Cryptocurrency Analysis

[IFX_Selena]

Bitcoin and Ethereum: China's FUD doesn't scare institutional investors



China continues to scare traders. On September 24, the People's Bank of China released a new set of measures to promote interagency coordination in the fight against crypto activity. Measures to disable payment channels. Everything would be fine if it were not for the fact that these updates were originally published back on September 3, before they were picked up by the Western media.

Many crypto experts are inclined to believe that the negative media background was coordinated to attack the crypto market. The question arises why this was done if the news is not the first freshness.

The answer is simple, it was beneficial for someone.

According to CoinShares' September 27 weekly digital asset fund flows report, there has been a surge in buying from institutional investors.

Following the report, from September 20 to September 24, an inflow of $95 million was seen. The lion's share of the funds was allocated to Bitcoin and Ethereum, $50.2 million and $28.9 million, respectively. The remaining share went to Altcoins.

This kind of purchase is by no means the first or the last; large players almost always build in such a scheme to build up their portfolio. A correction is not a period of fear, it is an opportunity to acquire an asset at a good discount.

This is not the first time the seasonal correction and negative Chinese background have appeared in the market. Experienced traders are not afraid of this much. If we compare the history with corrections and negative news, then almost always there was a fairly good recovery, it only takes time.

In September 2017, the Chinese government banned crypto exchanges from offering services to users in the country, and also banned citizens from participating in ICOs. After the double ban, the Bitcoin price made a historic rise from a range of $4,000 to a record high at the time of about $19,891.

What happens on Bitcoin and Ethereum trading charts?

After Bitcoin returned to the $40,000 psychological level last Friday, nothing dramatic happened anymore. The quote follows within its deviation, where traders have a clear pivot point, relative to which there is a natural reduction in the volume of short positions.

In this situation, it is worth considering two possible scenarios at once: Long & Short.

The upward development of prices is still relevant and considered by market participants. The process of restoration of the volume of long positions should have a gradual nature, with subsequent strengthening, depending on the passage of the reference levels.

The levels of $45,500, $50,000, $60,000, and $65,000 are considered as signal values where the upward interest may increase.

Downward development considers the formation of the deepest corrective move in the market, which is likely to scare traders.

The level of $39,000, where a local decline towards $38,000- $35,000 is possible, is considered as a signal value, where a strengthening of the downward interest is possible.

As for Ethereum, the $2,600 / $2,860 price range serves as the support area, relative to which there is a decrease in the volume of meek positions.

In this situation, an increase in the volume of long positions is possible if the price passes the control levels of $3,200, $3,700, and $4,000.

The downward trend scenario will capture the market again if the price is kept below $2,600, which may well open the way towards $2,250.



The index of emotions (aka fear and greed) of the crypto market is at the level of 24 points, which is considered a rather low indicator. Traders fear a further collapse of the crypto market.







Gven Podolsky
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin creates a base around $40,500.

Bitcoin has been under pressure lately, falling from $50,000 and making lower highs. However recent price action has shown that the $40,500 level has been tested and respected three times and not broken. I do not expect to see a fourth bounce of this level.



Blue line- resistance trend line

Green rectangle- major short-term support

Bitcoin has support at $40,500. Bulls do not want to see this support break. So far we have seen three failed attempts to break it. If price tests the $40,500 again, I expect the support to be broken. As long as price is below the blue trend line resistance, I remain pessimistic for Bitcoin's near future. If Bitcoin fails to hold $40,500, we will get a new bearish signal. Traders need to be cautious. Recent price action has confirmed the support levels that need to hold, for trend to change to bullish again.





Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical analysis for Ethereum



This month was dominated by the bearish mood despite updating the maximum extremum in August. The closing of the month is getting near, and it shows that the situation rested on the consolidation of support levels of 2736 - 2724 (monthly Fibo Kijun + weekly Fibo Kijun), which led to consolidation in the daily timeframe. The breakdown of these support levels will have far-reaching plans. It will form a daily target for the breakdown of the Ichimoku cloud, eliminate the weekly Ichimoku golden cross and open the way for a monthly correction to short-term (2544) and medium-term (2230) trends.

However, the formation of a rebound from the supports encountered and the closing of September with a long lower shadow, as well as the lack of strong bearish advantage, will indicate uncertainty and instability of the current situation. The current attraction is now exerted by the daily levels of 2868 - 2905 (Tenkan + Senkou Span B). To leave the current consolidation zone, the bulls need to break through the weekly medium-term trend (3049) and the daily Fibo Kijun (3151). But in order to obtain a more reliable result that allows us to consider new prospects, it will be important to break through the resistance zone of 3235 – 3354 (weekly levels + daily medium-term trend).



The daily consolidation does not allow directional movement to develop in the smaller timeframes. Traders in the market operate with varying success, moving around key levels. Today, the key levels are located at 2892 (central pivot level) and 2939 (weekly long-term trend), whose testing is now in process. It should be noted that trading and consolidating above these levels will give an advantage to the bulls. The upward targets here are set at 2988 - 3119 - 3215 (classic pivot levels).

In turn, the formation of a rebound and a movement below key levels will support bearish sentiment. In the event of a decline, it may be useful to consider the support of the classic pivot levels currently located at 2761 - 2665 - 2534.

Ichimoku Kinko Hyo (9.26.52) and Kijun-sen levels in the higher time frames, as well as classic Pivot Points and Moving Average (120) on the H1 chart, are used in the technical analysis of this cryptocurrency.





Evangelos Poulakis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

What bitcoin technical indicators can reveal about further price trend during consolidation

Bitcoin was taking confident strides in early September but the collapse in the middle of the month triggered a local sell-off. It caused large volumes of coins to put pressure on the cryptocurrency price. As a result, the volatility of the cryptocurrency increased significantly, which contributed to sharp price fluctuations. BTC began a consolidation to stabilize the swing in the price. As it usually happens, bitcoin's on-chain activity noticeably decreases, trading volumes and the number of unique addresses fall during the consolidation of the price. However, during such pauses between growth and decline, there is always the possibility that market participants may put some pressure on the price. As the cryptocurrency market is shaky after negative news about Chinese sanctions, the bears may try to push the price lower.

Bitcoin's intraday technical charts can show a possible pressure on the price. Over the past 24 hours, BTC was swinging in the narrow range and did not grow. At 1:00 p.m., it is quoted at $42,200 with daily trading volumes dropping to $29 billion. It is important to pay attention to the news while conducting the primary analysis of the cryptocurrency's financial condition. Currently, the news agenda is exacerbated by Chinese giants like Bitmain which suspended selling mining equipment. In the long term, this may lead to a drop in the BTC hash rate and the emergence of failures in the network of the cryptocurrency. In addition, a complete ban on bitcoin transactions in China caused a flurry of activity on crypto platforms, which also puts additional strain on the network and is likely to cause a local collapse.

Onchain activity is the actions of cryptocurrency market players who independently dispose of their crypto-assets, which makes the record go directly to the main blockchain. This statistic includes both private investors and large companies.

Price consolidation is a period of a given cryptocurrency within a narrow horizontal price channel. Usually, this process indicates price stabilization or weakness of market participants (bulls and bears).

Hashrate is the total computational power of the mining equipment. The higher the value, the harder it is to mine cryptocurrencies as new miners are attracted to mining assets.

The 1-hour chart shows a bullish trend with a potential to break through the level of $42,300. The charts indicate the uptrend, which was formed after the bearish triangle pattern. The bullish breakout signals a further robust uptrend. The technical indicators support this sentiment and start the uptrend, indicating strong momentum for the bulls. The MACD indicator is still remaining in the red zone but it managed to cross the zero mark and now is maintaining upward momentum. The MACD also shows a possible reverse to sideways movement as the upward wave is slightly weakening. The RSI shows a similar trend, which is also moving to 50. Overall, the situation on the hourly chart indicates the price stabilization after the local growth cycle. It is likely to move to $42,000, where it may rebound if this is confirmed by the broader analysis periods.



The 4-hour chart shows a clear tendency to a flat (sideways movement), as the main indicators are moving in parallel and indicate that the bulls and bears are not ready to pull the tug-of-war. In addition, a bearish triangle has been forming in the current time frame starting from September 21. At 1:30 p.m., the price is as close as possible to its bullish breakout. There might be a major correction in the daily chart due to an additional bullish momentum. It is likely to happen because the stochastic oscillator and the RSI are in the optimal position for growth. Meanwhile, MACD is close to forming a bullish crossover, which suggests that the bulls may strengthen the bullish momentum and the price is likely to consolidate beyond the bearish triangle.



On the daily chart, BTC does not show a consistent trend, so a breakdown of the bearish patterns on narrower time frames may contribute to the growth of the price. In addition, on the daily chart, there is a pattern of the bearish triangle from September 7. The currency closed the previous two trading sessions with bearish candlesticks, so there is little chance of breaking through the bearish pattern right now. Meanwhile, the stochastic oscillator has formed a bullish cross and the RSI is moving towards 50. MACD continues a downward wave and risks forming a bullish divergence, though there are preconditions for an upside reversal. In general, bitcoin has all chances to start an upward movement at the end of the day, if the bulls manage to beat the bearish patterns.



The Relative Strength Index (RSI) is a technical indicator that allows determining the strength of the trend (downward or upward) and alerts about possible changes in the trend of a price. This metric can determine whether an asset is overbought or underbought. The optimal level for a bullish trend is 60. It indicates a high demand for the coin and the strength of the current upward momentum. When the BTC price crosses this level, it starts moving into the overbought area.

The MACD index (Moving Average Convergence/Divergence) is an indicator that allows drawing certain conclusions about the trend based on the movement of moving averages and finding metric values between them. The usual bullish signal is when the white line crosses the red line from below and the bearish signal, on the contrary, when the white line crosses the red line from above, indicating a downward movement.

Stochastic (stochastic oscillator) indicates the strength of the momentum of the current prevailing trend. If the indicator is above 80, the asset can be considered overbought, but if the stochastic oscillator is below 20, it is a signal that the asset is oversold.

A bearish triangle is a pattern on horizontal charts that suggests a continuation of the downward price movement. A bullish breakout of this pattern is a strong impulse for price growth.





Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

On-chain and technical analysis of the promising LINK/USD pair

The cryptocurrency market failed to show stable growth in September due to the formation of a negative news background and several significant collapses. However, during periods of correction and falling prices, it is possible to track and identify a number of coins that have good prospects for the future. The market has already discovered the ADA and SOL coin projects, but in September, Colin Chainlink intercepted the obvious interest of the institutions. Over the past three weeks, major investors have purchased coins worth more than $1.4 billion, which is almost 3.5% of the total cryptocurrency issue.

Chainlink is a cryptocurrency that facilitates access to goods and services using ETH smart contract technology using the API. Due to this, users can connect to payment systems and make transactions. The coin closes the top 15 crypto assets by market capitalization with a result of $10.3 billion and average daily trading volumes in the region of $937 million. Yesterday, the coin has declined by 7.7% and was trading at $23.22 at 9:00 UTC+00. During the collapse of the crypto market in mid-September, large holders began to actively buy coins, which is why the metric of the number of addresses owning more than 1,000,000 coins reached 16%. As of September 29, this indicator declined to 15.8%, but it is still a high level for an altcoin.



Other on-chain metrics also confirm the growth in demand for the coin over the past few weeks. The indicator of the ratio of the market and realized value of the coin is near the mark of -4%, which indicates that most of the investors who bought the coin are at a loss. Comparing this indicator with a sharp increase in the number of addresses with a large number of LINK/USD, we can conclude that the cryptocurrency is becoming a long-term investment with great potential.



At the same time, another on-chain metric, displaying a unique number of addresses in contact with the altcoin network, indicates a huge gap between the current value of the crypto and the number of users. The indicator has been at a local low since November 2020, and this is due to the screening out of the retail audience due to the collapse of prices and the growth of market volatility. It is also worth considering that the formation of such divergences is an indicator of the growth of the institutionalization of the coin, which has already been confirmed above.



The technical analysis of altcoin suggests that the coin is in a local crisis due to the general mood of the market. On the daily chart, the coin has formed two bearish candles for the last two days and also completed forming a bearish triangle from September 7. The main indicators of the coin have started to recover and are moving up, which may mean a local reversal. But to do this, it is necessary to work out a bearish triangle, and then rise.

The stochastic indicator formed a bullish intersection and began moving towards the 40 mark, and the RSI index has already broken this level and continues to grow. At the same time, the MACD continues to move sideways with hints of a reversal. If the price on the charts does not start to gradually rise in the near future, then this may mean the formation of a bearish divergence.



In general, the sharp interest of institutions in cryptocurrency cannot be accidental, and buying more than 3% of the market supply indicates the long-term prospects of the coin. The on-chain metrics of Chainlink altcoin indicate an increase in the number of holders and growing institutionalization. In addition, the crypt ecosystem tied to ETH will continue to develop due to the versatility and broad capabilities of Ethereum. Considering the current quotes of this altcoin, now is the ideal time to acquire an asset with medium or long-term prospects.





Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin posts its worst monthly reading since May



Bitcoin plunged again on Tuesday, losing a total of 12% this month, which is its worst monthly reading since May. It is also the fifth negative figure for September and the worst rate since 2019.

At the same time, US stocks are under pressure, with the S&P 500 on track for its worst month this year. Arcane Research said the 90-day correlation of the two has grown very significantly over the past days.

For Art Hogan, chief strategist at National Securities, this makes sense because Bitcoin tends to fall when other riskier assets also fall. "What's going down now? All the high-flying, high-multiple riskier assets. And Bitcoin has to place itself in that neighborhood," he said.

Bitcoin has been trading volatilely for many years, and in the past decade, September is the only month that it has not yielded positive results. In fact, it lost an average of more than 6% in six of the previous 10 years.

And this year, it was hit by many problems such as the failed rollout of the coin as legal tender in El Salvador and tightened regulatory oversight in the United States and China.

"The news out of China has put a lid on Bitcoin near-term," said Matt Maley, chief market strategist for Miller Tabak + Co. "Investors are starting to worry that more countries are going to put limits on cryptocurrencies."

Bitcoin fell about 3.3% to $ 41,311, and prices near $ 41,000 could act as good support levels.



"You're seeing a day where you're seeing a lot of assets being hit: commodities, as well as stocks, as well as bonds -- and of course, crypto," said JJ Kinahan, chief market strategist at TD Ameritrade. "Many people see it as a riskier asset, so I'm not surprised to see it down along with so many other things today," he added.

Now, it is important to keep a close eye on $ 40,000, as any significant break below this level will cause some traders to downgrade their positions in the short term.

But the situation may change in October, especially since six of the last 10 years have been positive for Bitcoin. Past data said it gains an average of 13% during October.





Andrey Shevchenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of BTC/USD for September 29, 2021

Crypto Industry News:
High-performance computing company Northern Data has announced that it has acquired the Bitfield bitcoin mine. According to the press release, all major shareholders have signed a binding agreement to buy the entire Bitfield business worth approximately $ 460 million. Under the agreement, Northern Data will acquire 86% to 100% of Bitfield shares.

Northern Data claims it has become a "leading global Bitcoin mining company" with the acquisition, giving it immediate access to 6,600 operational ASIC miners. By the beginning of the second quarter of 2022, an additional 26,000 new miners are expected to be deployed primarily in Canada and the United States.

"With this acquisition, we are adding BTC mining to our three existing companies - bitcoin hosting and services, altcoin mining and cloud computing," said Aroosh Thillainathan, Founder and CEO of Northern Data AG.

Northern Data Management expects revenues to be approximately $ 210 million to $ 260 million in 2021.

Bitcoin mining difficulty has increased in the past 2 months, from an annual low of 85 million terahashes per second (TH / s) on July 3, to a local high of 140 million TH / s on July 21. The total hashing rate of the Bitcoin network at the time of this writing was 136 million.

After China's initial attacks on Bitcoin mining, the difficulty of BTC mining decreased as Chinese miners left the network, while the recent spike in hash rate proves miners are returning to the network.


Technical Market Outlook
The BTC/USD pair has hit the level of $40,635, which is the key short-term technical support for the bulls and bounced towards the nearest technical resistance seen at $43,159. The key technical support located at the level of $39,526 is getting closer as the momentum remains weak and negative. The market keeps making lower highs and lower lows as it trades under the trend line resistance as well.

Weekly Pivot Points:
WR3 - $55,572
WR2 - $51,601
WR1 - $47,548

Weekly Pivot - $43,366
WS1 - $39,311
WS2 - $35,303
WS3 - $31,312


Trading Outlook:
According to the long-term charts 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 29, 2021

Crypto Industry News:
BeePool, the fourth largest Ethereum mining pool by computing power in the world, will suspend all of its mining services from October 15, the company said on Tuesday.

The Chinese mining pool has suspended new user registrations and new auxiliary accounts for existing users, according to an announcement on the BeePool official website.

The company said it was holding its services due to regulatory and compliance concerns over last week's crackdown by the Chinese government. The People's Bank of China, the country's central bank, has stepped up its crackdown on cryptocurrencies by announcing illegal cryptocurrency transactions.

The move came shortly after SparkPool, another leading China-based Ethereum mine operator, based in China, announced it would cease operations on September 30, citing similar reasons.

Mining Ethereum's margins have been widened by a cryptocurrency boom, a deflationary impact on its price from a recent technical upgrade, and a higher gas surcharge driven by the NFT boom.

Some miners quietly resumed Ethereum mining operations in China after it was banned by the State Council in May.


Technical Market Outlook
The ETH/USD pair is approaching the technical support seen at the level of $2,728. The nearest technical resistance is seen at the level of $2,980 and $3,052. The momentum is negative and bears are back in control of the market. The last week low located at the level of $2,639 might be tested soon is the bearish pressure prevails. Please notice the weak and negative momentum supports the short-term bearish outlook.

Weekly Pivot Points:
WR3 - $4,157
WR2 - $3,675
WR1 - $3,440

Weekly Pivot - $3,036
WS1 - $2,728
WS2 - $2,316
WS3 - $2,003


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 close below the technical support at the level of $2,906. 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

[IFX_Selena]

Ethereum 50% retracement level continues to hold

Ethereum moves sideways in the short term but the bias remains bearish. The crypto found a strong support zone, a demand area, so a temporary rebound is natural. The price of Bitcoin tries to come back higher, so the altcoins could start increasing as well.

ETH/USD is up by 0.12% in the last 24 hours and by 0.09% in the last 7 days. The price action develops a triangle pattern that could bring us great opportunities. Bitcoin's growth after printing a bullish engulfing on the 40,904 static support could attract more buyers on ETH/USD as well.


ETH/USD PRINTS A TRIANGLE PATTERN!


Ethereum failed to stabilize under the 50% retracement level signaling a strong demand zone. It moves sideways after its failure to reach the median line (ml) or the lower median line (lml) of the ascending pitchfork.

Personally, I believe that only a valid breakdown below the lower median line (lml) and through the weekly S1 (2693.46) could really activate a larger downwards movement. On the contrary, ETH/USD may develop a strong swing higher only after making a valid breakout from the down channel pattern.

It's premature to talk about a long or a short opportunity as long as the crypto moves sideways.


ETHEREUM PREDICTION!
A larger corrective phase will be activated by a valid breakdown below the lower median line (lml) and under the S1 (2,693.46). This scenario could signal potential drops towards the weekly S2 (2,323) and down to the channel's downside line.





Ralph Shedler
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin [BTC/USD] challenges dynamic obstacle! Long or short?

Bitcoin moves somehow sideways in the short term being undecided. It remains to see what will really happen as the crypto stands above a strong demand zone. The pressure remains high in the short term, so won't be a surprise if BTC/USD drops deeper.

In the last 24 hours, the price of Bitcoin is down by 2.56%, while in the last 7 days it's still up by 0.40%. BTC/USD is into a support zone, so anything could happen. Personally, I'll wait for a fresh opportunity before taking action. A bullish pattern could bring long signals, while a new lower low may activate a larger corrective phase.


BITCOIN AT CROSSROADS!


It has failed to stay above the 38.2% retracement level and above the weekly pivot point (43,361.66) indicating strong pressure. In addition, its failure to come back to reach the downtrend line shows that the sellers are very strong.

Now it's pressuring the ascending pitchfork's lower median line (lml) and the 50% retracement level. The 40,192.90 stands as static support. Personally, I believe that only dropping and closing below this level may really activate a larger downside movement.


BITCOIN OUTLOOK!
BTC/USD's failure to reach the ascending pitchfork's median line (ml) signaled massive bearish pressure and potential drops towards the lower median line (lml). Only a valid breakout above the immediate downtrend line may invalidate a downside continuation.

Personally, I believe that a bearish closure below the weekly S1 (39,419) could confirm a larger drop towards 35,000 or down to 32,000 psychological levels.





Ralph Shedler
Analytical expert of InstaForex
© 2007-2021