Cryptocurrency Analysis

[IFX_Selena]

Crypto enthusiasts turn to technical indicators for clues



Amid another hectic day in the market, crypto enthusiasts are turning to technical indicators for clues as to where bitcoin and ether might go.

Having lost about 20% since reaching its all-time high earlier this month, bitcoin was traded below the 50-day moving average. Many crypto market players consider it to be a bearish move. Meanwhile, ether failed to settle above its 50-day moving average on Wednesday and closed below it at the end of the trading day.



According to senior commodity strategist for Bloomberg Intelligence Mike McGlone, the second-largest token encountered good tech support at $4,000. "It seems like a battle with the long leveraged from the higher levels being flushed out and the longer-term, more institutional supply below the market," he said. McGlone sees ether consolidating its bull run in the $4,000 to $5,000 range.

Cryptocurrencies have sold in recent days amid a number of concerns including BTC and ETH seeing their largest options expiry date for 5 months on November 26, increased regulatory risks as well as many tokens that have risen rapidly in a short period of time.

News that India is preparing legislation to regulate cryptocurrencies appears to be behind the final stage of bitcoin sell-off on Wednesday on exchanges popular with Indian investors. At some point, bitcoin plunged nearly 14% on WazirX but little changed elsewhere.

Some analysts also cite decreasing risk appetite in the broader stock market where profitless tech companies have suffered from the declines.

"We see bitcoin losing value when we see a sell-off in the more speculative parts of the equity market," Chief Market Strategist at National Securities Art Hogan said.

As a result, BTC dropped by 3.1% to $55,908 on Wednesday, while ETH fell by 4.2% to $4,168.

According to Matt Maley, Chief Market Strategist for Miller Tabak + Co., both ETH and BTC have been traded around their lows since the previous week: "These lows – $ 55,500 on XBT and $ 4,000 on XET – are the most important short- long-term support levels".

Katie Stockton, founder and managing partner of Fairlead Strategies, notes that despite the fact that bitcoin has pulled back sharply within its medium-term uptrend, it is showing signs of short-term downside exhaustion according to a number of indicators. On top of that, BTC is now oversold, which increases the likelihood that it reached the bottom.

"We expect bitcoin to resume its medium-term uptrend, eventually allowing it to break through resistance near $65,000 for a projected long-term measured movement of $90,000," Stockton said.






Andrey Shevchenko
Analytical expert of InstaForex
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