Cryptocurrency Analysis

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Cryptocurrency market cap hits $ 2.5 trillion

The total market value of all cryptocurrencies has reached $ 2.5 trillion. Tokens have hit record levels, and some of them, Ethereum for instance, has shown gigantic leaps. But this unprecedented scenario is alarming for many analysts as they believe it could deal destructive effects on the market.

In fact, the ongoing crypto rally may even give birth to an entirely new asset class.

But traders should remember that cryptocurrencies are prone to manipulation, and Dogecoin is a prime example of this. DOGE, which started as a joke in 2013, now has a market value of approximately $ 65 billion, thanks to Tesla CEO Elon Musk.

Musk has recently been talking about the cryptocurrency, pushing its value up in the market. His latest statement is an inquiry of whether Tesla should accept DOGE as a means of payment.

Meanwhile, leading cryptocurrencies Bitcoin and Ether also have a lot of upside potential. Analysts are even likening BTC to gold, although the issue is still controversial. Bitcoin's market value is expected to reach parity with gold in just five years.



Meanwhile, Ethereum, which takes second place, climbed to a new all-time high - $ 4,300. It grew by more than 2000% over the past year, pushing its market value to $ 500 billion.

These tremendous jumps are very enticing, but traders should remember that cryptocurrencies are speculative in nature, so they have to be cautious when investing.

SoftBank CEO Masayoshi Son even stated that Bitcoin is unlikely to soar very high, and when asked about the growing number of crypto investments from companies such as Tesla, he answered: "There are a lot of talks on whether those are good or bad. To be honest, I do not know."

Recently, many companies have placed investments on cryptocurrencies. Some even started to accept them as forms of payment. And today, a fairly large influx of Bitcoin has been recorded on Bitfinex. According to CryptoQuant, Bitfinex received two large batches - 8,000 BTC and 10,400 BTC.





Jakub Novak
Analytical expert
InstaForex Group © 2007-2021

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SEC warns that Bitcoin is highly speculative and could cause investor loss

With the growing interest in bitcoin and other cryptocurrency assets, the US Securities and Exchange Commission issued a warning to investors who own Bitcoin futures: Beware of risks.

They reminded that even though the cryptocurrency is becoming more and more popular, it is "highly speculative" and volatile, not to mention traded in a lightly-regulated market. Therefore, investors should be cautious in their transactions, more carefully weighing the risks Bitcoin investments pose.



The warning came just weeks after Gary Gensler took over as chairman of the SEC. His comments threw off many investors, especially those who expected that ETFs would be approved under his leadership.

Earlier this week, the SEC said it will consider the creation of the first cryptocurrency ETF fund. They will examine whether the Bitcoin futures market is "appropriate" for creating investment ETF funds, and if these funds are able to liquidate their cryptocurrency derivatives if necessary.

On a different note, MoneyGram announced that it formed a partnership with Coinme. Under the agreement, more Bitcoin service will be available starting May, which will help US customers, especially new users, on BTC transactions. This move is expected to add fuel to the bull market that has been observed this year.

But at the time of writing, Bitcoin is at a risky level. A lot will depend on $ 55,400, as a break below it will quickly push the quote towards $ 52,000, and then $ 47,500. Growth will occur only if traders manage to push Bitcoin to $ 60,000. Such will result in a larger jump towards $ 62,300 and $ 64,700.



Another interesting news is the plans of the Hungarian government to reduce income tax in cryptocurrency next year. They believe it would encourage investors to declare income from trading digital tokens. The government said it would cut the rate from 30.5% to 15% starting in 2022. The driver seems to be officials' fears that investors are hiding profits from cryptocurrency trading.

Meanwhile, other countries have taken an aggressive approach. Canada, for instance, is on the path of tightening the turnover of cryptocurrencies and tokens.




Jakub Novak
Analytical expert
InstaForex Group © 2007-2021

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Technical Analysis of BTC/USD for May 13, 2021

Crypto Industry News:
Tesla CEO Elon Musk said the company will no longer accept bitcoin as payment for its cars, citing concerns over energy consumption levels associated with cryptocurrency mining.

Musk wrote: "We are concerned about the sharp increase in the use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel."

Tesla began accepting BTC as payment in February after it bought $ 1.5 billion worth of digital assets. Tesla buy-in news shifted the market - from $ 39,000 at the time of the February 8 announcement to $ 53,000 a week later.

It also led to opposition from environmentally conscious consumers. Many of them said Tesla's purchase of bitcoins ran counter to its pro-environmental image. Some Tesla shareholders did not like the move as well. It began to be seen as drawing attention to the company that has nothing to do with its actual activities.


Technical Market Outlook:
The BTC/USD pair had crashed below the level of $50,000 again and made a new low at the level of $46,615. There is a massive Pin Bar candlestick made just above the level of $47,077, which is the swing low from April 26th. The nearest technical resistance is seen at the level of $51,229, but now there are more levels for bulls waiting at $52,620, $52,921 and $53,799 and $54,719. However, the bulls managed to retrace 38% of the last wave down and the market is test the level of $50,944. Any failure to break out higher would reverse the recent gains and most likely continue the wave down.

Weekly Pivot Points:
WR3 - $67,229
WR2 - $63,211
WR1 - $60,975

Weekly Pivot - $56,852
WS1 - $54,336
WS2 - $50,318
WS3 - $48,012


Trading Recommendations:
Event despite the recent correction from $64,789 to $47,060 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. Any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $50,000 is clearly broken on the daily time frame chart (daily candle close below $50k).






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

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Trading plan for Bitcoin for May 13, 2021



Technical outlook:
Bitcoin finally dropped below $47,00 levels yesterday before pulling back as bears tighten their grip lower. The crypto asset dropped in-line with what was discussed yesterday and printed an intraday low around $45,000 before pulling back higher again. Traders are advised to lock in partial profits on short positions and move stop loss to breakeven.

Bitcoin is still low away from carving a bottom around the $41,000-43,000 mark. A push above $57,000-5,8000 from here would confirm that a bottom is formed and bulls are back in control. The crypto was seen to be trading around the $51,000 levels at the moment of writing and it is expected to turn lower again towards $41,000 very soon.

The crypto asset might be producing a counter trend corrective drop and find support around the Fibonacci 0.382 retracement of the entire rally. The $41,000 mark acted as previous support as marked on the chart here. Potential for a bullish turn remains higher. Prepare for another drop and lock in profits between the $41,000 and $43,000 zone.


Trading plan:
Remain short, move stop to breakeven. Take profit @ $43,000.

Good luck!




Oscar Ton
Analytical expert
InstaForex Group © 2007-2021

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Technical Analysis of ETH/USD for May 13, 2021

Crypto Industry News:

During the first 7 days from the introduction of Ethereum Futures to the market by CME, the value of concluded contracts exceeded USD 23 million. According to a recent OKEx Insights report, "partial data for the week ending April 25 shows weekly volumes hit an all-time high of $ 353 million - over 166% more than the previous week's $ 132.57 million."

Moreover, the number of contracts opened in the CME Ether Futures market also increased at a similar pace. The aforementioned report showed in this respect that:

"During the first month of trading, ETH Futures had an average Open Interest of $ 61.17 million. March data showed a significant spike in activity with average Open Interest peaked at $ 101.67 million.

In fact, since April 21, OI figures have risen to $ 205.6 million, reflecting the size of institutional measures that hit the Ethereum market in the last few months.

According to OKEx Insights, one of the main factors behind this was the normalization of mainstream cryptocurrency investing. The authors of the report argue that it was a byproduct of MicroStrategy, MassMutual and Tesla's entry into the cryptocurrency space, and each of these companies' actions legitimized a sector that had long struggled for Wall Street's attention.


Technical Market Outlook:
The ETH/USD pair has tested the key short-term technical support located at the level of $3,596 and bounced more than 50% already. The next local target for bulls is the 61% Fibonacci retracement located at the level of $4,074. If this retracement level is clearly violated, then bulls will likely test the ATH again (located at $4,369). The momentum is strong and positive, so it supports the bullish outlook for ETH.

Weekly Pivot Points:
WR3 - $4,545
WR2 - $4,714
WR1 - $4,394

Weekly Pivot - $3,656
WS1 - $3,369
WS2 - $2,577
WS3 - $2,290


Trading Recommendations:
The longer term up trend on the Ethereum continues despite the local counter-trend corrections. The next long term target for ETH/USD is seen at the level of $5,000. The key long term technical support is seen at the level of $3,881, so only a weekly candle close below this level will invalidate the bullish scenario.






Sebastian Seliga
Analytical expert
InstaForex Group © 2007-2021

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Dogecoin loses 50%

Hello, dear traders! Here is my trading idea for Dogecoin



Yesterday, Dogecoin lost 50%.

The fall in the value of the digital coin became the culmination of the 4-day downward trend that ended with a major crash yesterday.



Notably, Dogecoin was not the only cryptocurrency to plunge yesterday.

Bitcoin lost $10,000 for a day, marking one of its record falls. The price collapsed after Elon Musk's announcement that Tesla halts purchases of its electric vehicles with BTC due to rapidly increasing use of fossil fuels for bitcoin mining.



Our task is to make money. In this case, we should buy the instrument that tumbled the most, and this is Dogecoin. The token currently costs some 50% of its value. Entering long positions in the 0.4 zone with a 0.1% risk, a Take Profit can be set at 0.8, which is 100% of the investment (see the chart above).

Have a nice trading day!




Andrey Shevchenko
Analytical expert
InstaForex Group © 2007-2021