It has been an eventful week in the crypto world and that’s why this week, our weekly analysis won’t be concerned only by one article that has come out. As you can see from the graph below, there are plenty of bad news that could tip the uptrend to the correction. The most important ones are the news that the DragonEx had been hacked, and rummors that Coinbene has been hacked. Even these two news could at this point be enough to tip the price in the other direction. On top of that Twitch has removed option to pay in cryptocurrencies and one of the prominent exchanges Bitwise alerted SEC that 95% volume on the cryptocurrency exchanges is fake. On the other hand, adoption of cryptocurrencies grows as the number of confirmed transactions is the highest in the past 12 months and as Wuabit’s digital wallet plans to allow WhatsApp users to transfer Bitcoin via chat. In our perspective, the negative news are right now more actual than the positive ones, because market generally tends to react quicker to news such as hacked exchange than to the news such as the highest number of confirmed transactions. News about hacks are usually spread around the crypto-sphere in the matters of seconds, while the latter takes time for market participants to realize.
If you have followed our last analysis, you were expecting a fall to the upper border of the pattern. As the pattern held its structure and because of how cryptocurrency market works, it was very likely that we will still bounce up from that point, which is exactly what happened. Now, there are as always two scenarios that can play out, and this time I have decided to leave the decision on where the market is going to go, on you. Intend of the green and red horizontal lines is therefore to give you areas where it would be smart to take some profits, or to buy back. You can notice that red lines are close to each other and the reason is to provide targets for those of you who will short this movement. For those of you, who plan to sell and simply buy back, don’t worry. Until we reach the bottom, there will be a new analysis clarifying our assumption on where that will be. The green lines are obviously a bullish targets and red lines are targets for those of you who are more inclined to the bearish scenario. Now since we have the important properties explained, lets get to the analysis for you to have something to base your position on. Let’s first look at the RSI line. If we draw a line connecting the previous top with our supposed recent one, we can notice that if the first trend line gets violated, we could see a run up to the RSI trend line above it. Though chances are that this final touch of the upper trend line would happen around the similar time as the 150 day MA touch. 150 day MA has so far held as a overhang resistance through out the entire bear season. That’s why if you personally believe that we are beginning an intermediate bear phase, this first touch wouldn’t be an exception, and touch of the MA would mean a sell signal. Another bearish scenario is that we won’t even touch the upper RSI trend line and neither the MA. In that case, price would reverse around now, or around the level of the previous market top, at the first green horizontal line. If we look at the bullish scenario, then we have just bounced off of daily bottom RSI trend line and the first difficulties that bulls will have will be at first green target. If the green target is surpassed, the price might very likely reach the level of the 150 day MA. If that one gets penetrated by the bulls and if it further on holds as a support, it would mean that bulls have gained an upper hand over the bears and suggest that we are outside the bearish woods. To us, this scenario seems less likely, because that would require huge conviction on the bulls side. Right now, they have a lot to loose if bears are still waiting for the right time to strike. With that said, our intermediate position remains bearish, though if the 150 day MA gets penetrated and holds as a support, we would change our bearish stance to the bullish one. With everything that has been said, you can now decide whether to sell or whether to buy. If your believe that we will be heading lower, consider selling now, around the first green target or around the touch of the 150 day MA. If you believe that we are gonna continue in this bullish rallie, you know what areas to be beware of and what kind of price confirmation is needed in order to continue to the next bullish target. It might be a relieve to you to know that volume is the highest since the 2017 top, meaning that in the long term, we might already be in the sideways action, which could lead to the new long term bull market. Meanwhile, beware of the bears, because they might be hiding, waiting to take profits from those, who believe that the way up is a one way path.
Articles for those of you who want to dig deeper: https://go.daneel.io/news?s=list-of-top-mainstream-companies-that-dropped-support-for-bitcoin-cryptocurrencies&fbclid=IwAR0sLdAXmLrjBhtYGCh_Dw6w3m6G8hiyLxnnCEcqGgISsL1yzcennOl50j0
https://go.daneel.io/news?s=bitcoin-exchange-coinbene-swears-it-wasn-t-hacked-traders-fear-the-worst&fbclid=IwAR3q6TwMINW4AHkIozPZx4DZaOq9YkoszuHQP_mWGi8QY85tgMHwswtn7_E
https://go.daneel.io/news?s=wuabit-s-digital-wallet-to-allow-whatsapp-users-to-transfer-bitcoin-btc-via-chat-say-reports&fbclid=IwAR1txSBZJlS6WAfrxHJoX-WVLex3xKzqtq1jVo0egAsKCsckWYUtNUbSf6s
https://go.daneel.io/news?s=breaking-dragonex-hacked-exchange-reports-loss-of-customers-funds&fbclid=IwAR0Cw4tn2zHiD00aHv678Mg9l0ZuTIwZu0QfBVdR7YaZ6ai2BhhySG9mqSQ
https://go.daneel.io/news?s=twitch-removes-crypto-payment-without-any-prompts&fbclid=IwAR1QFzzL17-fy3AWVSRTyjfMzywTnuaCcGdvVDlv8ckL5osgIHA3M2Dbf3A
https://go.daneel.io/news?s=bitwise-tells-sec-that-exchanges-fake-95-of-crypto-volume&fbclid=IwAR33IubA6lor84rMiv15jnHkKTS09N8yQo3D7Q7cCbj-mo11twh7rMV3fW8