Bitcoin / US Dollar
The major headline during the last days in the crypto world was the ban from the Chinese government on mining facilities for Bitcoin and Ethereum. This announcement had an immediate and severe effect on Bitcoin’s price as it dropped from $36,000 to $30,000 in just two days. As the market had entered a compression status of around $36,000, a fundamental change made the market change its route and head towards the new price, according to investors’ expectations.
The Chinese ban means that the rest of the miners in the Bitcoin network would be in higher chances to solve the mining problems and win the blocks. Taking into consideration that Chinese companies had around 65 % of the total hash rate power in the network, we believe that the mining market has shuffled the cards again in the game, allowing existing and new players to get into better positioning.
Making Bitcoin easier to obtain through the mining process, made investors think that the fundamental value might need to decrease and the market corrected just below $30,000. From this moment and on, the market has taken an uptrend towards recovery, reaching today $34,000. The major point that will bring the market back to the previous status, will be $36,000, as the market will claim the previous compression point and start again from this point.
We expect that this kind of recovery will complete in the next few days as things are normalized in the mining industry. The trading volumes made a spike during the last days, showing the sell-off and the recovery process had a severe impact on the trading process. The moving averages formed another reverse “Golden Cross”, predicting a change in the market mood again, towards the negative side.
In the short-term diagram, we can observe that moves like the Monday sell-off were not uncommon in the short-term past, as similar moves had become evident on the positive side, making the price jump from $33,000 to $37,000 or from $35,000 to $39,000 in just a day. We expect that this could happen this time also.
Indicators
MACD index passed on the negative side, predicting a bearish set of events in the upcoming days while the RSI index moved above value = 40, indicating that the market will probably remain on the same price levels but with a negative outlook.
Ethereum / US Dollar
The correction was also evident in the Ethereum market, as the price dropped almost 20 % during the last few days, from $2,500 to $1,900. The break from the compression trend around $2,500 made Ethereum get down in the zone below $2,000. The $2,000 point was the most crucial point for the bullish phase in the last year, as Ethereum’s price made huge jumps and made many investors happy about its progress.
As the price recovered today at $2,000, the next step for the recovery in the market will be the $2,500 point as the market will fill the space and get back in the compression zone. The support levels held strong and we expect that the recovery will take its path along with Bitcoin and other markets.
The trading volumes made a spike during the last two days, indicating that many investors were afraid of the situation. The moving averages have remained at a bearish position, bringing more negativity in the market formation.
Indicators
MACD index has remained in the negative area, predicting that a change in the market momentum will be slower than expected. The RSI index moved to values between 35 and 40, indicating that the market might move into another downtrend before starting to recover.
Ripple / US Dollar
Ripple has experienced a steep correction during the last weeks, falling from $1.00 (the major compression and return point) to $0.55, marking a 45 % correction. The correction became more intense, once the entire market made the move out of the compression zone
As the correction deepens more and more, it would become more difficult for the market to recover and bring back the previous price levels above $1.00. This projection would be hard to become a reality as investors are losing faith in the market and explore different opportunities in the crypto market. The recovery found Ripple to be at $0.63, setting off a new round of potential stability in the market.
We expect that the market will try to catch the previous price levels but with a slower adaptation of the established trend and its direction. Additionally, the zone between $0.60 and $1.00 is an unexplored area for Ripple and every move will be tracked with proximity. The trading volumes saw no difference in the last period while the moving averages have sustained a bearish position, creating negative vibes in the market.
Indicators
MACD index passed on the negative side, confirming the bearish mood in the market while the RSI index moved to value = 35, after touching the “oversold” area, indicating that the downtrend was over and we expect a new bullish move in the future.
Litecoin / US Dollar
Another coin that experienced severe correction was Litecoin as it dropped from $170 to $130 in the last few days. The correction reached 25 %, making the price hit the lower limit for the compression trend. This support level is crucial for the upcoming price development as the bottom will establish the end of the bearish correction.
The recovery won’t be easy for Litecoin as the market dynamics have not enough power to bring the bulls back in the market. We expect that the price will try to recover in the next period according to the market’s trend, setting the first goal at $170 and a second one at $200.
The trading volumes were particularly high during the last two days, showing that the investors were panicked and tried to sell as many coins as possible. The moving averages have been close enough, in bearish positioning, making us look closer in the market formation.
Indicators
MACD index passed on the negative side, showing that the market will try more to change the momentum at this moment. The RSI index moved to value = 35, after hitting the bottom, meaning that the market has started to recover at higher price levels.
Bitcoin Cash / US Dollar
A continuous descending move is obvious in the Bitcoin Cash market, as the price moved from $650 to $450, breaking a major support level at $550. The $550 point was established as a steady point from the previous period and its break means that the recovery in the market will be much harder than before.
The first step for the recovery will be the $550 comeback and the slow evolution towards $700, which was the major compression point. We expect that Bitcoin Cash will follow its previous tradition: heavy losses and sudden shining in the rain with profits. This scenario could rephrase as that the coin might remain stable for a long period before hitting a higher level and create profits for the investors.
The trading volumes made a small spike, showing that investors didn’t make any extreme moves by replacing capital in the market. The moving averages have sustained a bearish position, predicting a further downtrend in the market.
Indicators
MACD index passed on the negative area, showing that the market momentum has turned and the market could find it hard to recover. The RSI index moved to value = 35, after hitting the “oversold” area, meaning that the recovery has just started.
Correlations
Bitcoin / Ethereum = 0.56 (+ 0.09), Bitcoin / Ripple = 0.60 (+ 0.12), Bitcoin / Litecoin = 0.76 (+ 0.13), Bitcoin / Bitcoin Cash = 0.66 (+ 0.23)
The market moves seem to be quite coordinated from one perspective, indicating that Bitcoin and its dynamics will affect every aspect of the market, providing a steady line about future moves in the markets and their predictability. Even if, the moves seem to be in the same direction, the pace for each coin is different and this is depicted in the correlation field. Every crypto asset has climbed in the medium correlation zone, indicating that every move in the Bitcoin market will bring new actions in the rest of the market, establishing a further interconnection between them.
Key Notes For Today
- Bitcoin started its recovery, reaching $34,000
- Ethereum has touched its major point at $2,000
- Ripple had the most severe correction, touching $0.55 and recovering at $0.63
- Litecoin moved in the lower limit of the compression trend, at $130
- Bitcoin Cash broke down at $470, breaking the $550 support level
