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Eyes Lows Seen Ahead of Libra Rally
BTC: Price: $8,300 | MCAP: $150.40 billion | 24-Hr Volume: $29 billion
Short-term trend: Bearish
Bitcoin on Tuesday dived out of a three-month contracting triangle pattern, confirming an end of the rally from April's lows near $4,000 and opening the doors for a slide to $7,500 – lows seen before Libra hype gripped the market in mid-June.
Supporting the bearish case is the fact that the breakdown was backed by a surge in trading volumes to the highest level since June 27, as per Bitstamp data.
Also, BTC has found acceptance below the three-day chart 55-candle exponential moving average, which served as a strong base during the 2016-2017 bull market.
All-in-all, the path of least resistance is to the downside and the outlook would turn bullish if prices quickly rise above Tuesday’s high of $9,782, although that looks unlikely at press time.
Long-term trend: Teasing bearish reversal
Bitcoin is currently reporting a 13 percent drop on a month-to-date basis. The price drop marks a negative follow-through to the consecutive inside bar candles created in the previous two months.
An inside bar is considered an early warning of an impending bearish reversal if it appears following a notable price rise. BTC created inside bars in July and August, having rallied from $4,000 to $13,880 in the preceding three months.
The bullish-to-bearish trend change, however, would be confirmed only if prices end below $9,097 (first inside bar’s low) on Sept. 30. That looks likely with prices currently trading at $8,400 and the daily chart reporting a strong bearish setup.
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Chainlink Holds But Not For Long
LINK: Price: $0.20 | MCAP: $650.4 million | 24-Hr Volume: $3.1 million
Short-term trend: Bearish
LINK is one of the few crypto within the top 100 at CoinMarketCap residing in the green today after bitcoin's bearish breakdown from a descending triangle, dragged the entire market down.
The 28-day channel has been ranging between $2.06 and $1.64 since August 28 and will provide greater scope for continuation should a solid close below $1.50 or above $2.10 occur by month's end. Long-term trend: Neutral
While the market structure has produced a series of lower highs since its massive sell-off on June 29, prices have found a foothold near a prior consolidation zone, throwing into contention the long-term trend. As previously mentioned above, a firm close below $1.50 would provide greater clarity moving forward as buyers look to exit amid defined bearish market conditions for the remainder of 2019.
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Algorand Heads Lower
ALGO: Price: $0.20 | MCAP: $79.7 million | 24-Hr Volume: $53.1 million
Short-term trend: Bearish
The crypto markets have not fared well over the last 24-hours as bitcoin dragged altcoins lower forcing many traders to close out their long positions in a brutal long squeeze.
ALGO was no exception, falling x percent on the day and being one of the worst performers in the top 100 at CoinMarketCap with a heavy downtrend opening up further possibilities for another leg down. Their is potential for a short-term bounce, courtesy of the oversold conditions illustrated by daily RSI, but given recent events, the bounce could be short-lived. Long-term trend: Bearish
The 6-hour chart shows a deeper drop of the histogram bars on the awesome oscillator (AO) adding to the bearish bias long-term until a reversal is marked with a green bar move above 0. Algo's price action would switch bullish with a move above the 6-hour 55 exponential moving average located at $0.31. Until then conditions are significantly in favor of sellers.
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Bitcoin fell from $9,500 to $7,998 in the two hours to 20:00 UTC on Tuesday. The price drop was preceded by a sell-off in the US stocks, as tweeted by Mati Greenspan, Senior Market Analyst @eToro.
For instance, the Dow Jones Industrial Average (DJIA) tanked from 27,037 to levels below 26,700 approximately two hours before the top cryptocurrency began losing altitude.
Bitcoin seldom takes cues from traditional markets like stocks, bonds, etc and is largely an uncorrelated asset.
Even so, many believe BTC is an effective hedge against global fiat and banking system and is considered as digital gold or a safe haven asset.
However, the fact that bitcoin's price sell-off was preceded by a slide in the DJIA indicates that there is little or no haven demand for the cryptocurrency.
Moreover, participation of traditional investors in the cryptocurrency markets is still low. So, despite being deflationary and having a solid anti-establishment appeal, the cryptocurrency rarely benefits from the risk aversion in the stock markets. |
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| Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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