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Off One-Week Lows
BTC: Price: $10,420 | MCAP: $186.93 billion | 24-Hr Volume: $15.67 billion
Short-term trend: Neutral
Bitcoin's drop to one-week lows below $10,100 seen earlier today was short-lived and prices rose back above $10,400 an hour ago, confirming a falling wedge breakout on the hourly chart.
Therefore, the bearish view put forward by Friday's big bearish engulfing candle stands neutralized.
The outlook would turn bullish if and when prices print a UTC close above $10,956 – a bearish lower high created on Aug. 20.
Also, if the falling wedge breakout fails in the next few hours, the prospects of a slide below $10,000 would improve. On the downside, key support is located at $9,755 (Aug. 22 low) and $9,320 (Aug. 29 low).
Long-term trend: Neutral
Bitcoin's monthly chart shows a double inside bar pattern – August’s candle falls within July's high and low and July’s candle is engulfed by June's high and low.
Double inside bars indicate indecision and lack of volatility and are considered a sign of bullish exhaustion, if they occur after a notable price rally, which seems to be the case here.
Also, the selling volume witnessed in July was the highest since March 2018. So, the long-run outlook stands neutralized.
A break above the high of the first inside bar ($13,200) is needed to revive the bullish outlook and a move below the low of the first inside bar ($9,049) will confirm a bearish reversal.
Traders can also take a weekly (Sunday, UTC) close or consecutive high-volume daily closes above $12,000 as a sign of bullish continuation. After all, a weekly close above $12,000 has remained elusive the last week of June.
Read Analysis
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ATOM's Rally
ATOM: Price: $2.51 | MCAP: $505.2 million | 24-Hr Volume: $196.3 million
Short-term trend: Bull potential
Today's higher low candle post-rally could offer up an area for the bulls to recoup and gather for another push above recent resistances at around $2.74.
The awesome oscillator (AO) has begun to cycle up toward the neutral 0 zone demonstrating growing bullish momentum while the RSI is hinting at slightly bearish in the immediate short-term as it sits slightly below the neutral 50 line at 49.39.
Keep an eye on total bullish volume to see if it can surpass what the bears have put forward over the last week.
Long-term trend: Neutral
Prices have begun to reverse after bottoming out at $1.91 on September 5
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Ravencoin Under Pressure, But Defending Key Support
RVN/USD: Price: $0.031194 | MCAP: $136 million | 24-Hr Volume: $13 million
Short-term trend: Neutral
Ravencoin is flashing red amid the uptick in most alternative cryptocurrencies. RVN, however, is holding above key support at $0.03, a level which has consistently put a floor under prices in the last three weeks.
The outlook, therefore, will remain neutral as long as prices are holding above $0.03.
Also, the repeated defense of that key support may entice buyers, leading to a minor bounce above the immediate resistance at $0.034. The bias, however, would turn bullish if and when the cryptocurrency rises above $0.04360 (Aug. 24 high), invalidating the bearish lower highs setup.
Long-term trend: Bearish
The path of least resistance will remain to the downside, as long as the double top breakdown confirmed in the second week of August is valid.
So, prices will have to rise above the former support-turned-resistance of the double top neckline of $0.03850 to invalidate the bearish view.
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ETH/USD's daily chart shows a price breakout, however, the ascent, if any, is expected to be slow and prices are unlikely to rise above $600 this year, according to options market activity.
Data from Deribit exchange tweeted by @skew_markets shows heavy writing (selling) in December expiry call options at $600 strike.
A call option gives the buyer a right but not the obligation to buy the underlying asset at an agreed price on or before a particular date. Put simply, a call option is a bullish bet.
So, an investor would sell a call option if he/she doesn't expect the market to go up.
Therefore, the selling in $600 December expiry ETH call option indicates the investors don't expect the cryptocurrency to rise above that level in 2019.
The above tweet also shows call selling in October expiry $280 call options and September expiry $320 call option.
Risk profile of a call seller
A call seller is obligated to sell the underlying security at the strike price if the option is exercised. So, by writing or selling a call option, the seller is giving the buyer of the call option the right to buy the underlying from seller at a certain price by a certain date.
The seller of the call receives the premium that the buyer of the call option pays. The premium received is the maximum money that an investor can make by selling a call option.
Put simply, the maximum profit will be equal to the premium received if ether's price is at or anywhere below $600 on December expiry date.
The position will be in loss if ether's price is above $600 on expiry. Theoretically, a call seller can lose infinite money because prices can keep going up – ETH could be at $500, $600, $1,000 or even higher on the expiry day. |
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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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Call Selling