Cryptocurrency Analysis

[IFX_Selena]

Wave analysis for BTC/USD on November 24, 2021




The development of a bearish zigzag can be observed in the last section of the chart. According to the rules, a simple zigzag consists of three sub-waves. The first sub-wave (A) currently looks fully done.

Wave (A) has the shape of an impulse and consists of five sub-waves of a smaller wave level 1-2-3-4-5. The final sub-wave 5 took the form of a finite diagonal.

At the moment, the price has reversed and is ready to move upward within the corrective wave (B). This correction may end around the level of 62255.00. The level was determined using the Fibonacci lines tool. At this price point, the correction size (B) will be 50% of the momentum (A). This is a common coefficient in zigzags.

Based on the current situation in the market, where growth is expected in the coming days, it is worth considering opening purchase transactions in order to take profit at the specified level.


Trading recommendations:
It is recommended to buy from the current level and take profit at 62255.00.





Roman Onegin
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Cryptocurrency in India under threat of ban



India is preparing a cryptocurrency regulation bill that will be considered in parliament at a meeting starting on November 29. Its contents remain unclear, but one of the reasons why the government raised it is to help the country's central bank create an official digital currency.

"The bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses," said Indian Prime Minister Narendra Modi.

India has had good and bad connections with digital currencies over the past few years, with the country effectively banning cryptocurrency transactions in 2018. The Supreme Court lifted this restriction in March 2020, but recently, there have been calls for stricter regulation as having little rules may push domestic household savings towards a new asset class.

Because of this, Bitcoin fell 12.2% on one of the leading crypto exchanges, Wazirx, since investors fear that the government will end up banning cryptocurrency trading after the bill is introduced to parliament next week. The decline was much sharper than the coin's 1.8% drop globally.

The Central Bank of India opposes private virtual currencies, and its governor, Shaktikanta Das said that the country needs much deeper discussions on the issue of cryptocurrencies.





Andrey Shevchenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for November 24, 2021

Crypto Industry News:
Total Blocked Value (TVL) in Ethereum's Tier 2 networks hit a new record as gas charges continue to rise, fueling further adoption. TVL across various protocols and Tier 2 networks hit a record $ 5.64 billion.

Second tier scaling solutions provide significantly higher transaction throughput and lower transaction fees, and their adoption increased significantly in November, where the highest average gas charges in the history of the Ethereum network were recorded.

Tier 2 TVL has more than doubled since early October, rising 110% from $ 2.68 billion to its current level. The average Ethereum transaction fees are currently around $ 40. They hit around $ 65 on November 9, and have risen 700% in the last four months.

Gas prices vary depending on the operation. A simple ERC-20 token transfer can currently cost around $ 45, while a more complex interaction with smart contracts or Uniswap swaps can cost as much as $ 140, according to Etherscan.

Registering a name with the Ethereum Name Service can cost hundreds of dollars on the gas, even though an actual domain name costs just a few dollars a year.

Since October, multi-chain-compatible decentralized financial platforms have seen record inflows as investors and developers try to avoid the Ethereum network due to rising gas charges.


Technical Market Outlook
The ETH/USD pair keeps consolidating in a narrow range after a bounce from the technical support located at $4,055. The market conditions on the H4 time frame chart are coming off the overbought conditions, so a deeper down move might occur, targeting the level of $4,021. 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 24, 2021

Crypto Industry News:
The Russian Federal Tax Service (FTS) is actively monitoring the cryptocurrency market to prevent tax evasion, said FTS chief Daniil Yegorov.

Cryptocurrencies have the potential to "significantly erode" the Russian tax base, Yegorov argued in an interview with local media on Monday.

However, cryptocurrency transactions are still traceable and should be reported, the official said, adding that the FTS is ready to implement automated tracking systems to process large amounts of data.

"When you enter the digital space, you still leave a mark. It is only a matter of time before this trace is identified" - Yegorov declared.

The official also noted that the FTS is now devising ways to respond to crypto tax evasion practices as authorities seek to limit such activity rather than just identify it.

The news comes shortly after the Bank of Russia proposed last week to introduce criminal liability for "illicit trade in digital financial assets" as part of the country's financial market targets for 2022 and 2023-2024. As part of the proposal, the central bank wants to establish a cryptocurrency taxation procedure.

The Russian State Duma approved the Cryptocurrency Taxation Act at first reading in February 2021, requiring residents to report crypto transactions totaling more than $ 7,800 per year. In order to proceed to the second reading, the legislator decided in mid-October to appoint a competent committee, ie the State Duma Committee on Budget and Taxes.


Technical Market Outlook
The BTC/USD pair is testing the bottom of the wave 3 again, which is located at the level of $55,758. The new, marginal lower low was made at the level of $55,333 during the test, but the whole H4 candle looks like a Pin Bar anyway. The momentum remains weak and negative despite the potential low of the wave 3/C, so any violation of the level of $55,785 would extend the correction towards the level of $55,747 or below. 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]

Cryptocurrency market update on November 24, 2021



BITCOIN CANNOT CONTINUE TO DECLINE BELOW THE LEVEL OF $56,361

Bitcoin rose slightly in value on Tuesday, November 23, failing for the second time to break through the $56,361 mark, which corresponds to 76.4% Fibonacci level. This unsuccessful attempt may cause a new increase in BTC quotes with targets located above the current peak of about $69,000.

Meanwhile, the news about El Salvador's plan to create the first "Bitcoin City" did not cause a new wave of purchases on Bitcoin. Therefore, I advise you to monitor the level of $56,361 in the coming days, as well as the wave counting, which, although not completely unambiguous at this time, can nevertheless help in forecasting. The breakdown of the $56,361 mark may indicate the readiness of the markets for Bitcoin sales and a drop in faith in its ability to grow in 2021, with only 5 weeks left until the end.

Recall that many cryptocurrency experts and analysts have repeatedly stated throughout 2021 that Bitcoin will grow to $100,000. There are only 5 weeks left for the execution of this option. And Bitcoin, of course, can show strong growth, but it is unlikely to be so strong that it will almost double in price in a little more than a month.


THERE ARE NO FUNDAMENTAL SIGNS OF COMPLETION OF THE UPWARD TREND

Many economists single out several points at once that may announce that it is time to get rid of Bitcoin since it will only fall further. Note that Bitcoin has not shown long periods of growth in its history (for example, 3-5 years). Usually, it grows for a year and a half, and then it is in the shade for about the same period. So experts believe that the fall of Bitcoin can be expected if inflation around the world begins to decline. This will lead to the fact that investors will stop looking for hedging tools. And one of these tools is Bitcoin.

Also, many economists single out such a factor as the tightening of monetary policy by the world's largest central banks, which will lead to an increase in the profitability of other, less risky investment instruments, such as deposits, bonds, stocks. Economists also do not rule out that the fall of Bitcoin may be due to the influx of coins to exchanges, which will mean high volumes of coin sales.

However, so far long-term investors are in no hurry to get rid of their coins. All of the above signs of the completion of the upward trend are also absent at present.



The current upward section of the trend still does not cause any doubts. The wave pattern was refined after the instrument made a successful attempt to break through the maximum of the assumed wave 3. Now the whole picture looks like an impulsive five-wave upward trend section, which began its construction on July 20.

However, the exit of quotes over the past two weeks from the reached highs may mean the end of the expected wave 5, which in this case will be shortened. At the moment, I'm leaning towards this option. Especially if Bitcoin successfully breaks through the $56,361 mark. If not, then wave 4 can still be recognized as a three-wave, after which the construction of the proposed wave 5 with targets located near the 74th figure can begin.

If the attempt is successful, the decline will continue within the first wave of a new downward trend segment, which may take at least a month or two to build. And Bitcoin at this time will strive for the $45,000 mark.





Chin Zhao
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin is unlikely to rise to $ 100,000 this year




A NEW CORRECTION HAS BEGUN, BUT IS IT A CORRECTION?

Bitcoin has started to decline steadily during the last few weeks. This is not a collapse, as the digital asset likes to do, but it is a steady drop in its quotes. The chart below clearly shows that Bitcoin's upward trend is maintained due to the ascending trend line. It lies approximately around the 61.8% Fibonacci level of $ 51,350. The Senkou Span B line is located slightly higher. Together, these two obstacles can provide serious support for Bitcoin. But at the same time, as usual, everything will depend on the mood of most major traders. So far, we expect that Bitcoin will drop by another 3-5 thousand dollars.

The factors of Bitcoin's decline can be banal to the point of horror.

The fundamental background for Bitcoin remains fairly neutral. After all, even if there is no important and high-profile news, market participants can still continue to invest in cryptocurrency. According to the latest data, about 22% of the adult population of the United States already owns Bitcoin or other cryptocurrencies. Therefore, whether we like it or not, this cryptocurrency is becoming more and more popular all over the world. Another thing is that it is still extremely rarely used for settlements or payments. It is still a highly profitable and high-risk instrument. Therefore, most of the news related to Bitcoin pursues only one goal – to create as much hype as possible and make it more expensive even more.

For example, the authorities of El Salvador decided to create the world's first "Bitcoin-city", whose residents will be completely exempt from taxes and decided to attract a billion dollars for this project by issuing bonds. In fact, the project is very interesting, but now, it is vital for the whole country that Bitcoin grows in price. Naturally, as in the case of large investors, forecasts from El Salvador about the future price of Bitcoin will come only optimistic. It can be recalled that for most of 2021, many experts were talking about Bitcoin at $ 100,000 per coin by the end of the year. There were forecasts of $400,000 next year. However, it shows that they are not destined to come true yet. Although Bitcoin has updated its annual and absolute highs, it is not much, and now, it is "aiming" at a new "bearish" trend.

Moreover, there is a "bubble" problem for the cryptocurrency market as well. It should be remembered that the entire last "bullish" trend occurred at a time when the Fed was pumping the economy with free money. In this case, this growth is "inflationary", simply due to the fact that there was more money in the economy, which means random. Now that the Fed has embarked on the path of tightening monetary policy, an outflow of capital may begin from the cryptocurrency market, which will lead to a serious drop in BTC.



The upward trend remains on the daily timeframe. If Bitcoin manages to rebound from the Senkou Span B line or trend line, then the current trend will continue, and the cryptocurrency will be able to count on a new round of growth and update its absolute highs. However, we believe that this is the beginning of the end. The breakdown of the trend line can create a strong signal to change the trend to a downward one.






Paolo Greco
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin: BTC is not performing well enough yet, and is not a protective haven that protects against inflation



Bitcoin is having a tough week right now, the cryptocurrency is in a state of correction and has already lost more than $10,000 from its historical peak.

The current correlation coefficient of digital gold and the S&P 500 is 0.3, which is a record for the year. Bitcoin also continues to grow if the stock shows an upward movement.

The coefficient (1) means that stocks and bitcoin are moving synchronously, and (-1) means that assets are moving in different directions.

Many crypto enthusiasts believe that digital assets and bitcoin are very closely related and are a special protective class that can act against inflation.

Many high-tech companies suffered heavy losses at the beginning of the week. On Monday, companies with a very high price in the field of high technology suffered losses, including companies whose growth expectations were pushed into the future.

Bitcoin is losing almost 7% during Monday's session, and in two weeks digital gold has fallen by almost 20%. Today, prices have stabilized, while the digital token has gained about 2%, to 57,455 US dollars.

Many Wall Street analysts have supported the use of bitcoin as a hedge asset against this trend.

Bloomberg Economics economists have stated in their latest calculations that about half of bitcoin's recent earnings can be attributed to investor fears, fears of impending large-scale inflation, and the other half to the abundance of the market and dynamic trading.

However, many analysts believe that bitcoin has not existed long enough, and has not proven itself to be a dominant asset that protects against inflation.

Duke University professor Cam Harvey is sure that bitcoin is like a speculative and highly volatile asset that is subject to periodic failures.

Many bitcoin movements depend on various short-term factors. It is very difficult to predict what could be the catalyst for bitcoin's growth, inflation or technological progress.






Vitaly Kolesnikov
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin and Ethereum: Correction is not a hindrance for investors



Investors are not worried about the corrective move in Bitcoin, which is about 19% from the peak. Based on the weekly report on the actions of institutional investors, there is a cash inflow between November 15-19 in the amount of $154 million. The lion's share of the total volume was absorbed by Bitcoin - $114 million. Ethereum received an inflow of funds in the amount of $14 million, while ETH absorbed approximately $80 million from the piggy bank of institutional investors in 4 weeks.

As for new blockchains, investors prefer Solana, which saw an inflow of investments amounting to $43 million over the past month.

Based on the data obtained above, one can see a positive attitude among professional market participants, given that it lasts more than 1 year.

Let me remind you that the head of MicroStrategy predicted a similar trend towards digital assets back in the fall of 2020, saying that other private firms would follow the example in the next six months.

Now, news that companies, funds, institutional investors have acquired X-volume of digital assets comes on a weekly basis.


Example

The mobile software and blockchain company Phunware (PHUN), which is listed on the Nasdaq exchange, has increased its Bitcoin investment by 398 BTC (approximately $23.8 million at an average price of $59,917). News from November 22.

A similar trend for digital assets will remain on the market for a long time, so it is still very early to store Bitcoin.


WHAT IS HAPPENING ON BITCOIN AND ETHEREUM TRADING CHARTS?

Between November 10 and November 23, the Bitcoin exchange rate dropped by more than $13,000, it may seem that we are dealing with a collapse, but this is not so. Analyze the trading chart from the end of July to the current day, you will see an upward trend, where the existing decline is considered a clock component of the trend.

Thus, the chance of further growth is high, market participants are focused on this, who view the correction as an opportunity to build up a portfolio with digital assets.


Expectations and prospects

The corrective move will soon be completed, the maximum deviation of the rate at the current moment is possible up to the psychological level of $50,000. The recovery of the BTC value is likely to be inertial, as it happened earlier in history. The local maximum in the face of the value of $69,000, most likely, will not become an obstacle for buyers, therefore, it will be broken when prices converge. The strongest level may well be the value of $70,000.

The medium-term perspective, as before, considers the strengthening of Bitcoin towards the level of $100,000.

As for Ethereum, the correction over the same period was about 18.5%. The area of the psychological level of $4,000 serves as a pivot point, relative to which there was a reduction in the volume of short positions.

In this situation, a stepwise upward move is considered; the strongest signal to buy ETH will come from the market when the price is holding above $4,500.

The price development prospect is still considering a $5000 = 1 ETH forecast.



The index of emotions (aka fear and greed) of the crypto market is at the level of 33 points, which is justified due to the corrective move. Based on the dynamics of the index, there is a convergence with the area of a possible change in trade interests. Thus, expectations of an increase in the value of digital assets may soon be confirmed in the market.









Gven Podolsky
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Ethereum respects 38% Fibonacci level.


Ethereum made another pull back towards the first key short-term Fibonacci support level at $4,000. Price has respected once again the support area and formed a higher low. Price is bouncing higher again from this Fibonacci retracement.



Black lines - Fibonacci retracements

Ethereum bulls must continue to respect the 38% Fibonacci level. Breaking below this level will open the way for a move towards $3,500. So as long as price is above yesterday's lows, bulls have the upper hand. Price must now break the resistance at $4,430 in order to continue towards the all time highs around $4,850. Ethereum price exited the bullish channel and is in a pull back phase. My most probable scenario is for price eventually to break below $4,000 and at least test $3,500.






Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

BTC analysis for November 23,.2021 - Potential for the another drop

Technical Analysis:



BTC has been trading downside as I expected. There is the potential for the further downside continuation.


Trading recommendation:

Due to strong downside cycle in last 20 days, I see potential for the downside continuation.

Watch for selling opportunities on the rallies with the downside objective at the price of $53,411.

Stochastic is showing another fresh bear cross, which is sign for the downside continuation.

Resistance level is set at the price of $60,000





Petar Jacimovic
Analytical expert of InstaForex
© 2007-2021