Cryptocurrency Analysis

[IFX_Selena]

The cryptocurrency market collapses like a house of cards



Almost every aspect of the cryptocurrency market now resembles the concept of 'house of cards'. The meaning of this expression is that if you draw one card, everything else collapses. And the same thing is now happening in the cryptocurrency market. After Bitcoin started to fall in price, all other cryptocurrencies also began to fall in price, although a couple of weeks ago, the "altcoin season" was being discussed with might and main. But as it turned out, as soon as the sales began, everyone immediately began to sell ether, litecoin, and other alternative tokens. The same goes for investors. As soon as the coins were sold off conditionally by Elon Musk (-10% for bitcoin from Tesla), other companies and institutions immediately began to reduce their investments in digital gold, except for MicroStrategy, which seems to be going to own bitcoin in proud solitude. The same goes for the fundamental background. As soon as the negative news from China began to arrive, they immediately began to provoke the appearance of new equally negative news. For example, this weekend, the Chinese cryptocurrency exchange Huobi announced the suspension and even curtailment of a number of areas of its activities and services for investors. It is not surprising if the Chinese authorities have begun to prohibit financial organizations from providing any services related to bitcoin, and in the near future they may even ban mining. Recall that in China, there are not only a lot of mining farms, but also a huge number of exchanges. It is clear that miners will find a way to mine cryptocurrency outside of China, but exchanges will have a hard time. There are plenty of places where you can place mining equipment on the ground. The problem is that bitcoin reacted to this news with a collapse. And the less it costs, the less profitable it is to mine it. Especially considering the increased prices for mining equipment over the past year. So, the fundamental background is not just bad at the moment, it continues to deteriorate. In the near future, we can expect some more surprises. Of course, it will not be without a new batch of forecasts that bitcoin "is about to rise in price to $100,000". But we are very realistic and do not own hundreds and thousands of bitcoin coins. Therefore, we believe that, at least, a long period of consolidation of the cryptocurrency begins. As a maximum, the collapse of the entire cryptocurrency market will continue.



Technically, Bitcoin fell to two important support levels on the 4-hour timeframe. The upward movement was very short-lived and now we recommend traders to monitor the behavior of bitcoin around the level of $30,500 and $29,873. If the price breaks these levels, then Bitcoin may continue its collapse.






Paolo Greco
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

BTC analysis for May 24,.2021 - Inside days formation and potential for the breakout

Technical analysis:


BTC has been trading sideways at the price of $37.000 but I see potential for the breakout.


Trading recommendation:
My advice is to watch for the breakout of the inside formation to confirm further direction.

Resistance is set at $43.000
Support is set at $29.000

Downside breakout of the support at $29.000 can lead BTC towards the $22.000

Upside breakout of the resistance at $43.000 can lead BTC towards the $.48.000





Petar Jacimovic
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Short-term reversal signs in Bitcoin.

Bitcoin made another pull back towards $30,000 but price did not break recent low. Instead price is now bouncing higher towards $40,000 and so far price has broken the short-term resistance trend line at $37,000.



Red rectangle- major resistance

Red line - short-term resistance

Blue lines- Fibonacci retracements

Bitcoin has been in a bearish short-term trend since early April and the reversal from the $58,000 level. Bitcoin has so far retraced more than 50% of the entire rise from the 2018 lows. The RSI has already provided a bullish divergence in the 4 hour chart and price is now breaking above the red resistance trend line. Bitcoin could continue higher towards the red rectangle horizontal resistance where we expect to see the most important test for bulls. So a bounce towards $47,000 is justified and not out of the question. However even if price moves towards that level, it will not mean that a major low is in. Yes support is important around $30,000, but for now we can not talk about a major low.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

XRP back tests major broken resistance area.

So far the worst possible scenario for XRP has been confirmed. Price broke below the key support levels of $1,2 and $0.83 and has tested the major support, previous resistance area of $0.65-$0.75. Price today bounced off this break out area and so far we have a bullish back test of broken resistance.



Green rectangle - major support

Red line - support trend line

XRP/USD is now trading above $0.85 again. It was only a one and a half month ago when prices were challenging the green rectangle area and were breaking out. Now price is back testing the support around this level. Bulls need to respect both the upward sloping red support trend line and the horizontal support. Bouncing off the support level is a bullish sign but it is still too early to call a major low in.





Alexandros Yfantis
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Ethereum New Swing Higher!

ETH/USD is bullish again after failing to close below a support area. Technically, a rebound is natural after the amazing sell-off. It has found strong support and now it has taken out a dynamic resistance.

It's trading at 2,422.06 versus 1,730 yesterday's low. Now is located right below a static resistance. Registering a valid breakout could signal broader growth. Ethereum dropped by more than 60% since May 12, 2021, but now, the rate seems poised to come back higher.


ETH/USD TURNED TO THE UPSIDE!


I've told you in my previous analyses that the bias remains bearish as long as the price stays below the first warning line (wl1) of the descending pitchfork. ETH/USD has found support on the $1,930 level registering only a false breakdown through 1,800 psychological level and below the upper median line (uml).

Taking out the weekly pivot of 2,472.27 should indicate a potential growth towards 2,800 and 3,000 levels. Being rejected by the weekly pivot or registering only a false breakout could signal that ETH/USD may drop a little towards the 2,200 - 2,000 area.


ETHEREUM FORECAST!

The aggressive breakout through the warning line (wl1) signaled that the downside movement could be over. Still, we cannot exclude a temporary decline from the weekly pivot.

Actually, a temporary decline could help us to catch a new upwards momentum. Personally, I would like to see consolidation and other false breakdowns below the immediate support levels before really developing a new swing higher.





Ralph Shedler
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Cryptocurrency market analysis on May 24. Bitcoin prepares to rise to $42,000



The wave counting on the 4-hour chart of bitcoin is absolutely clear on the higher scale. At this time, we see a classic three-wave correction structure a-b-c. If the current wave counting is correct, then at least three upward waves should follow. Two of these three waves have already been built, therefore, we can count on the construction of wave c soon. Targets for this wave can be located near the 50.0% Fibonacci level, which equates to $46,800, or at least around the 61.8% Fibonacci level, which corresponds to $42,500. But let me remind you that bitcoin is very vulnerable to the news background. If tomorrow, for example, new important information arrives on the market, this may well once again collapse the bitcoin quotes. But the wave counting now speaks of a very likely increase in the quotes of the main cryptocurrency. I am not considering alternative wave counting options now, as there are no grounds for this.

The mood in the cryptocurrency market remains depressing. Along with bitcoin, many other cryptocurrencies are also falling in price. Investors are not buying bitcoin now, despite its rather low cost. This means that at this time, there is no faith in a new upward trend section. In addition, even without taking into account the possible actions of Elon Musk or his new statements, which have a strong impact on the entire market, the news background is now full of other important messages that could affect bitcoin in the worst possible way. As previously mentioned, the United States is planning to introduce new tax legislation, which will require all transactions over $10,000 to be submitted to the IRS for review. Thus, many investors can opt out of cryptocurrency transactions, since they will no longer be anonymous in the literal sense of the word.

The US government, led by Joe Biden, believes that many investors are using cryptocurrencies for tax evasion, so they are going to pass new legislation. Of course, it may take more than one month before this law is signed by the president and comes into force. After all, this requires that the US Congress also approve it. Nevertheless, the outlook is rather bleak. The prospects for bitcoin in China are even worse, where they are going to ban any mining of cryptocurrencies altogether. Here, too, everything is at the level of rumors and conversations. But, as they say, there is no smoke without fire. Thus, I can conclude that there is no new reason for investors to buy bitcoin so far. If these bills fail eventually, then the news background for bitcoin will dramatically improve. In the meantime, I really do not see any prospects for the main cryptocurrency above $42,000. And I am considering this option only because the wave counting speaks in its favor.

Based on the analysis, I believe that the three-wave downward structure is complete. However, the movements of recent days have been so fast and strong that it will take some time for the market to clear up. The current wave counting indicates a possible increase, so I recommend small purchases of bitcoin for each MACD signal "up" with targets located around $42,500. A failed attempt to break through the 61.8% Fibonacci level could lead to another strong decline in bitcoin.





Chin Zhao
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Trading Signal for BITCOIN for May 24 - 25, 2021: Buy above $37,500



In the early hours of the American session, Bitcoin BTC/USD is trading at the 2/8 murray level, a key area. If the BTC remains above this level, there could be a new upward momentum to the zone $43,750.

The crackdown on crypto miners in China - who account for around 70% of the world's supply - is the latest episode in a series of actions that Beijing is taking against the digital currency sector. Some investors and analysts in the digital currency market have claimed that fears about China's regulatory measures could persist.

During the weekend we saw that BTC fell to the 1/8 murray zone, key support, and demonstrating the strength of this level that coincides with the psychological level of $ 30,000. BTC / USD has set a floor for now, and as long as it remains above $30,000, there is a probability that it will hit the psychological level of $50,000.

On the 4-hour BTC chart, you can see a trend line drawn from the beginning of the BTC decline, to the low of $31,000. That line has been broken. If BTC consolidates above that channel bearish, it could be released from the downward pressure and there could be a further bullish momentum to $45,000 and the zone of $50,000 in the short term.

We can also observe the double bottom, which represents a good zone to buy if the price again makes a correction towards this zone.

Our recommendation is to buy the BTC at the current levels above $37,500 with targets at $43,750 and $50,000 zone of the 200 EMA.


Support and Resistance Levels for May 24 – 25, 2021
Resistance (3) 43,676
Resistance (2) 41,595
Resistance (1) 38,465

Support (1) 36,112
Support (2) 34,146
Support (3) 30,397




Dimitrios Zappas
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Bitcoin: Hectic weekend, encouraging Monday. What to expect from the main cryptocurrency?

The weekend in the cryptocurrency market has been hectic. Bitcoin has tumbled, pulling altcoins along with it as the Chinese government tightens its crackdown on mining companies.

Plans to attack bitcoin mining and trading in the country became known from the statement of the State Council Committee. A cabinet decision led by Chinese Vice Premier Liu He showed that regulatory controls are aimed at mining virtual currency as a way to protect against financial risks.

Some miners, such as Huobi and BTC.TOP responded by saying they would suspend operations in mainland China.

Thus, Huobi announced that it has suspended cryptocurrency mining and the provision of trading services to new clients. Instead, the company intends to focus on providing services overseas.

Mining company BTC.TOP, in announcing the termination of operations in China, cited growing concerns about regulatory requirements. And HashCow has announced that it will not invest in any new BTC mining rigs.

The mining ban was the second blow from China to the cryptocurrency market. But, as we can see, its influence was already as strong as the collapse of the "bloody Wednesday". On Sunday, bitcoin lost 17%, at the moment it went into the area of $31,000 per coin but did not update the minimum of a week.

What's next? The range of 28,392.99 - 41,980.24 remains a broad frame for bitcoin. Locally, the level of 38,610.88 was outlined as a resistance, which worked before, and now it may remain the actual resistance. But not a fact, we must observe.

As the target for the downward trend, it is worth keeping in mind the minimum of the "bloody Wednesday" - the level of 29,348.95. But so far, the breakdown of support level 34,708.27 is questionable.

Well, the technical picture can hardly be called clear, except for the "wide frame" - the corridor 28,392.99 - 41,980.24. And locally, the situation is likely to become clearer in the coming days. At least, if no new shocks follow, bitcoin will recover. And it is necessary to wait for the formation of the border of this growth.







Ekaterina Kiseleva
Analytical expert
InstaForex Group © 2007-2021

[IFX_Selena]

Major altcoins are recovering after the weekend crash: forecasts

The main cryptocurrencies again sank heavily in terms of indicators over the weekend due to the sale, which was arranged by market participants. Because of this, many altcoins have hit three-month lows. However, at the beginning of the new week, when the negative from China was completely won back, the indicators of cryptocurrencies crawled up again. Due to the rapid growth, the total cryptocurrency market capitalization increased by 16.5%, reaching $1.62 trillion.

The main altcoin began to recover its positions at a rapid pace and is already approaching a two-week high. ETH has risen in price by 25.5% per day with daily trading volumes of $81 billion, which indicates an increased demand for the asset. Given the narrower dynamics of price changes, the demand for buying a coin is much higher than for selling. Due to the favorable positions for new players to enter the ETH network, as well as the approaching next stage of the update, the ether is getting to the historical maximum faster than others. At the next stage of the update, miners' commissions should decrease, and the network bandwidth may also increase, which promises the asset a multiple increase in quotes. Judging by the horizontal charts, the cryptocurrency will approach the important milestone of $2,500 soon, after which the coin will roll back. ETH will likely try to gain a foothold behind this mark and approach another important milestone of $2,900, where strong market resistance is also concentrated.





The Ripple token, which broke through all the supports and turned out to be at the level of the February minimum, is also beginning to recover its positions. Although the fall in the asset was much stronger than ETH, XRP's growth is only 15% per day. The cryptocurrency is quoted at $0.851, while daily trading volumes remain low, which indicates a greater predisposition of players to other assets. Despite this, cryptocurrencies retain their audience, and now the quotes of the coin are at the most favorable line for the entry of new players. XRP/USD will soon climb to the dangerous $1,000 mark, and the coin will need a powerful impulse to overcome this mark.



LTC is recovering at about the same level as XRP, which has risen in price by 14% over the course of a day. The position of the cryptocurrency was seriously shaken over the weekend, and the coin slipped to 12th place in terms of capitalization with a result of $11 billion. The current rate of price growth suggests that the asset is still not of interest to large investors and is a tool for trading small traders. Soon, the cryptocurrency will focus on the performance of stronger altcoins and will try to overcome the $200 mark and gain a foothold above it.



Even though the market is showing growth, there are all prerequisites for subsequent jumps in the value of cryptocurrencies due to the constant flow of negative news from China. Recently it became known that Huobi is significantly reducing the supply of mining equipment, and some companies for the extraction of crypto assets are beginning to scale back production to move to safer countries. In addition, the last market downturn occurred on May 22-23, and large investors continue to campaign to reduce their presence in the cryptocurrency market in favor of more stable instruments. This is because a series of announcements related to the problems of mining companies will continue until the Chinese authorities seek a compromise with the market or the complete withdrawal of business from this country. Do not forget about the ambiguous position of the US regulator, which continues to butt with Ripple, and also launched an investigation into Musk's influence on the crypto market. Given all this, there is no reason to hope that the current growth in coin performance will be the beginning of an upward trend and, most likely, in the near future, the trend for sudden wide fluctuations in the range of 10% -15% of the total cryptocurrency market capitalization will continue.





Artem Petrenko
Analytical expert
InstaForex Group © 2007-2021