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Bitcoin Eyes Pre-Halving Gains
BTC: Price: $9,330 | MCAP: $168.23 Billion | 24-Hr Volume: $26.42 Billion
Short-term trend: Bullish
Bitcoin has violated a bearish lower highs setup on the hourly chart with a move above $9,245. Further, the cryptocurrency is teasing an upside break of a descending trendline on the 4-hour chart.
As a result, a re-test of the 100-day average at $9,606 could be in the offing. Note that BTC has failed three times in the last five days to hold on to gains above the long-term average. As a result, a UTC close above the 100-day MA could embolden bulls, leading to a sustained move above $10,000.
A possibility of a move all the way back to $10,350 cannot be ruled out as the recent pullback from that level was accompanied by a drop in trading volumes. A low-volume pullback is often short-lived.
In fact, BTC could rise well above $10,350 in November, as reward halving is due in May 2020. In the past, the cryptocurrency has picked up a strong bid six months ahead of the reward halving, as seen in the chart below.
Long-term trend: Bullish
Reward halving is likely to keep bitcoin better bid over the next few months. Historical data shows the cryptocurrency rallied from $5 to $16 during the six months leading up to the reward halving in May 2020.
Also, BTC jumped from $360 to $780 in the four months to mid-June 2016, before trimming gains and falling back to $465 in August, when the block reward was cut from 25 BTC to 12.5 BTC.
More importantly, BTC continued to scale new heights following the reward halving. The long-term bullish case The bullish case looks stronger if we take into account the strengthening narrative that the top cryptocurrency is a digital gold and a hedge against inflation.
Many observers believe the negatives interest rate era could force traditional investor to pour money into cryptocurrencies. After all, BTC is the best performing asset of 2019 and possibly of the decade.
Long-term technical studies are also biased bullish. For instance, the 100- and 200-period averages have produced a bullish crossover on the three-day chart. A similar bull cross in March 2016 was followed by a 21 month bull market.
The bullish view would be bolstered if and when prices exit the four-month falling channel seen on the weekly chart, confirming a resumption of the rally from lows near $4,000 seen in April.
That looks likely by the year's end, as the three-day chart MACD, which has a strong record of signaling big moves, has turned bullish for the first time in over three months.
Read Analysis
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Higher low Sets The Stage
IOST: Price: $0.0064 | MCAP: $77.3 million | 24-Hr Volume: $145.7 million
Short-term trend: Cautiously bullish
IOST's falling wedge breakout beginning Oct. 27 has met with strong resistance along prior supports near $0.0081, as evidenced by two topside wicks demonstrating stiff rejections on the daily chart.
However, the awesome oscillator (AO), a tool used to judge the momentum of a trend is flashing signs of greater buying power, coupled with a higher low daily candle offering respite during a period of consolidation that may provide another retest at resistance.
Closing below $0.061 aborts the bullish view of a lower high formation in the short-term.
Long-term trend: Bearish
Due to both Oct. 27 and Oct. 30 topside wicks, price action has been suppressed beneath prior supports, as mentioned above. Continuous rejections will likely lead to a further depreciation in IOST's price given the near overbought nature highlighted by the daily RSI.
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| Tron in Troubled Territory
TRX: Price: $0.020 | MCAP: $1.3 billion | 24-Hr Volume: $1.3 billion
Short-term trend: Bearish
The bullish rally that began Oct. 25 has been stopped dead in its tracks along the 200-day moving average (MA) despite a larger than average surge in trading volume.
Down 9.61 percent over a 24-hour period, TRX's price action dangles along temporary supports located between $0.019 and $0.020, a loss at this level will likely induce another sell-off to lower supports near $0.018 and $0.016.
It all depends on how today's candle closes as it is currently anaemic both in volume and size hinting at another sell-off proceeding Oct. 30's sharp drop.
Long-term trend: Bearish
TRX's long-term trend remains bearish below the 200-day MA, as it generally signals bullish price action when above and conversely bearish when below.
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The bitcoin options market has turned bullish with the cryptocurrency's recent rise from $7,500 to $10,300.
The call options (bullish bets) are now claiming higher volatility premium than put options (bearish bets) on Deribit exchange, according to Tony Steward (@PelionCap).
The data indicates increasing demand for call options, a sign the traders are anticipating further gains in the near term.
Had the skew – the measure of demand for puts over calls – remained bearish, it would have meant the traders are skeptical about the sustainability of recent gains and are hedging (by buying puts) against a potential bull trap.
Skews and risk reversals are often used to confirm market trends.
Call options are financial contracts that give the option buyer the right, but not the obligation, to buy the underlying asset at a specified price within a specific time period.
Put options are financial contracts that give the option buyer the right, but not the obligation, to sell the underlying asset at a specified price within a specific time period. |
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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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