Bitcoin / US Dollar
Price Analysis
Bitcoin's price broke the small, parallel channels created last weeks, leading to a bearish trend, reaching this weekend $9,000. Although this could lead to a major bearish trend in the future, the price hasn't get out from the large parallel channel between $10,000 and $8,600. The parallel move is in the market from early-May, closing around 2 months in that situation. The parallel moves for the price is often a volatility predictor, indicating that the price will move in a sharp way in any direction.
The uncertainty of the future direction is a common topic in crypto trading but we could highlight some features that may reduce the risk on the market. The $8,600 support level has been tested several times, showing that bullish investors are not willing to withdraw their positions and let their investments go. There is also an internal support level at $9,200, which may break in the last days but there is a severe possibility for the price to return back, according to the volume.
We expect the bearish trend to continue until the $8,600 support level and then bounce back to the parallel channel.
In the short-term diagram, the bearish trend is far more obvious. The last week was devastating for short -- term traders who took long positions as the price went from $9,700 to $9,000. This bearish trend was a tremendous opportunity for bearish investors, who were able to capitalize on the volatility and gain profits from that. There is also a possibility that the trend may reverse and return back to the smaller, parallel channels.
Indicators
MACD index continued its negative turn, leading to more separation between the two lines. The momentum in the market is considered really low while the RSI index stands in the "waiting" zone, between 40 and 60, showing that there is no clear signal for any future move in the Bitcoin price. Given that, indicators create a smog for Bitcoin's future and we have to wait for another, clearer signal.
Ethereum / US Dollar
Price Analysis
As we mentioned in the previous article, Ethereum broke the $230 support level and was trying to create a bearish trend in the market. The support levels at $220 stopped the downtrend, showing that the Ethereum market has enough depth to absorb any sudden changes that could lead to sudden liquidations.
The market depth is showing that Ethereum's investors have created sufficient positions in the market to sustain them in cases of a downtrend. The depth in the market is created when many investors are willing to expand their positions at a certain price level, where they believe there is a price in the market, much lower than the fair price. At this point, they enter the market or increase their position in the asset, posing a stop loss in the opposite direction.
Multiple levels of those entrances create support levels in the market and lead to greater stability and greater possibilities for a future uptrend. The expectations are another part of behavioural finance that we are going to examine in future articles.
Indicators
MACD index's composites seem to strive away from each other, creating a larger gap between the possibility of positive momentum in the market. The negative momentum, combined with the uncertainty derived from the RSI index, shows that the market is yet unable to find a certain direction, which will shape the near future. Mention that the RSI index moved towards value = 40, but it rebounds over the weekend, creating further uncertainty and no signals.
XRP / US Dollar
Price Analysis
XRP continued the bearish trend, breaking the lower boundary of the parallel channel. The breaking and the trend follow the bending curve, starting from mid-March until today. The parabola created since mid-March shows that XRP made a cycle that will probably end with another bottom, near its previous low.
This was the third negative breaking during June. There were two smaller parallel channels, when the price was compressed so much that broke negatively and now there was the larger parallel channel, creating bearish thoughts in any investor's mind.
In XRP's case, we should highlight the Moving Averages of 50 and 200 days, which may give some significant signals during our analysis period. From March to June, there are 6 cases of a cross between those moving averages, leading to bullish and bearish signals. The last signal was given around June 14, a bearish signal that indicates the price will drop from $0.185 to lower prices. Up to this moment, the signal is considered right so we have to wait for another signal that might work this time in the opposite direction.
Indicators
MACD index is moving even deeper in the negative zone, showing that XRP has no nerve to reverse the current situation in the market, leading to the observed bearish situation. On the other hand, the RSI index shows that XRP is almost oversold, a signal for bullish positions to take place in the next days. A further drop in XRP's price will create bargains in the market and it's quite possible for several investors to take the chance and place their bets on the bullish side.
Litecoin / US Dollar
Price Analysis
Litecoin didn't break the lower boundary of the parallel channel, showing that the support levels (even the moving one) is working and can save the market. The lower boundary at this point was staying around $41. The bearish trend is not so evitable as in other cryptocurrencies but we have to admit that Litecoin is moving much more slowly regarding its reactions to the entire market moves. We expect a stable move over the next days, which possibly will follow the rest of the crypto market on the bearish side.
The cross between the moving averages of 50 and 200 days was 6, from March to June. Even though Litecoin was not much volatile as other cryptos, the signals from moving averages crosses were sufficient enough for creating profits for the investors, following this strategy. The last signal appeared on June 14, a bearish one at $44, which is proved right by now, where the price is around $41.
Indicators
MACD index is on the negative side during the entire June, a fact that may change, given that Litecoin can move more abstract from the entire market due to its unique nature. In parallel, the RSI index moved below value -= 40, showing that there is a potential downtrend in the following days that will lead to a future pump from the oversold signal. In any case, we should stand by, waiting for a more sure signal in this market.
Bitcoin Cash / US Dollar
Price Analysis
Bitcoin Cash broke the lower boundary of the parallel channel at $220 but it immediately returns to the boundaries. This shows that Bitcoin Cash has a sufficient market depth that allows investors to expand their positions when the price drops. When the price drops are common in the bullish investors to expand their positions, following a dollar-cost average strategy. This means that when the price drops, most bullish investors place more money on the bullish side, expecting a future uptrend that will pay off their investments.
Regarding the moving averages cross, there 6 cases when this happened between March and June. The last observed signal appeared on June 14 at$ 238, proven right as the current price lays around $220. The moving averages and their crosses are a common method for many traders and analysts to observe and quantify the momentum on the market. We can observe that the signals are right quite often, leading us to the conclusion that a relevant strategy might be efficient and profitable.
Indicators
MACD index is compressed for the last months showing no clear direction for an established bullish or bearish trend. This can be observed also in the RSI index, which moved between value = 40 and value = 60. Over the last days, we can observe that the index moved below value = 40, which indicates a possible downturn until the moment when an oversold signal will appear and reverse the market momentum upside down.
Correlations
The correlation coefficients remained high during the weekend, changing just a little bit in a positive direction. All correlation coefficients are above 0.90, showing a strong and statistically important relationship between Bitcoin's price's movements and the other cryptocurrencies. This shows that Bitcoin is the dominant asset in the crypto market, affecting every other asset and plays an important role in their moves. That's why every crypto price analysis should start with Bitcoin and should analyze its effect on other cryptocurrencies. That's also a reminder for every trader that wants to analyze any crypto market or asset.
