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BTC: Price: $3,800 | MCAP: $67.50 billion | 24-Hr Volume: $10.96 billion
Outlook: Neutral
Bitcoin sees biggest single-day drop since Jan. 11
Bitcoin fell 9.31 percent yesterday to levels below $3,700. The biggest single-day drop since Jan. 11 was accompanied by a jump in trading volumes to $10.79 billion – the highest since April 25, 2018, according to CoinMarketCap.
Notably, Sunday's price drop engulfed price action seen in the previous five days, thereby weakening the bullish case put forward by last Monday’s break above $3,800.
That said, a bullish-to-bearish trend change would be confirmed if Sunday's sell-off is extended to sub-$3,700 levels. That would open the doors for a drop toward the recent lows below $3,400.
The drop to $3,400 or below, however, could be short-lived, as longer term charts are signaling bearish exhaustion. For instance, the inverted hammer seen in the weekly chart indicates that the buyers managed to eke out gains last week despite the sell on the rise mentality. Put simply, the bulls are beginning to test bear's strength, which is a sign the market is bottoming out.
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Is The Bull Back?: Long time markets analyst and cryptocurrency chartist, Peter Brandt, offers his perspective on bitcoin's most recent price action and describes it as another example of a dead cat bounce . That fact persists with current lower highs or similar highs at strong resistances such as $4,200. He argues further, stating there is no bitcoin bottom yet in sight; In his view the current weekly market structure remains down while the daily structure is up and makes a point for no clear indication of a bitcoin bottom pattern appearing on the long-term time frames. While the channel break last week and minor falling wedge breakout on Dec. 17 were encouraging, Brandt doesn't see signs of the bulls return just yet.
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51 Percent Attacks For Rent: In order for cryptocurrencies to remain decentralized in a proof-of-work environment, no single party should control the majority of total hashing power writes Anthony Xie, founder of HodleBot, a tool that helps diversify portfolios and automate trading strategies. He argues that as the global pool of hashing power grows more liquid, cryptos need to jump through more hoops to pass another important test. They must be able to resist attacks from the total rentable hashing power for their specific algorithm and platforms. Otherwise opportunistic arbitrageurs will find it financially attractive to rent hashing power needed to perform the harmful 51 percent attacks.
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EOS: Price: $3.59 | MCAP: $3.25 billion | 24-Hr Volume: $2.58 billion
Outlook: Consolidation
EOS Falls The Hardest
Down 14.92 percent over a 24-hour basis EOSIO has experienced a harsh sell-off that brought it down to local supports at $3.50 before bouncing slightly higher to where prices currently stand at $3.67; It is also the biggest loser amongst the top 10 crypto according to CoinMarketCap data.
The 100-day moving average will most likely offer the next area of support at $2.77 should prices break further, but that will depend largely upon continual selling pressure and a willingness by the bears to dismantle the recent bullish market structure of higher highs and higher lows for the second half of Feb.
The Chaikin Money Flow (CMF) shows price action still resides above the bullish pivot of 0 at 0.11, while the RSI has experienced a pullback from overbought and has dipped back toward healthier levels of 59; If prices do dip below $2.77, consider a revisit to prior breakout supports at around $2.27.
VRM: Price: $0.35 | MCAP: $705,223 | 24-Hr Volume: $4,038
Outlook: Pullback-Consolidation
VeriumReserve Follows Suit
VRM has dropped alongside the rest of the market, excluding but a few projects, into the red and is currently down 16.45 percent over a 24-hour period after bitcoin experienced an 8 percent drop on Sunday.
The initial rejection on Feb. 8 from the 200-day moving average (MA) did little to halt the advance of higher highs for a 10 day period from Feb. 13 to Feb. 23 but it would appear the bears have come down harder this time, increasing selling pressure before the candle was halfway to the MA.
The high low market structure remains intact however, despite the greater market sell-off, but remains tentatively bullish just above the pivot point of $0.35, whereby a drop and close below that level would tempt the bears to go lower.
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Bitcoin's inflation rate will drop to 1.8 percent following it's third mining reward, scheduled next year.
It essentially means, the leading cryptocurrency would become less inflationary than major central banks - European Central Bank, Bank of Japan, Reserve Bank of Australia - who are targeting 2 percent consumer price inflation target via unconventional policies like quantitative easing, negative interest rates.
So, other things being equal, BTC should appreciate against most advanced nation currencies, as the inflation differential is set to skew in favor of the crypto market leader. |
Open interest in ether tanked 40 percent yesterday as prices fell more than 16 percent, the biggest single-day drop since Sept. 5, 2018.
A drop in open interest along with a slide in price mostly represents unwinding of long positions.
Put simply, the 16 percent drop was likely fueled by profit taking on positions, possibly initiated a month ago, when ETH was trading below $100.
So, the drop may have aborted the immediate bullish view, as per the technical charts.
Had open interest spiked, it would have meant fresh selling – a sign that sell-on-rise mentality is still intact or the market is yet to find a bottom. |
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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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Volumes Spike