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Bitcoin Defends 200-Day MA
BTC: Price: $9,200 | MCAP: $165.92 Billion | 24-Hr Volume: $25.41 Billion
Short-term trend: Bullish
The repeated defense of the 200-day average indicates the pullback from the Oct.25 high of $10,350 has likely ended and a price bounce, possibly to key resistance at $10,600 could be in the offing.
A bigger bounce cannot be ruled out as the pullback from $10,350 to $9,000 was accompanied by falling volumes.
A few observers believe the bounce may remain elusive, as bitcoin's hash rate or computing power is falling and price may follow suit. The metric has dropped to around 90 exahashes per second (EH/s) since Oct. 24. However, in the past, prices have rarely followed the hash rate.
In fact, the hash rate tends to follow bitcoin's price. After all, the movement in prices influences mining profitability.
That said, the case for a bounce to $9,600 would weaken if the hourly chart support at $8,977 is breached.
Long-term trend: Bullish
Reward halving is likely to keep bitcoin better bid over the next few months. Historical data shows the cryptocurrency rallied from $5 to $16 during the six months leading up to the reward halving in May 2020.
Also, BTC jumped from $360 to $780 in the four months to mid-June 2016, before trimming gains and falling back to $465 in August, when the block reward was cut from 25 BTC to 12.5 BTC.
More importantly, BTC continued to scale new heights following the reward halving. The long-term bullish case The bullish case looks stronger if we take into account the strengthening narrative that the top cryptocurrency is a digital gold and a hedge against inflation.
Many observers believe the negatives interest rate era could force traditional investor to pour money into cryptocurrencies. After all, BTC is the best performing asset of 2019 and possibly of the decade.
Long-term technical studies are also biased bullish. For instance, the 100- and 200-period averages have produced a bullish crossover on the three-day chart. A similar bull cross in March 2016 was followed by a 21 month bull market.
The bullish view would be bolstered if and when prices exit the four-month falling channel seen on the weekly chart, confirming a resumption of the rally from lows near $4,000 seen in April.
That looks likely by the year's end, as the three-day chart MACD, which has a strong record of signaling big moves, has turned bullish for the first time in over three months.
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LINK Pumps The Breaks
LINK: Price: $2.72 | MCAP: $961.9 million | 24-Hr Volume: $125.2 million
Short-term trend: Pullback
LINK has risen x percent over a 24-hour period, stopping short of a former peak high at $2.76 witnessed Oct. 29, multiple hourly candles have closed below that point.
Repeated failures to scale above, leads to expectations of a greater pullback in its price to prior lows near $2.68 and then former resistance at $2.65. That theory is backed by a bearish divergence on the RSI indicator.
Long-term trend: Neutral
The long-term market structure for LINK continues to suffer a breakdown witnessed Oct. 26 starting from a peak high of $3.09.
The daily oscillator (not shown) is flagging waning bullish momentum with decreasing histogram bars demonstrating the bears are beginning to regain control.
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| NEO Looks To Hold The Line
NEO: Price: $10.34 | MCAP: $732.5 million | 24-Hr Volume: $535.5 million
Short-term trend: Pullback
NEO continues its second day in the red after a strong bearish close on Oct. 31. Price action is currently taking respite along a former area of resistance at $10.31 and is beginning to show signs of bullish exhaustion.
The awesome oscillator on the daily chart is flashing signs of weakening bull momentum post rally, witnessed Oct. 25-Oct. 28. Coupled with decreasing levels of volume, price action will continue to consolidate until it cracks the former resistance flipped to short-term supports at $10.31.
Long-term trend: Neutral
A pullback in its bullish price action is expected, however, the long-term trend remains neutral until a firm close below the area mentioned above occurs, should it occur.
Conversely, the trend would flip bullish long-term should prices close above Oct. 28's peak high of $13.68, enticing further buyers into the fold.
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Litecoin's hash rate or computing power is in a free fall.
The non-price metric stood at 185 TH/s on Oct. 31, the lowest level since January, representing a 64.64 percent drop from the high of 522 TH/s registered on July 14.
The majority of the drop has happened following the Aug. 5 – the day when the mining reward for every block was reduced from the previous 25 LTC to 12.5 LTC. The process aimed at curbing inflation by reducing block rewards by 50 percent is repeated every four years.
Essentially, mining profitability drops with reward halving if the price of the cryptocurrency remains stagnant or drops.
The cryptocurrency currently trades at $58, having hit a low of $47 earlier in October. At that price, LTC was down 56 percent from the high of $107.00 seen on Aug. 5.
Put simply, mining litecoin became uneconomical post-halving. That explains the drop in the computing power on the litecoin blockchain.
Note that the hash rate represents network security. The higher the hash rate, the more difficult it is for malevolent actors to launch an attack on the network. |
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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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Falling Hash Rate