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Bitcoin Eyes Resistance at $8,500
BTC: Price: $8,220 | MCAP: $147.92 Billion | 24-Hr Volume: $17.63 Billion
Short-term trend: Bullish
Bitcoin jumped 4.47 percent on Monday, the biggest single-day rise since Sept. 2. More importantly, the cryptocurrency created a bullish outside bar candlestick pattern on the daily chart, warning of an impending bullish reversal.
Further, the MACD histogram, an indicator used to identify trend strength and trend changes, has crossed above zero, confirming a bullish reversal. Meanwhile, the daily line chart is reporting a bullish divergence of the 14-day relative strength index (RSI).
All-in-all, BTC looks set to challenge Oct. 1’s high of $8,531 in the short-term. A UTC close above that level would invalidate the bearish lower highs pattern, as tweeted by popular analyst Josh Rager.
The case for a drop to $7,200 would strengthen if prices find acceptance under the 100-week MA at $7,756, as discussed yesterday, although as of now that looks unlikely.
Long-term trend: Bearish
Bitcoin closed below $9,049 on Sept. 30, confirming a bearish inside bar candlestick reversal on the monthly chart.
The cryptocurrency had charted consecutive inside bar candlesticks in July and August, indicating indecision or consolidation.
The tug of war between the bulls and the bears ended with a 20 percent drop in September. Further, the weekly relative strength index is now reporting bearish conditions with a below-50 print.
Put simply, the path of least resistance is to the downside and a drop to $7,000 or even lower could be see in the next few weeks. The bearish case would strengthen once the 100-week MA support is breached.
The bearish setup would be invalidated if and when prices find acceptance above the former support-turned-resistance of $9,049.
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High Hopes For ABBC
ABBC: Price: $0.22 | MCAP: $124.08 million | 24-Hr Volume: $49.3 million
Short-term trend: Neutral
A bearish divergence taken from Aug. 5-Sept. 20 can be seen on the daily chart and continues to demonstrate greater sell pressure as the previous 6-day rally of 214 percent did little to break the higher low trend.
Volume has been on the decline since June 28, a sign that investors have become wary of further price rises delivering a bearish analysis on a rising price and falling volume - as per standard volume analysis.
Expect a pullback and possible sell-off which is backed by the awesome oscillator (AO) ticking down toward the neutral (0) zone.
Long-term trend: Neutral
Despite a failure to take the peak high of $0.28, a bullish pennant formed from the aforementioned rally in Sept and as such may offer up a reversal to long-term bearish market conditions from a strong breakout above the sloping trend line at $0.24.
Keep an eye on supporting daily and intraday volume such as the hourly and 4-hour chart.
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| UNUS SED LEO In A World Of Hurt
LEO: Price: $0.95 | MCAP: $952.3 million | 24-Hr Volume: $10.4 million
Short-term trend: Bearish
Into its fourth day loss, LEO is down a further 1.42 percent on the day after closing just below the lower sloping trend line on Oct 7.
Backed by consistent selling volume (red bars) on each subsequent sell-off, investors appear to be wary of any further investment until a reversal is spotted with a firm close back above $1.05 (prior supports turned resistance).
Long-term trend: Bearish
The AO has extended its bar range down below 0 and has opened up further possibilities for a greater decline in value.
Be mindful of the oversold daily RSI which is at its lowest point since first listed on May 21 and may offer a short-lived bounce that could throw into contention the long-term trend should a firm close above $1.05 occur.
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Negative interest rates have become a new normal in Europe and Japan these day and many observers believe the U.S. may be the next to adopt a negative interest policy.
As of now, $17 trillion worth of bonds are offering negative yields. Put simply, financial institutions in Europe and Japan are required to pay interest for parking excess reserves with the central bank.
More importantly, German banks are now beginning to pass on the negative rates to retail clients.
If taxing clients for saving wealth becomes a trend, the demand for safe haven assets with intrinsic value like rare earths (Gold) and bitcoin could rise.
Note that bitcoin's monetary policy is deflationary in nature, as supply is reduced by half every four years. Hence, the top cryptocurrency could become a preferred store of value amid the negative rates environment.
Also, traditional investors may venture into stablecoins like tether (USDT), paxos standard (PAX), Circle’s usdcoin (USDC), and Maker’s dai (DAI). This is because companies like Nexo are reportedly offering 8 Percent interest rate on stablecoin holdings.
All-in-all, the negative interest rate era could quicken the pace of cryptocurrency adoption. |
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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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Negative Rates