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Correction Underway
BTC: Price: $11,800 | MCAP: $210.95 billion | 24-Hr Volume: $44.16 billion
Short-term trend: Bullish
Bitcoin has pulled back more than 15 percent from the 17-month high of $13,880 (Bitstamp prices) hit on Wednesday. Even so, the outlook remains bullish as the price is holding well above the May 30 high of $9,097, meaning the bullish higher lows and higher highs structure is intact.
That said, the hourly chart is reporting a bearish lower highs and lower lows setup and the price seems to have found acceptance under the 50-hour moving average – a level which consistently reversed pullbacks throughout the recent rally from $7,500 to $13,880.
As a result, a deeper correction to levels below $11,000 cannot be ruled out. That said, the outlook as per the hourly chart would again turn bullish if the price violates the bearish channel. In that case, the cryptocurrency will likely retest $13,880.
Long-term trend: Bullish
BTC closed last month with 62 percent gains – the highest since August 2017 – reinforcing the falling wedge breakout confirmed by April's candle.
Further, the 5- and 10-month moving averages have produced a bullish crossover for the first time since September/October 2015.
The long-term bullish outlook would be invalidated if and when the price finds acceptance below May's low of $5,263.
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Chainlink Breakout LINK: Price: $2.33 | MCAP: $829.3 million | 24-Hr Volume: $185.8 million
Short-term trend: Bullish
LINK is up 13.72 percent over a 24-hour period after bitcoin's (BTC) recovery from lows of $11,350 finished dragging the markets down.
Now looking strong on its current ascending triangle breakout on the daily chart, backed by consistent levels of volume.
Prices are overbought as can be seen on the RSI, however, the CMF is yet to show much of a sign of sliding back toward greater selling pressure below 0, another favorable factor for a continuation in its price throughout the rest of the week.
Long-term trend: Bullish
LINK is currently up 667.9 percent year-on-year, presenting the genuine question of whether or not it can extend its gains any further. However, given the nature of the trend and the formation of higher highs and higher lows backed by consistent liquidity, the trend remains bullish until a drop firm close below $1.36 occurs.
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Dent Pulling Back Amid New Heights DENT: Price: $0.0020 | MCAP: $147.3 million | 24-Hr Volume: $7.1 million
Short-term trend: Bull potential
A dropback to the 38.2 percent Fibonacci retracement level at $0.0016 is open for DENT as it continues its third day straight in the red.
Down 13.25 percent over a 24-hour period, it is one of the worst performing crypto in the top 100 at CoinMarketCap, but that could change soon.
If a retest occurs expect the maximum draw down to touch the area marked green, however, should a swift bullish reversal occur, consider the momentum to be trending in upward fashion, courtesy of a bullish RSI above 50.
Long-term trend: Bullish
The trend remains considerably bullish given the current positioning of its pullback, resting within a former channel between the 0 and 23.6 percent Fibonacci levels. Only a firm close below $0.00146 could upset its recent uptrend.
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Bitcoin dived out of a low-volume narrowing price range (consolidation) earlier today to hit a low of $11,200, as predicted by @Mangyek0, when the cryptocurrency was trading at $12,600.
The bearish prediction was primarily based on the bearish divergence of the relative strength index (RSI).
The RSI is one of the most widely tracked indicators for confirming the prevailing trend in prices and gauging overbought and oversold levels.
A rise in RSI, especially in 50-80 range, along with the rise in price is considered a sign of further gains. On similar lines, the RSI in a stock facing a strong downtrend usually moves between 50-20.
Sometimes, however, the indicator diverges from the price trend. A bearish divergence occurs when the RSI starts falling or creates a lower high, as opposed to higher highs in price. A bullish divergence occurs when the indicator creates a higher low, contradicting the lower lows on price.
A bearish divergence is widely considered a sign of buyer exhaustion and an impending correction, which was the case with BTC in early European trading hours, as noted by @Mangyek0.
Also, the fact that volumes were down during consolidation suggested bullish exhaustion and scope for correction. |
CoinDesk’s article sheds light on the relationship between the spike in bitcoin’s mining difficulty and the recent price rally and the impact of delayed onset of the rainy season in Sichuan province of China, which alone produces 50% of the global hash rate (computing power).
Bitcoin’s mining difficulty – the measure of how hard it is to earn rewards by mining on the blockchain – has hit a new record high above 7.93 trillion, surpassing the previous lifetime high of 7.45 trillion seen two weeks ago.
It is worth noting that bitcoin’s price has rallied by 85 percent in the last two weeks. The sharp rise seem to have attracted more miners to bitcoin’s blockchain, leading to a rise in the hash rate and the mining difficulty.
This is because bitcoin is designed to adjust its difficulty every 2,016 blocks approximately, based on the amount of computing power on the network. The difficulty falls if there are fewer machines working to solve the algorithm to earn bitcoin and rises when the number of computers rise.
Both the network hash rate and the difficulty could continue to rise as mining farms in Sichuan province were only running less than half of their total capacity in the past month and will likely run at full capacity during the rainy summer season, which has been delayed by a month this year. |
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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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Double-Digit Pullback