stage is pulling the entire market with it and contributing to the growth of small cryptocurrencies.





Artem Petrenko
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Ethereum: fundamental factors of the strength of the second cryptocurrency

Ethereum renewed its all-time high again, rising above $4,000 at the moment. Meanwhile, bitcoin is in its consolidation range, and the technical benchmarks have not undergone major changes.

Therefore, today we will consider the second cryptocurrency and the fundamental prerequisites for its further growth. Last week it was said that the ether is likely to be overheated. But while a significant correction is not visible, everything is limited only to consolidation.

Meanwhile, as the price rises, so do the number of active Ethereum addresses. Now, this figure is higher than the previous historical value from January 2018. Analytical company Glassnode reports that on Sunday, May 9, their number reached 7.94 million. In January 2018, the previous high was 7.14 million.

It is noteworthy that in three days when there was a rapid increase in ETH/USD, the number of active Ethereum addresses increased by 100,000. And since the beginning of the year, their number has increased by 86%.

One of the incentives for the growth of the second cryptocurrency is the popularity of DeFi - decentralized finance, as Ethereum creates the basis for this direction. Against this background, experts believe that it will not be difficult for a cryptocurrency to reach a capitalization of $1 trillion.

Shivam Thakral, CEO of the Indian cryptocurrency exchange BuyUcoin, notes that the growth in the number of transactions, active addresses, and the size of commissions are factors that confirm the fundamental strength of Ethereum.

Philip Gradwell of Chainalysis also highlights the upside potential, as the outlook for increased use of ether creates demand for it and therefore drives price appreciation.

It is worth noting that in the first quarter, the Ethereum network experienced congestion and an increase in transaction fees. But there are more and more active addresses, the commissions of market participants do not bother. This means there is a chance for further price strengthening. In addition, the number of searches on Ethereum is increasing, while interest in Bitcoin is decreasing.

As noted in previous reviews, such dynamics may be due to the difference in the price of the first and second cryptocurrencies. Bitcoin has become very expensive for small retail investors. It is possible that while interest in cryptocurrencies continues to grow, Ethereum will benefit more from this than the main coin.

Let's move on to price benchmarks. ETH/USD has technically confirmed 100% Fibo Expansion level (purple line) as support. This means that the closest target for growth is the historic highs set on Monday and the level of 161.8% Fibo Expansion (near 4211.07) passing just above this mark. So far, the second cryptocurrency has a sufficient margin of resistance. And if it is broken, we will apply a new Fibonacci extension to determine the following targets.







Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

CEO of Tesla, Elon Musk, is ready to start accepting Dogecoin as a car payment



During the other day, the Tech King of Tesla and part-time "Dogefather" asked a leading question with a background to his Twitter followers: "Do you want Tesla to start accepting Doge?". This is a deliberate action to artificially raise the price of an ascending cryptocurrency. Since after a recent interview, where Musk jokingly called Dogecoin as a gimmick, the asset has lost 35% of its value. In this case, the "Elon Effect" has not been canceled. On Thursday, this cryptocurrency reached a record value of $ 0.73, and then sharply declined, scaring investors and those who hurriedly rushed to invest in it. Although many experts have warned that the Dogecoin has already peaked, this is too much of a growth of 700%, and it is taboo to take risks now by investing all your savings in it.

Dogecoin has noticeably fallen after a recent interview. So now, Elon is doing everything he can to return the upward trend and the growth of this cryptocurrency. In March, Tesla allowed purchases in BTC, and it was a commotion in the market. After that, the company acquired $ 1.5 billion worth of Bitcoin, making the leading cryptocurrency accelerate rapidly. If Tesla starts accepting Dogecoin as payment, the company will definitely add, let's say, 100,000 Dogecoin to its portfolio. The cheapest model now costs around 0.6 BTC or 78,000 DOGE.

The Twitter poll became incredibly popular, gaining almost 3 million responses, and received approval. Musk recently announced that his other company, SpaceX, will accept Dogecoin as payment and sponsorship of the lunar mission. This can help it increase its price, since Bitcoin is still unstable. It is worth noting that Dogecoin is the asset that is most similar to ordinary money and is convenient for transactions.

The billionaire's tweets have raised concerns with the Securities and Exchange Commission, but not so long ago, claims of a cryptocurrency pretext have yet to lead to some regulatory challenges.

On another note, Tesla's shares subsequently plummeted to 4% in early trading, as this huge car company flatly rejected plans to purchase land to expand its Shanghai plant.




Vitaly Kolesnikov
Analytical expert
InstaForex Group © 2007-2021