- BTC is looking bearish. How BTC reacts to the bearish indicators will shape the rest of its year. If BTC can hold onto the $11300 USD support levels until the indicators turn bullish then we should see BTC reach ATHs again before the end of the year. However if BTC fails to hold onto this level then we will likely see BTC fall all the way back down to $10500 or even $10000 USD in the coming weeks. (at the time of writing, 3-9-2020)
- SUSHI is a very new cryptocurrency and is one of the latest DeFi craze coins. Its TA is displaying that a potential breakout could be about to occur.
- LTC has been one of the worst performing major cryptocurrencies since the March meltdown as shown below with a BTC and ETH comparison.
- NEO has been very strong recently rising from $12 to $20 USD over the course of a month, an increase of 80%! Whether this will continue, however, is somewhat in doubt; it will depend on NEOs ability to use the BBs 20 day MA support line.
- LEND is currently showing a bearish descending triangle formation, this is due to there being a negative break below the triangle by the candles.
- EOS: We are currently fast approaching the neckline. If this is broken below then a fall towards $2.6 USD and then $2.4 USD will very likely happen. A drop towards $2.4 USD would result in a 16% loss from our current position.
- XRP has support at $0.245 USD and with XRP one of the older cryptocurrencies this support has more historical relevance which is why if the potential sell off occurs XRP should be one of the better performing cryptocurrencies.
- QTUM has performed very well since March, however as demonstrated below QTUMs bullish trend is over.
- ETHs charts are fairly uncertain. A move up and down are both feasible with the indicators showing no real push towards any certain direction.
The crypto markets have had a poor week. Many cryptocurrencies have seen X>5% losses, while BTC has not shown any real success at attempting to breach and clear $12500 USD; neither was it able to secure the $12000 USD.
The reason for this is that BTC is currently taking a necessary breather. It is easy to forget that BTC was at $4000 USD in March and is now at $11350 USD (at the time of writing), this is a huge increase in price.
If BTC were to simply explode as it did in 2017, without the current breathers, it would enter another bubble. It is important for the market as a whole that BTC does not get stuck in a bubble. This is because if BTC was caught up in one it could create another wave of investors who will not touch cryptocurrencies due to them being locked at the wrong end of the bubble, or due to it being too much of a risk.
Currently, there is reason to believe that BTC is not caught in a bubble and that the moves being seen are somewhat logical. However this cannot be said about most of the market, in particular one sector – DeFi. Some are even calling to #shortdefi
More on that later…
BTC is currently in the fourth stage of its five stage move. This stage revolves around the retracement of the cryptocurrency from its stage three highs.
This stage three height was the attempted break of $12500 USD – which failed. Stage four will be very similar to stage two, hopefully with $11100 USD acting as the support for stage four. If this is broken below it will be $10800 USD. However if $10800 USD is broken below, then serious consideration of BTCs bullish outlook will need to be reconsidered.
Why did BTC do so poorly on 02/09/2020?
September 2nd, BTC seemingly fell out of nowhere, falling from $12050 USD all the way to $11250 USD. This saw BTC lose 5% over the space of a day, a big loss for something with a $208,039,000,000 market cap.
From a first look, it appears that this was caused simply by a break of the trendline below. However, this is wrong and the trend line below does not have enough validation points, failing to capture most of the movement.
BTC/USD false trend line
Instead what occurred was a false breakout of the broadening formation shown below.
The reaction of traders was then exaggerated by the market’s leverage options. It is likely that traders would have placed a long entry where marked below. This would have been placed due to BTC breaking above the overarching resistance of the broadening formation, with the candles then using this resistance as support.
After that there was a significant break. Long entry would have been likely placed as from there it appears that the likelihood of $12000 USD being broken would be very high. However, $12000 USD was completely rejected seeing BTC re-enter the broadening formation – this is always a major bearish sign (or a sign that you’re drawing your charts wrong). From here traders would have placed shorts as many of the indicators turned bearish before BTC hit the $11200 USD support level.
BTC/USD what happened
As demonstrated below and discussed earlier, thanks to BTCs gradual and sustainable increase in price there was a significant support level which was able to catch BTC and prevent a huge move down. This support level has had multiple points of validation over the past couple of months and before then; it is one of BTCs strongest levels. It has now added more validation points as of 03/09/2020.
BTC/USD added support
However, where does this leave BTC now? With no formations on the daily / weekly or even hourly chart, where does BTC stand?
Overall, the cryptocurrency market is still looking bullish. However, the market is taking a breather. One way we can gain a foothold on the market sentiment is through looking at the BTC dominance. Currently BTC dominance is falling. This is a positive sign for the cryptocurrency market. During times of bullish behaviour BTCs market dominance often falls, while during bearish periods the opposite usually occurs.
This is because during negative times alt coins always get hit harder than BTC, so people place their money into BTC as it is more of a ‘safe haven’ or they place their crypto into USDT. Therefore, by BTC currently being in a negative channel the market sentiment is still bullish. That is unless BTC breaks positively above the parallel channel which the BTC.D is currently trading within.
BTC/USD market dominance
As demonstrated below, when BTC went from 12100 USD towards $11200 USD as discussed earlier we can see that the BTC dominance increases when BTC falls in value. The BTC price is represented by the red line, while the dominance is represented by the candlesticks.
There is an inverse correlation between BTC and the BTC market dominance.
BTC/USD dominance vs price
BTC daily outlook
From the daily outlook we can once again see that BTC is in the fourth consolidation stage. BTC is moving violently within all parts of the BBs, however is not hyperextending either direction. The hyperextension direction of BTC in the next move will determine whether wave five takes place, or whether there is a new corrective wave and the end of this impulsive wave. The BBs have also contracted, again indicating that we are approaching a period of sideways trading. There are lots of similarities between BTCs current behaviour and BTCs behaviour during the sideways trading period between June and mid-July.
BTC current support levels
The current significant support level which BTC is holding is $11300 USD (at the time of writing). As shown below BTC has already used this level three times as support during the past month. Due to the gradual weakening of this support level the likelihood of BTC being held is relatively low, however we will see…
BTC/USD BBs, support levels
The MACD is currently bearish. It is showing signs of weakness and could very easily see a positive break in the positive region. However due to the MACD being bearish this could be bad news for the $11300 USD resistance. The MACD could lead to a break below this level. That would see BTC lose a serious amount of the recent gains made.
BTC/USD dangerous MACD
Set one – QQE MT4, RSI
QQE MT4 – The QQE MT4 is currently bearish, however there has been a divergence. This could mean either that BTC has some huge red candles waiting for it, or that the bulls are controlling the bears, allowing for a slight sell off before BTC reaches for new heights. Overall the indicator is bearish
RSI – There is currently a 50/50 balance shown by the RSI. The demand for BTC has clearly dropped. This indicator is neither bullish or bearish – neutral.
Indicators set one QQE MT4, RSI
Indicators set two – KCs, SAR, PPs, WWV
KCs – The KCs are neither bullish or bearish. They are suggesting that BTC will trade sideways and that we should wait for a break out in either direction before we place a position.
SAR – The SAR is currently above the BTC price. This again is another bearish indicator.
PPs – BTC has recently fallen below the central PP. This is very significant and shows us that the tide may be turning towards the bears – the bulls are potentially losing control. Bearish.
EFI – The EFI has shown that since the huge price gains of mid-August the bears are trying to sell off BTC. This has recently been displayed with BTC currently below the EFI centre point.
WWV – The WWV is currently bullish due to the indicators showing a green wave.
BTC/USD KCs, SAR, PPs, WWV
Indicators set three – Gann HL, 6&20 day SMA
6/20 SMA – There has recently been a bearish crossover for the SMAs. This has seen the 6 cross underneath the 20 day SMA. This indicator is bearish.
Gann HL – The Gann HL is currently bearish. This is due to the Gann HL being below the candles.
Indicators set three – Gann HL, 6&20 day SMA
BTC/USD Indicators table
As has been demonstrated above the sentiment from the indicators is that BTC is clearly bearish. This therefore spells bad news for the $11300 USD support level and could see BTC have lots of its recent gains wiped.
BTC is looking bearish. How BTC reacts to the bearish indicators will shape the rest of its year. If BTC can hold onto the $11300 USD support levels until the indicators turn bullish then we should see BTC reach ATHs again before the end of the year. However if BTC fails to hold onto this level then we will likely see BTC fall all the way back down to $10500 or even $10000 USD in the coming weeks.
SUSHI is a very new cryptocurrency and is one of the latest DeFi craze coins. Its TA is displaying that a potential breakout could be about to occur. SUSHI has broken above its recent downwards parallel channel and has seen the MA of the BB act as support during its attempted break above.
If SUSHI can manage to break above the central PP then this new crypto will undoubtedly become bullish. However we will need to wait for this break above to occur in order to manage risk levels. If SUSHI does not break above the central PP then we will likely see SUSHI hit $6.1 USD, potentially even $5.7 USD – the S1 point. Whether SUSHI can break above this level will likely depend on BTCs actions.
LTC has been one of the worst performing major cryptocurrencies since the March meltdown as shown below with a BTC and ETH comparison.
LTC/USD BTC and ETH comparison.
Unfortunately the indicators and patterns which LTC is showing are indicating that this trend will continue. The ‘silver Bitcoin’ currently has numerous bearish indicators and is only being held up by the 0.5 Fibonacci support level as indicated below.
The current chart is indicating like BTC that price loss or sideways trading will occur. In this chart the PnF is bearish alongside the MACD while the BBs are waiting for a breakout in either direction to occur before giving any indications.
NEO has been very strong recently rising from $12 to $20 USD over the course of a month, an increase of 80%! Whether this will continue, however, is somewhat in doubt; it will depend on NEOs ability to use the BBs 20 day MA support line.
NEO vs ETH/ETC/EOS/ADA/BTC
NEO has been very strong recently rising from $12 to $20 USD over the course of a month, an increase of 80%! Whether this will continue however is somewhat in doubt; it will depend on NEOs ability to use the BBs 20 day MA support line.
The indicators are currently bullish. The SAR is below the candles, the candles are in the upper region of the BBs and the MACD is currently positive. However the Heikin Ashi are red. If NEO can pass this quickly and switch back to green then expect NEO to hit $23 USD. However if NEO cannot and the bearish QQE MT4 takes over then NEO will likely hit $19 dollars. If this happens then unfortunately $13 USD is a very realistic target for after $19 USD.
NEO/USD chart TA
LEND has been one of the top performing cryptocurrencies of 2020, however, this appears unlikely to continue. Seeing a cryptocurrency increase 16000% over the course of a year reminds us that this market clearly still holds potential, and that 2017 was not just a one time hype bubble. However, when a cryptocurrency rises this much in a year, a retracement is to be somewhat expected…
LEND currently is showing a bearish descending triangle formation, this is due to there being a negative break below the triangle by the candles. LEND has now reached the $0.64 USD resistance. If this is broken below expect LEND to hit $0.53 USD, if LEND remains above and BTC does not break below $11300 USD then LEND will likely re-hit $0.74 USD in the coming days.
Out of the options above $0.53 USD appears most likely due to the bearish formation and the array of bearish indicators from the recent move down.
EOS has performed terribly since March when compared to other cryptocurrencies.
Recently, EOS has been somewhat all over the place with the charts, lots of volatility, although no real direction. EOS failed to maintain its gains above the 0.5 Fibonacci retracement levels. This means that the price gains since March are likely a part of a corrective rather than impulsive wave.
EOS/USD lack of direction
However, from this recent volatility a really great potential short position has set up. This has seen a head and shoulders formation created. We are currently fast approaching the neckline. If this is broken below then a fall towards $2.6 USD and then $2.4 USD will very likely happen. A drop towards $2.4 USD would result in a 16% loss from our current position.
Out of all the alt coins XRP is looking like one of the more promising options.
Many of the alt coins have bearish set ups, XRP included although appears the best out of a bad bunch, effectively. XRP has recently broken above the descending triangle which was created recently. If XRP can remain above the $0.26 USD support level then there is little reason why XRP cannot attempt to push the $0.30 USD resistance level again.
However, as shown below XRP has a bearish MACD. On top of this the QQE MT4 and the SAR are bearish, all of which pose a threat to XRPs ability to stay above $0.26 USD.
XRP has support at $0.245 USD and with XRP one of the older cryptocurrencies this support has more historical relevance which is why if the potential sell off occurs XRP should be one of the better performing cryptocurrencies.
A fall towards $0.245 USD would represent an 8.5% loss from our current position.
QTUM has performed very well since March, however as demonstrated below QTUMs bullish trend is over. The recent broadening formation has been broken below, while the coin has also used the lower part of the BB as support.
QTUMs indicators are currently bearish, with the MACD for QTUM super bearish further losses appear highly likely.
QTUM/USD daily chart TA
On top of the bearish formation on the daily chart, there is also a bearish formation on the hourly chart. The bullish descending triangle which was expected to send QTUM back up and keep the cryptocurrency in the formation has recently turned bearish. This is due to QTUM not being able to break the 0.236 Fibonacci retracement. QTUMs candles have now clearly broken below the support line for this move therefore making this descending triangle now bearish.
From this the next price which looms for QTUM appears to be $2.6 USD (-14%) and after that $2.1 USD (-27.8%).
QTUM/USD bearish formation
The final cryptocurrency which we are going to look at is ETH.
ETHs charts are fairly uncertain. A move up and down are both feasible with the indicators showing no real push towards any certain direction. There is also no pattern which has formed on the daily or 2hr charts at time of writing.
If the move up occurs this would be because of the support from the bullish indicators PnF, Gann HL and the SMAs. If the move down occurs this is due to the MACD being weak and the QQE MT4 being bearish.
This intelligence report is for marketing and educational purposes only. The views, analyses and projections are based on independent research, but cannot be taken as a form of investment advice.