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Charts Favor a Drop Below $11,000
BTC: Price: $11,250 | MCAP: $201 billion | 24-Hr Volume: $13.77 billion
Short-term trend: Bearish
Bitcoin has created a bearish lower high above $11,400 on the hourly chart, reinforcing the bearish view put forward by the range breakdown witnessed over the weekend and the bear flag breakdown confirmed yesterday.
The hourly chart relative strength index is reporting bearish conditions with a below-50 print. Further, the 5- and 10-day moving averages have produced a bearish crossover.
So, a drop below $11,000 looks likely. The bearish case would weaken if the bearish lower high on the hourly chart is invalidated with high volumes. That would open the doors to $12,000.
Long-term trend: Bullish
Bitcoin snapped its five-month winning streak with moderate losses in July. More importantly, the cryptocurrency created an inside bar candle, a sign of consolidation or exhaustion following a stellar rally from April's low near $4,050.
Even so, the path of least resistance remains to the higher side as the bullish structure on the monthly chart is intact.
For instance, the falling channel breakout confirmed in April is still valid. The 5- and 10-month moving averages continue to trend north, indicating a bullish setup. Further, on the 3-day chart, the 50- and 200-candle moving averages (MAs) have produced a golden crossover, the first since Feb. 3, 2016.
However, a deeper correction to $7,500 cannot be ruled out, if prices drop below $9,049, validating the inside bar pattern.
That said, the long-term bullish outlook would be invalidated only if prices print a UTC close below the 200-day MA, currently at $6,417.
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ABBC's Benign Breakout
ABBC: Price: $0.20 | MCAP: $114.4 million | 24-Hr Volume: $66.2 million
Short-term trend: Neutral
ABBC is one of today's best performing crypto in the top 100 at CoinMarketCap, up 35.47 percent after breaking bullish from a higher low formed on on August 12 at $0.1423.
However, it also marks the second time that prices have interacted and seen a rejection below the 50 percent Fibonacci retracement line - a bearish indication.
Also known as a pivot point, it signifies a need to push higher today on the back of favorable bullish indicators represented in the daily RSI above the neutral 50 line and the awesome oscillator histogram ticking up for the bulls.
Long-term trend: Bearish
ABBC's failed breakout beyond the 50 percent pivot point also marks the continuing lower high market structure that has prevailed since its first major breakdown on Nov. 13, 2018.
Volume has also been much stronger for the bears as the second and third quarters have offered little in the way of hope for long investors of ABBC.
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| Enjin Coin Continues To Slump
ENJ: Price: $0.06844 | MCAP: $53.1 million | 24-Hr Volume: $4.5 million
Short-term trend: Bearish
ENJ is down 4.38 percent, continuing its 9th day in the red and piercing through a 149-day trend line that has steadily held price along its trajectory down since March 11, 2019.
Further, the daily awesome oscillator is signaling continuation down, exposing Fibonacci supports located at $0.05946 should the RSI fail to induce a bounce here.
Long-term trend: Bearish
Extreme low levels of total daily volume also presents considerable problems for the flailing crypto. A need to bounce hard with a follow through from the bulls is paramount to reversing the damage caused from the comedown of the Samsung hype.
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Bitcoin jumped more than 7 percent to one-month highs above $11,950 on Aug. 5 – the day when China allowed Yuan to depreciate beyond 7 per U.S. Dollar for the first time since 2008.
Notably, China’s offshore Yuan exchange rate (CNH) fell from 6.97 yuan per U.S. dollar to a multi-year low of 7.1085 per USD in the 60 minutes to 02:00 UTC today.
Meanwhile, BTC picked up a bid around $10,980 at 00:00 UTC – an hour before CNH began falling against the dollar.
The price action convinced many that the rally was triggered by wealthy Chinese investors rotating money into BTC on fears of yuan’s depreciation.
More importantly, the narrative that BTC is being treated by the Chinese investors as a safe haven asset has strengthened over the last few days.
The price data, however, say otherwise. The cryptocurrency was trading at a discount of 1 percent in China on Monday, as tweeted by Prominent Analyst Larry Cermak.
In fact, it traded at 2 percent discount shortly after last week's Yuan slide.
If BTC was a preferred safe haven in China, its prices would have traded at premium to prices on Western exchanges.
So, it seems safe to say that bitcoin is still an uncorrelated asset and that makes it a perfect hedge against the current turbulent times in the global economy. |
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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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Bitcoin a Safe Haven?