Cryptocurrency Analysis

[IFX_Selena]

Wave analysis of BTC/USD for December 6, 2021


BTCUSD, H1:


It is assumed that after the completion of a large upward impulse wave (A), a new corrective pattern has begun to form for BTCUSD. A simple zigzag may be forming, which will consist of subwaves [A]-[B]-[C].

The price decline in wave [A] has recently ended. It took the form of a simple five-wave impulse, which is marked with blue subwaves (1)-(2)-(3)-(4)-(5).

Now we see an upward price movement. Most likely, we are at the beginning of an upward corrective wave [B]. Perhaps it will take the form of a simple zigzag (A)-(B)-(C), where (A) is the initial diagonal. A rough outline of possible future movement is shown in the chart.

The entire wave [B] is likely to complete at the level of 58,410. At this price level, the value of wave [B] will be 61.8% of the impulse [A].

In this situation, it is possible to consider opening buy deals from the current level in order to take profit at 58,410.00.

Trading tip: buy from the current level, take profit at 58,410.00.





Roman Onegin
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Crypto Winter Canceled: Bitcoin Collapsed Due to Whale Manipulation After Collecting Liquidity


The weekend turned out to be truly winter for the cryptocurrency market. In less than 5 hours, Bitcoin made one of the largest falls in the current year. The price of the asset dropped 20%, reaching an alarming mark at $42,000. The cryptocurrency market has followed BTC and updated the local low over the past three months. The Fear and Greed Index instantly moved into the "extreme fear" area, and there was talk of the beginning of the crypto winter.



Liquidations as a result of the fall amounted to $2.3 billion, which is one of the largest falls of 2021. About $950 million were liquidations of transactions paired with Bitcoin and $563 million paired with Ethereum. Most of the liquidated positions were long, which indicates a lot of excitement around the likely growth of the cryptocurrency. This is where the main reason for the collapse lies, which, in my opinion, exceeded the expectations of the "whales."

Over the past two weeks, there has been an increased demand for longs among market players. However, at the same time, the futures market practically froze in place, while options set local demand highs. At the same time, BTC's on-chain activity remained at medium positions. This divergence could not be considered healthy and spoke of an overheated market.



The final chord of the fall was the long-term collection of liquidity from the range of $55,000-$59,000. The correction in this area was aggravated due to the manipulative actions of large capital, which, according to the data of Santiment and CryptoQuant, moved more than 15,000 BTC to the exchanges. Thus, the institutional investors fueled the interest of the rest of the Bitcoin audience and delayed the collection of liquidity.

When the market sentiment was as bullish as possible (expressed in a local record for the number of longs), institutional investors played against the mood of the crowd, which resulted in a powerful squiz. This can be seen in the All Exchanges Whale Ratio indicator, which shows that "whales" significantly profited from the fall of the first cryptocurrency.



However, I assume that the final target of large capital was the $49,000-$53,000 area, and the further fall in price was caused by panic moods in the market. However, the fall turned out to be more serious, due to which the trend line from $40,000 was merged.

As of December 6, the bulls managed to buy back the fall, thanks to which the weekly candle closed near $50,000. But the price drop still looks significant and in the next few days, we should expect price stabilization and sideways movement in the range of $46,000-$49,000.

On the daily chart, we see that Bitcoin has made a powerful impulse movement to the level of $41,890. Subsequently, buyers managed to make a powerful buyback, thanks to which the candle closed above $49,000. However, after that, an uncertain green Doji candle was formed on the chart, which indicated the weakness of buyers.

As we can see, the fall further worsened, and the price broke through the Fibo level of 0.236, which is a bearish sign.

Taking into account the fact that Bitcoin continues to trade below $48.200, where the Fibo level of 0.236 passes, I believe that we will be able to form a double or even triple bottom below $45,000. This scenario is canceled if the cryptocurrency manages to go beyond $48,000 in the next few days, and ideally gain a foothold above $50,000.



I assume a scenario in which the price will be able to recover above $50,000, but subsequently, fall below $45,000 again. This assumption is based on the manipulative capabilities of large investors who broke the main jackpot by lowering the price below $58,000 positions, where a large number of orders are concentrated. A similar option is possible here, as below $45,000, the 365 EMA passes at $44,800, where a powerful support zone passes. If the "whales" want to collect liquidity there, then we should expect the formation of a double bottom.





Artem Petrenko
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin weekend crash is the start or not?


Bitcoin crashed to $41,600 over the weekend. Support at $53,000 failed to hold and our short-term bullish scenario got cancelled. In our weekly analysis last week we also warned that the bigger picture was worrying and a pull back towards $49,000 and $44,000 was possible.



Red lines - Fibonacci retracements

Bitcoin broke the 38% Fibonacci retracement support level and sharply moved towards the 61.8% level and lower. This decline does not cancel any longer-term trend. The upward move from $29,000 was completed at recent all time highs around $68,959. Price has so far retraced more than 61.8% and this higher low could be a major low under formation. It is important therefore for bulls to manage to hold above $40,000. Failure to do so will be a sign of weakness and we should cancel even a new lower low below $29,000.






Alexandros Yfantis
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading plan for Bitcoin for December 06, 2021



TECHNICAL OUTLOOK:
Bitcoin has extended its drop beyond $53,000, which we expected earlier. Nonetheless, the crypto has bounced from around $41,000-42,000 levels over the weekend. Please note that it is close to the Fibonacci 0.618 retracement of its recent upswing between $40,000 and $69,000 levels. A bullish turn would still keep the structure intact, going forward.

Bitcoin has broken below its channel line support but found support around the Fibonacci retracement. Bulls might be looking poised to come back in control from here ($45,000-46,000) zone. If successful, Bitcoin would be on its way toward all-time highs above $70,000 mark in the next few weeks. A break above $60,000 from here will confirm the same.

Bitcoin faces initial resistance at $60,000 mark, while support comes in around $40,000 mark respectively. A slip to $40,000 will negate the bullish scenario as bears will be inclined to drag further towards $28,000 mark.


TRADING PLAN:
Potential rally toward $70,000 against $40,000.

Good luck!






Oscar Ton
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Gloomy Monday or the saga of why Bitcoin never shows good results on Monday



Bitcoin declined by about 5% today after a hard weekend, where it showed no signs of growth. There is almost no liquidity at all on weekends, so this cryptocurrency is most vulnerable to collapse, and Monday becomes the X-day for it.

The digital gold has lost almost 20% of its value. After such a sharp fall, it has fewer and fewer prerequisites for new growth.

The last catalyst for demand and interest in Bitcoin was the purchase of 7002 bitcoins by Microstrategy.

Investors are confident that such a sharp pullback from its historical high is associated with the departure of institutions from highly volatile assets to traditional markets, due to fears of the Omicron coronavirus.

These concerns, together with low trading liquidity, tend to manifest themselves on weekends. Matt Dibb of Stock funds, a Singapore-based crypto distributor, believes that the entire fourth quarter of this year will be a tough bearish month.

It will be difficult for Bitcoin to return to its historical highs and break through the resistance level of $69,000.

Prices continued to fall over the weekend, and investors who bought Bitcoins with a margin watched the situation when exchanges closed long positions, which became the catalyst for rapid sales.

On Saturday, many exchanges closed long positions on bitcoin worth more than $ 2 billion. Some exchanges allow traders to open positions more than 20 times the size of investments, which leads to the fact that even a slight movement in the wrong direction can serve as a catalyst for exchanges to begin liquidating customer positions.

Ben Caselin, an analyst at the cryptocurrency exchange, said that liquidity has fallen significantly due to the fact that major traders are relocating bitcoins from exchanges to cold wallets.






Vitaly Kolesnikov
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Technical Analysis of ETH/USD for December 6, 2021

Crypto Industry News:
Researchers from an Australian university have questioned Bitcoin's reputation as the best means of custody, saying Ethereum is on track to "become the world's first deflationary currency."

A November 18 article by four Australian scientists discusses how the Ethereum Improvement Proposal (EIP) 1559 update makes ETH a potentially better means of hoarding. The study was co-authored by Ester Felez-Vinas from the University of Technology Sydney, Sean Foley from Macquarie University, Jonathan Karlsen from the University of Western Australia and Jiri Svec from the University of Sydney.

The EIP-1559 update saw the network burn some transaction fees and over 1 million ETH. Sometimes, the report says, EIP-1559 burns daily transaction fees of more than 50% of the 12,000 newly minted ETHs. The researchers believe that as the demand for Ethereum grows due to its robust ecosystem of decentralized financial applications, even more will be burned.

Scientists write that Ethereum is already less inflationary than Bitcoin:

"Analyzing the rate of Ethereum formation since EIP-1559, the expected increase in total Ethereum supply is only 0.98%, which is less than half of the 1.99% increase in Bitcoin supply, which is almost certain over the same period," we read.

The researchers concluded that Ether provides "better anti-inflation properties than Bitcoin, and therefore Ethereum may offer better long-term storage of value than Bitcoin."


Technical Market Outlook
The sell-off on the ETH/USD had been terminated at the level of $3,438, so the bears had manage to push the price way below the $4,000 level. After the Pin Bar candlestick was made at the daily time frame chart, the bounce from the lows has hit the level of $4,257 and now the market is consolidating in a narrow range. The next technical resistance is located at $4.435. The immediate technical support is seen at $4,055. Despite the recent complex and time consuming corrective decline in form of ABCxABC pattern, the larger time frame trend remains up.

Weekly Pivot Points:
WR3 - $6,154
WR2 - $5,472
WR1 - $4,817

Weekly Pivot - $4,100
WS1 - $3,475
WS2 - $2,785
WS3 - $2,131


Trading Outlook:
The ABCxABC complex corrective cycle might be terminated, so 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 December 6, 2021

Crypto Industry News:
According to local media reports, the Indian government will not be asking for a total ban on cryptocurrencies, but will instead regulate the sector.

On November 23, the media reported that the Indian government is considering a bill proposing the creation of an official digital currency, while imposing a ban on all "private" cryptocurrencies.

The news triggered a panic sell-off on the local cryptocurrency exchange the next day. The unclear wording of the law and the lack of explanations from the government led many observers to share the prospects for cryptocurrencies in India.

Indian news service NDTV said it had obtained details of a cabinet memo circulating in the government regarding the proposed cryptocurrency law. It turned out that the note made suggestions for regulating cryptocurrencies as crypto assets, and the Securities and Exchange Council of India (SEBI) oversees the regulation of local crypto exchanges.

Investors will be given a certain amount of time to declare their cryptocurrency holdings and transfer them to SEBI-regulated exchanges, suggesting that private wallets may be banned. This, he added, was part of the government's insistence on preventing money laundering and terrorist financing. The government will halt its plans for the Central Bank's Digital Currency (CBDC) with the Reserve Bank of India (RBI) while its focus is on the cryptocurrency sector. It will not allow any crypto assets to be recognized as currency or legal tender.


Technical Market Outlook
The vicious sell-off on the BTC/USD had been terminated at the level of $41,678, so the bears had manage to push the price almost towards the $40k level. The immediate bounce from this level has hit the level of $49,702 at its best and now the market is consolidating in a narrow range. The next technical resistance is located at $50,456 and $52,333. The immediate technical support is seen at $46,719. Despite the recent complex and time consuming corrective decline in form of ABCxABCxABC pattern, the larger time frame trend remains up.

Weekly Pivot Points:
WR3 - $75,308
WR2 - $67,229
WR1 - $57,614

Weekly Pivot - $49,717
WS1 - $40,054
WS2 - $31,972
WS3 - $22,000


Trading Outlook:
The ABCxABCxABC complex corrective cycle might be terminated at the level of $41,678 and the market is ready to continue the up trend. According to the long-term charts the bulls are still in control of the Bitcoin market 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 $39,474 is clearly broken on the daily time frame chart (daily candle close below $39,000 would be considered as a long-term trend change due to the lower low placement).








Sebastian Seliga
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Trading signal for BITCOIN (BTC) on December 06 - 07, 2021: sell in case of pullback at 50,500 (200 EMA)

On December 4, BTC fell to the low of 41,642, this was the price level of September 30. The price ptinted a loss of more than 22% in a single day. This is the biggest drop since May 15, when BTC traded around 30,000.

The cryptocurrency market was overwhelmed by a general panic and the bullish positions worth of more than 2.5 billion USD were liquidated. BTC is now expected to consolidate below the psychological level of 50,000.

In our analysis of December 2, we noted a shoulder head shoulder formation. This pattern reached its target when BTC fell to the low of 41,640. You can review the full report here and get some details of this strategy.



According to the daily chart, BTC is now below the 21 SMA and below the 200 EMA. This provides a negative signal so that BTC could continue its decline to the psychological level of 40,000.

If BTC consolidates above 51,500 in the next few days, there could be a recovery to the resistance zone of the 21 SMA located at 56,278.

On the contrary, while BTC remains below the psychological level, it is expected to trade within a price range between 50,000 - 43,750.

On December 4, the eagle indicator reached the level of 5 points which represents an imminent technical rebound. Therefore, if BTC falls to the support of 43,750 in the next few hours, it will be a good buying opportunity around this level.

Our trading plan is to wait for a pullback through the 200 EMA at 50,000. At this level, it will be a good opportunity to sell with targets at 43,750 (-1/8) and up to the -2/8 of Murray located at 37,500.


Support and Resistance Levels for December 06 - 07, 2021
Resistance (3) 51,949
Resistance (2) 50,820
Resistance (1) 50,000

Support (1) 46,898
Support (2) 43,750
Support (3) 40,812


A trading tip for BTC on December 06 - 07, 2021
Sell in case of a pullback at 50,500 (200 EMA) with take profit at 43,750 (+1/8) and 37,500 (-2/8), stop loss above 51,600.






Dimitrios Zappas
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin Options Will Be the Key to New All-Time Highs for Digital Gold



The world's leading investment company Goldman Sachs is confident that the development of cryptocurrency options will be an important catalyst for the growth of cryptocurrency, as traditional financial investors very often come to the crypto market.

Bitcoin desperately needs a developed options market. Goldman Sachs analysts are confident that there is an increased demand for Bitcoin options among institutional investors.

Top analysts of the company are confident that there is an increased demand for hedging with financial derivatives, and the next important landmark event that will raise Bitcoin in price will be the development of the options market.

At the moment, the demand for the bitcoin market is truly colossal. Data from analytical crypto site Skew, which monitors the derivatives market, shows that the total outstanding contracts for Bitcoin options are over $12 billion.

Last year, this figure was six times less and amounted to only $2 billion.

Traders are truly interested in trading futures and options instead of rebalancing their portfolios.

Options trading allows traders to hedge different types of investments over the long term.

Institutional investors tend to choose this trading option to hedge against potential risks, and also use this trading instrument to maximize their influence on the market.

This trade is also often referred to as derivatives trading. Over the past day, the price of bitcoin has increased by 0.3%, the volume of digital gold trading has fallen by 10%.






Vitaly Kolesnikov
Analytical expert of InstaForex
© 2007-2021

[IFX_Selena]

Bitcoin: How The SEC Is Hindering Innovation In The Crypto Industry


Discontent with the actions of the Securities and Exchange Commission (SEC) and its head Gary Gensler seems to be brewing among the participants of the cryptocurrency market.

Fidelity Investments, the largest asset manager in the United States, has launched its first bitcoin spot ETF in Canada on Wednesday as the SEC continues to reject applications for spot funds.


CRYPTO INDUSTRY VS GENSLER
The crypto community claims that the Commission, under Gensler's leadership, is performing its function of "protecting investors" in a very strange way.

For example, it seems rather suspicious that Gensler gave the green light to bitcoin futures ETFs instead of spot ones. It could of course be argued that the futures ETF only caters to large institutions and is definitely not suitable for small retail investors.

However, this futures instrument can be used to short Bitcoin. Experts suggest that this is the real reason why these particular tools were chosen. They can be used to manipulate the price of bitcoin.

On Friday, another application for the spot BTC-ETF, this time from WisdomTree, was rejected. Jake Chervinsky, head of policy for industry lobbyist The Blockchain Association, commented on the rejection:

"I wonder how long before one of the spot bitcoin ETF sponsors gets sick of arguing with a brick wall and decides to sue the SEC. I get why nobody did this before, but the case is stronger now with futures ETFs live, and the incentive to play nice is much weaker."


HOW GENSLER PROTECTS INVESTORS FROM FRAUD AND STIFLES INNOVATION
Gensler this week said the SEC would "use a coercive tool" against exchanges. He noted that even highly regulated exchanges like Kraken and FTX are not regulated as securities exchanges.

With so many coercive warnings and a long-held belief that virtually all of the crypto industry is violating securities law, the SEC has been holding back the most innovative technologies since the Internet.

For the SEC, the purported investor defender, struggling to bring cryptocurrency down is an absolute contradiction. Experts note that the current monetary system works completely against small investors. It is simply wrong to use the rules and regulations of this system for an innovative and disruptive system like cryptocurrency.


CRYPTOCURRENCIES ARE HOLDING ON WITH ALL THEIR MIGHT
Bitcoin, meanwhile, very accurately and clearly works out the boundaries of the narrow sideways 55,842.84 - 59,283.67. But one cannot say that his support will not be broken.

Therefore, the forecast for BTCUSD remains the same: consolidation in the 55,842.84 - 59,283.67 corridor or its expansion to the support area of $52,000 - $53,000 per coin.








Ekaterina Kiseleva
Analytical expert of InstaForex
© 2007-2021