Cryptocurrency Analysis

[IFX_Selena]

Bitcoin downside could be over soon

Bitcoin has started to grow again after finding strong support. The price turned to the upside but we still need strong confirmation before considering going long. In the short term, the bearish pressure remains high, so a minor drop or a sideways movement is somehow expected after the current rally.

BTC/USD has increased by 9.36% from 53,308.93 yesterday's low to 58,298.06 today's high. Personally, I would like to see a minor consolidation before jumping higher. The rate needs strong consolidation before developing a new leg higher.


BTC/USD THROWBACK!


Bitcoin has found support below the decending pitchfork's median line (ml) and under the 50% retracement level and now it challenges the 38.2% retracement level. In the short term, it could could move sideways between the 50% (54,322.83) retracemet level and the 59,953.74 levels.

Technically, the median line (ml) stands as a dynamic support, On the other hand, the descending pitchfork's upper median line (uml) is seen as a dynamic resistance. Making a valid breakout through the upper median line could announce a strong swing higher.

BTC/USD OUTLOOK!

58,933 - 59,953 stands as a strong resistance area. As long as it stays below it and under the upper median line (uml), we cannot talk about a larger growth. A sideways movement followed by a valid breakout through these upside obstacles could really announce an upside continuation towards fresh new highs.

A minor consolidation above the weekly pivot point of 56,718.35 may announce further growth towards the mentioned resistance levels.






Ralph Shedler
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Ethereum accumulates more bullish energy


Ethereum rallied after registering a new false breakdown below the 4,000 psychological level. It has appreciated by 10.33% from 3,965 yesterday's low to 4,374 today's high. The crypto started to increase again as the price of Bitcoin has turned to the upside.

In the short term, ETH/USD is trading sideways, the price action signaled that the downside is over. Still, the price stands below strong dynamic resistance, only a valid breakout through it may signal a larger growth.


ETH/USD EXTENDS ITS SIDEWAYS MOVEMENT!



Technically, ETH/USD has found support again below the 38.2% (4,025.21) retracement level. It has failed to approach and reach the descending pitchfork's lower median line (LML) signaling a strong upside pressure.

The upper median line (UML) stands as a dynamic resistance. You can see that the price movement was stalled by this upside obstacle. Stabilizing above the weekly pivot point (4,257) followed by a valid breakout above the upper median line (UML) could activate an upside continuation.


ETH/USD FORECAST!

Jumping, closing, and stabilizing above the upper median line (UML), a valid breakout could announce potential further growth towards the 4,868.79 all-time high. Its failure to reach the former lows or to stabilize below the 4,000 psychological level signaled that the corrective phase is over.





Ralph Shedler
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin: Waiting for an Impulse? Catch BTCUSD at 52,000


Black Friday suddenly turned into a red Friday for the cryptocurrency market. Bitcoin very skillfully bounced off the resistance of the 55,842.84 - 59,283.67 corridor and broke through its support. Now catch BTCUSD at $52,000 per coin.

What became the catalyst and how dangerous it is for the crypto market?


AFRICAN STRAIN OF CORONAVIRUS OR THIN MARKET?

Markets were shocked by the news of the discovery of a new African strain of coronavirus on Friday. It is distinguished by a large number of still unexplored mutations, as well as a higher propagation rate.

Stock and commodity markets collapsed. Does this mean that bitcoin, followed by other cryptocurrencies, also collapsed amid the flight from risk? Perhaps.

But here, I think, it was not without the effect of a thin market due to the weekend in the United States. I'm not sure if this works the same on cryptocurrency exchanges as it does on the stock exchange, but I won't completely rule out the impact.


IS IT WORTH BUYING BACK THE FALL?

Analysts point out that Bitcoin could fall 20% from record highs and this is a great opportunity to "buy back the fall." For large market participants, it may be so, but for private traders, this is clearly not the best opportunity. Catching falling knives in the middle of the range is very risky for a small capital.

But when it will be possible to consider purchases, it is when the price reverses in the area of $52,000 per coin. The nearest support zone is visible there. I think the price may stop here. However, it is not necessary to open deals before a clear reversal is formed. It's such a time now where anything can happen locally.


BLOOMBERG CLAIMS BITCOIN IS "BEARISH"

While some are recommending buybacks, popular trader and podcast host Scott Melker warned against following the crowd expecting to buy out even lower levels.

Funding rates on exchanges are a sign that sales are likely not over yet. They are still high despite the 24-hour liquidation volume approaching $700 million.

Melker also drew attention to an unusual correlation between the US dollar and bitcoin. He believes, as already noted above, that this is due to the impetus given to the market by fears around the virus.

Experts usually argue that Bitcoin tends to be inversely correlated with the US dollar, which, incidentally, collapsed on Friday against a basket of currencies.

However, now bitcoin has fallen along with the dollar index markets - the correlation (if any) turned out to be direct. There is a strange escape from risk.


OR IS IT JUST BLACK FRIDAY?

Nevertheless, a similar trend was already observed when at the end of November 2020, Bitcoin fell to about $16,400, but then recovered and for the first time in three years crossed the level of $20,000 per coin.

So maybe not everything is so critical yet. At least, in my opinion, there is no need to panic until the area near $52,000 per bitcoin is broken.

Meanwhile, other analysts argue that a heavy block of support in the form of buyers' positions at $53,000 stands in the way of further losses of BTCUSD. This is roughly the area that corresponds to Bitcoin's $1 trillion market cap.








Ekaterina Kiseleva
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Ethereum vs Solana: why SOL becomes more attractive than Ethereum, and ETH becomes a coin for the rich?

The Ether ecosystem has recently become the main source of the coin's price growth thanks to the explosive growth of the DeFi and NFT sectors. However, as of November 2021, the altcoin has no visible competitors, and many potential "ETH killers" did not compete and dropped out of the race for the decentralized finance sector. Despite this, the Solana token is able to compete with ether due to the speed and cost of transactions, as well as the good pace of development of the blockchain.

All these processes are taking place against the backdrop of the formation of ETH as a full-fledged second power in the cryptocurrency market. Following the status, the main altcoin loses many of the advantages of its previous status, such as low transactions and network availability for all categories of users. In theory, this means that part of the ETH 1.0 audience will be looking for an alternative, and an excellent way out of the situation would be to switch to SOL. However, first of all, let us consider in what way the broadcast has become not as accessible as before.

A clear example of the growth of the ETH network was the statement of the Director of BlockFi, who announced that the company will no longer provide services for the free withdrawal of the main altcoin. The reason for this decision is the significantly increased transaction costs. In other words, fees on the Ethereum network have skyrocketed, and even the London update failed to address the issue. Now, for the first withdrawal of funds from the platform, you will have to pay a commission of 0.015 ETH, which is $64. A similar situation occurs on many decentralized platforms based on ether.



Ultimately, this will lead to an outflow of audience from ETH-based projects and the search for more profitable alternatives. The developers will follow the preferences of the audience, and it is likely that the main altcoin will lose part of its audience. I note right away that there is no need to worry since the increased deflationary component of the coin will allow it to attract much more institutional investment.

Altcoin Solana can become an effective alternative to ETH, since it consumes a minimum amount of energy, and, accordingly, the fees on the network are much lower. An illustrative example was provided by the project developers, according to which one transaction on the altcoin network consumes less energy than 2 Google searches.

For example, at the moment, ETH consumes 644 million Joules, while SOL is only 1,836 Joules. The situation is likely to change with the transition to the ETH 2.0 version, but Solana's competitiveness is striking and as of November 2021, this altcoin is a profitable alternative to ETH.



To top it off, the architecture of the Solana project allows smart contracts to process many more transactions in a shorter time frame and at a lower cost. In the near future, we can expect a change in the ratio of the number of projects and the cost of blocked funds in DeFi projects based on ETH and SOL.

Analyzing the possibility of such a trend, it is worth emphasizing that as ether has surpassed bitcoin in terms of growth, so Solana can surpass ether. Technically, the potential of the coin is in no way inferior to ETH.





Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading signal for Ethereum (ETH) on November 26 - 29, 2021: buy above $4,062 (5/8)



In the last hours, Ethereum (ETH) has lost more than 12% due to risk aversion on the part of investors and the increase in panic regarding a new variant of Covid.

According to the 4-hour chart, it can be seen that Ethereum is consolidating around the psychological level of $ 4,000. It is likely that in the next few hours, there is a technical bounce towards the 21 SMA located at 4,277.

Around the 21 SMA will be a good opportunity to sell ETH targeting 4,039 to 4/8 murray at 3,750.

On the other hand, if Ethereum consolidates below the key level of 3,900, we could see acceleration of the downward movement towards the pivot point of 3,750.

After breaking the uptrend channel on November 15, Ether has been testing this resistance more than 3 times. Because it failed to break, it is now retreating and it is a sign that in the short term we could see a drop to the level of 3,500.

Considering the bearish outlook for BTC, the price of Ethereum is expected to follow the same trend and fall to the demand zone around 3,750.

Our trading plan for the next few hours is to sell in case of a pullback to 21 SMA (4,277) with targets at 4,065 and up to 3,750. On the contrary, if it consolidates above the 21 SMA at 4,300, we can buy with targets towards 4,687 (7/8).


Support and Resistance Levels for November 26 - 29, 2021
Resistance (3) 4,596
Resistance (2) 4,327
Resistance (1) 4,159

Support (1) 4,062
Support (2) 3,750
Support (3) 3,542


A trading tip for ETH November 26 - 29, 2021
Buy above 4,062 (5/8) with take profit at 4,277 (200 EMA), stop loss below 3,920.






Dimitrios Zappas
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

XRPUSD breaks below support.


In previous posts we noted the bearish pattern in XRPUSD as it had formed a descending triangle pattern. Price was respecting the support around the $1 price level. However the bounces where getting weaker and weaker.



Blue rectangle- support

Red line -resistance

XRPUSD is trading around $0.95 after making a low around $0.90. Price is in a bearish trend as price continues making lower highs and new lower lows. We have warned bulls that as long as price was below $1.13-$1.25, XRPUSD would remain vulnerable to a move towards $0.85-$0.80. Yesterday highs are where the key short-term resistance is found, so bulls will need to break above $1.05-$1.065 in order to change trend to bullish.






Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for November 26, 2021

Crypto Industry News:
Economist Paul Beaudry, who is also deputy president of the Bank of Canada, believes that cryptocurrencies do not pose a threat to the economy at the moment. Paul Beaudry's position contrasts with a recent statement by the former US Secretary of State: Hillary Clinton sees cryptocurrencies as a threat.

No wonder that Canada was not only one of the first countries to approve the Bitcoin ETF, but also ranks fourth when it comes to the hash rate of the BTC network.

The deputy president of the Canadian central bank spoke about cryptocurrencies during the Ontario Securities Commission Dialogue 2021. The economist focused primarily on discussing threats that could affect the stability of the Canadian financial system.

Of course, there was a question about cryptocurrencies, to which Beaudry replied that, according to the Bank of Canada, cryptocurrencies do not develop in a way that could pose a threat to the financial system:

"Developing in a way that creates a systemic type of risk for a financial system".

Among other things, Beaudry's position was argued that cryptocurrencies were sidelined from the main financial system. With time, however, with the increasing capital influencing the crypto market and the increase in the number of people using digital assets, the risk will increase, which is why the bank closely monitors the cryptocurrency market and stablecoins.


Technical Market Outlook
The ETH/USD pair has retrace 61% of the last wave down and then sharply reversed lower again as the bearish pressure intensify. The next target for bears is seen the level of $4,021 and any violation of this level would accelerate the down move towards the key short-term technical support seen at $3,954. Please notice, that the larger time frame trend remains up and there is no indication of the trend reversal yet.

Weekly Pivot Points:
WR3 - $5,566
WR2 - $5,159
WR1 - $4,752

Weekly Pivot - $4,357
WS1 - $3,938
WS2 - $3,564
WS3 - $3,134


Trading Outlook:
The next long-term target for ETH is seen at the level of $5,000. 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. The level of $3,677 is the key mid-term technical support for bulls.







Sebastian Seliga
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of BTC/USD for November 26, 2021

Crypto Industry News:
The regulatory framework for digital content planned by the European Union is moving forward. On Wednesday, the European Council, which steers the EU's political agenda, announced its position on Markets in Crypto Assets (MiCA) and the Digital Operational Resilience Act (DORA).

After an agreement that must then be ratified, the European Council and Parliament can now start discussing the initiative before it is finally approved as law.

The MiCA framework is designed to protect investors and consumers from fraud, including guarantees that investors' money is safe in the event of hack. If authorities consider that certain virtual currency exchange platforms pose a risk to investors or users, they may impose more stringent rules on them under MiCA.

The European Central Bank said the new rules would establish comparable cultural standards for payment service providers to guarantee user safety. According to a recent ECB communication, the framework will also contain provisions on corporate governance and risk management, as well as prohibitions on the provision of services such as high-risk payment instruments.

The MiCA European Council document, which is over 400 pages long, suggests that the EU will not soften its stance on asset-backed token issuers. It also says that they should be subject to stricter obligations than the issuers of other crypto assets.


Technical Market Outlook
The BTC/USD pair has broken below the recent bottom of the wave 3, which is located at the level of $55,758. The new, marginal lower low was made at the level of $54,888 (at the time of writing the article). The nearest technical resistance is seen at the level of $57,740 and the local technical support at $53,747. The momentum remains weak and negative despite the potential low of the wave 3/C as the bearish pressure intensify. Only a sustained breakout above the level of $62,767 would change the outlook to more bullish.

Weekly Pivot Points:
WR3 - $75,582
WR2 - $70,896
WR1 - $64,654

Weekly Pivot - $60,209
WS1 - $54,112
WS2 - $49,298
WS3 - $43,190


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. This scenario is valid as long as the level of $52,943 is clearly broken on the daily time frame chart (daily candle close below $52,000).








Sebastian Seliga
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Ethereum false breakout & bearish engulfing


Ethereum is dropping like a rock at the time of writing. It's trading at 4,389.77 far below 4,556.42 yesterday's high. In the short term, it has reached a strong dynamic resistance, so a temporary decline was somehow expected.

ETH/USD dropped by 3.75% from 4,555.25 today's high to 4,383.99 today's low. The crypto drops as the price of Bitcoin turned to the downside. Ethereum could test and retest the near-term support levels before trying to jump higher.


ETH/USD TEMPORARY DECLINE!


ETH/USD registered a false breakout through the descending pitchfork's upper median line (UML) and now it has turned to the downside. The bearish engulfing signaled a potential drop.

Now, it challenges the weekly pivot of 4,331.69 and the 23.6% retracement level. Unfortunately, it has failed to stabilize above 4,439.92 signaling that the pressure is high. The median line (ML) of the descending pitchfrok stands as a dynamic support.

Only a valid breakout through the upper median line (UML) could announce an upside continuation.


ETH/USD FORECAST!

Dropping and stabilizing under the descending pitchfork's median line (ML) could signal a deeper drop towards the 38.2% retracement level. A larger corrective phase could be activated by a valid breakdown below the 38.2% and under the 4,000 psychological level.

On the other hand, staying above the median line (ML), testing and retesting this dynamic support, or registering only a false breakdown could signal that ETH/USD could still grow.






Ralph Shedler
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Cryptocurrency market update for November 26, 2021



BTC'S 2ND FAILED ATTEMPT TO BREAK THROUGH $56,361 BARRIER

On Thursday, November 25, Bitcoin rose by $1,500 after its second failed attempt to break through the $56,361 barrier (76.4% Fibonacci level). It is a very important mark. A breakout there is likely to trigger a deeper correction. According to Glassnode analysts, many long-term investors keep buying out all available BTC volumes on exchanges, preventing the rate to go down. So far, it has been an accurate assumption since the price failed to fall below the abovementioned point. So, there is a likelihood that the current uptrend structure will become more complex. At the same time, the asset failed to break through the barrier twice in two days. This could indicate the completion of the first wave of the new uptrend.


IMF CALLS ON EL SALVADOR TO RE-EVALUATE ITS DECISION ON BITCOIN

As a reminder, El Salvador adopted BTC as legal tender. It was reported that the county is now planning to build the world's first Bitcoin city with no taxes other than the VAT. El Salvador's President Nayib Bukele intends to raise about $1 billion through the placement of Bitcoin bonds. Half of these funds will be used for building the city. It is difficult to say who would want to live in El Salvador, albeit in a city without taxes. Nevertheless, this is a very interesting idea. However, not everyone finds it appealing. The International Monetary Fund called on El Salvador's government to re-evaluate the decision to make BTC legal tender. According to the Fund, the country's authorities are not fully aware of all the financial and consumer risks related to cryptocurrency. They reminded the El Salvador government of bitcoin's high volatility and offered to limit the area of the use of the digital asset as well as tighten cryptocurrency regulation.

Meanwhile, JPMorgan said ether is better than bitcoin for long-term investments because it is less dependent on fundamental factors. ETH has surged 6 times since the beginning of the year compared to BTC that only doubled gains.



The current uptrend structure still looks clear. The wave layout cleared up after the instrument went above the high of supposed Wave 3. On the chart, there is now an impulsive 5-wave structure that began to form on July 20. However, in the last two weeks, the price has been pulling back from the highs, meaning that Wave 5 is about to complete soon. This wave will look shorter if Bitcoin breaks the $56,361 barrier successfully. Otherwise, Wave 4 could split into three smaller ones and Wave 5 could start to form with targets at about $74,000. If so, the price will continue to decline within the first wave of a new downtrend section. The formation of this section could be completed in 1-2 months. Meanwhile, BTC will be heading towards $45,000.





Chin Zhao
Analytical expert of InstaForex
© 2007-2021