Cryptocurrency Market Outlook; Bitcoin Is Dragging Them All Lower

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:

  • BINOMO
    BINOMO

    2nd place in the ranking!

Cryptocurrency Market Outlook; Bitcoin Is Dragging Them All Lower

No Catalysts In Sight; Bitcoin Moves Lower

With no catatlysts in sight it is very likely Bitcoin will move lower. As Bitcoin goes so too does the Crytpocurrency market. Traders need to be prepared for lower prices and I don’t just mean with your bearish positions. The next move lower is going to test key support levels that are going to make or break the market. For Bitcoin, this means a retest of $8000 that may goes as low as $7500. Such a move would sorely test the market but not break BTC/USD out of its current consolidation range. If $7500/$8000 confirms as support the bullish flag pattern that is forming on the weekly chart is still intact.

The indicator set up on the weekly chart gives a clue that makes me at least optimistic key support will hold. The indicators are diverging from the news lows in a way that could result in a strong buy signal. Note I say “could result” that buy signal is not yet present, this set up could also lead the coin lower. It all comes down to support, if the market is as bullish as I am on BTC for the long-term support will kick in. If not, well if not then BTC is likely headed down to $6,000, $5,000, $4,000 and $3,000. A close below $7,500 would be incredibly bearish.

Other coins are moving lower as well. The lack of clear catalyst, the growing number of seemingly indistinguishable coins/token, and a public less than enthusiastic about the what/why/how of it all are all playing a part. Ripple, the so-called answer to cross-border banking, is not immune. The coin has seen some adoption but not the kind to drive up its value. In fact, XRP has fallen below its 30-day moving average and on its way down to $0.24 and $0.22.

Litecoin is also showing some bearish tendencies. It, too, has fallen below the short-term 30-day EMA and looks weak. The indicators are bearish but show oversold conditions so the move may not be too deep when and if it comes. At best, bears can expect to see LTC retreat to support at the $50 level. A move below $50 would be bearish but that is not expected now.

Not surprisingly, the Basic Attention Token is holding up rather well while the broader cryptocurrency market wallows. The Brave Browser now has over 8 million active monthly users and that means demand. BAT tokens have utility over the Brave network because users get paid to see ads, if an advertiser wants to use the network they have to buy the tokens. The BAT token is now testing a four-month high and likely to head higher. Resistance is at the $0.28 level, a break above that would be bullish. Until then, traders should watch for signs of buying at or between $0.26 and $0.24.

Cryptocurrency Outlook 2020: Don’t Expect New All-Time Highs This Year

There’s little chance of any cryptocurrency reaching a new all-time high in 2020. The burst bubble that once brought Bitcoin to within reach of $20,000 and Ethereum to nearly $1500 is a distant memory as Bitcoin hovers around $3,800 while Ethereum trades around $150. It’s simply unreasonable to expect such a massive turnaround in such a short period of time.

Historically, there are a few parallels one can look to for comparison. Bitcoin’s previous bubble—which pushed the digital currency to a peak of $1200 in December 2020 before it fell to $171—took more than 3 years before the cryptocurrency re-inflated to its 2020 all-time high. And that occurred on significant volatility.

In a more traditional example, it took the NASDAQ Composite 15 years to return to the elevated levels it saw before the dot com bubble burst in the early 2000s.

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:

  • BINOMO
    BINOMO

    2nd place in the ranking!

A new all-time high for cryptocurrencies will either occur two-three years from now, when improved technology can deliver on mainstream adoption and daily usability, or when enough new money enters the arena and spurs a new mania for cryptocurrencies.

Fewer ICOs; More Regulation; Greater Cryptosphere Convergence

Deadcoins.com currently lists 934 defunct coins. Some were outright scams, others were hacked and many just died when their funding dried up. Yet others were a bad fit for the market or had ineffective business models.

Investing.com tracks 2533 coins, up from 1300 a year ago. Growth of potential investment opportunities within the asset class has been remarkable, but much like last year’s inflated prices we expect the current number to shrink considerably in 2020.

A lack of investor interest will likely put the kibosh on many new would-be coins. Just as there are fewer initial public offerings (IPOs) when equities are in a bear market, expect fewer initial coin offerings (ICOs) as the crypto bear market lingers. Issuing a new coin in 2020/early 2020 was easy; investors were hungry for the next big thing. But caution is the current watchword.

Dampening ICO prospects yet further, expect much more active regulatory scrutiny in 2020. We briefly discussed some key 2020 rulings in last week’s Cryptocurrency 2020 Year in Review . Most recently, charges were filed by the US Securities and Exchange Commission against Airfox and Paragon for violating securities laws. Nonetheless, it took the SEC a year or so to decide on a course of action.

Still, the regulatory agency appears to have finally charted a course for enforcement. As such, expect more charges against ICOs and exchanges to be leveled in 2020. Of course, this may scare away some ICOs as well as potential investors.

Taking this a step further, it’s highly likely the ongoing crypto bear market will cause investors to converge on more tested, safer coins such as Bitcoin, or even look for a safer haven via US dollars. This will force coin issuers without perfect treasury management to think twice before heading to market since holding a subset of the same coins one is offering is a deadly gamble in a bear market, unless expenses can be met using that cryptocurrency, which usually isn’t the case. More than a few projects—ConsenSys comes to mind—will face the repercussions of failed management in 2020.

A quote attributed to Warren Buffett—who ironically does not like cryptocurrencies—describes the current situation best: “Only when the tide goes out do you discover who’s been swimming naked.” Now that the massive cash inflow that once bathed the entire asset class has receded, it’s become clear what’s working and what’s not.

Crypto ETF In 2020?

The SEC has indicated that it will approve a cryptocurrency financial instrument only when there’s significant evidence that it is virtually impossible to manipulate the asset class and it’s a safe investment for the general public. That means that right now, SEC rules call for much more stability and transparency than the cryptosphere can provide.

Nearly all projects (Bitcoin included) are in the early stages of development, making them less stable than the SEC would wish. As for transparency, one of the central tenets of the asset is privacy, which clashes with the regulatory requirement revealing who the buyers are in order to mitigate manipulation and block money laundering.

Both VanEck and SolidX have proposed over the counter institutional Bitcoin ETFs (which would start at a 25 BTC share size). Each of these seem promising, but there’s still no clear proof they can’t be manipulated. In addition, given Bitcoin’s currently low price (which could still head lower), it could cease qualifying as an institutional ETF, since shares of a few thousand dollars don’t make it ‘investment grade,’ but rather, simply retail.

Positive Developments On The Horizon

Even though crypto prices are trending downward, crypto aficionados have not given up on the asset class. There are still plenty of development teams working to build the necessary infrastructure for cryptocurrencies, which will allow Bitcoin in particular, to thrive. Remember that Bitcoin and its peers are still in their relatively nascent stages. Technological limitations continue to require savvy solutions developed by highly literate techs.

On the user side, Bitcoin payments remain slow, though the Lightning Network has helped facilitate a better rate of performance. As well, solutions such as Casa Hodl and Nodl.it aim to provide fully ready, no-coding-required, Bitcoin full nodes, which are essential to the network. Both efforts are primed to grow massively in the coming years.

There are many teams at work on Ethereum too, including to drive a six phase plan that would create Ethereum 2.0, also known as Serenity. This upgrade, with a planned roll-out set to begin in Q4 2020, includes a move away from the proof of work mining model to proof of stake.

It’s probable that most of these improvements won’t have an impact on crypto markets till 2020 at the earliest. Nonetheless, there is a crypto spring on the horizon.

Cryptocurrency Market Outlook; Ethereum, Ripple, Bitcoin Cash, Litecoin

It’s Not Looking Good, The Market Needs A Catalyst

I just did a quick check of the top-four crytpocurrencies by marketcap that aren’t Bitcoin and I have to tell you, it doesn’t look good. The market appears set to move lower if for no other reason than there isn’t much reason to buy. If there is one thing I hate worse than anything else is an asset that’s moving on an absence of volume. Under these circumstances the prices of Ripple (XRP), Ethereum (ETH), Litecoin (LTC) and Bitcoin Cash (BCH) are unpredictable, there is no telling when some trader somewhere in the world will buy or sell and that could have an exaggerated impact on price action. What I mean is, I wouldn’t be surprised to see a 3%, 5% or 10% move in one or more of these tokens sometime in the near future.

Ethereum, Watch $180 For Your Signal

Ethereum has been in a downtrend since hitting its top in late June. The worlds “most advanced” cryptocurrency is still having trouble getting it’s 2.0 version launched and that is weighing on prices. The coin has made a sharp retreat from a double-top and is now consolidating for what looks like a dip to the $140-$135 level. The key level for traders to watch is $180 where support is currently preventing prices from falling. If the $180 level breaks all those buyers will start becoming sellers and that will fuel a further decline. The indicators are rolling into a bearish signal as I write this, all the coin needs is to follow through on the signal.

XRP, This Chart Is A Short

Of the four charts I viewed today the chart of XRP is the one I want to own the least. In fact, as a trader who normally doesn’t trade bearish, I might short this one because it looks so good. The coin has fallen below a key support level I have been watching for over a year. The price action is forming a little flag pattern that is backed up by the indicators. The indicators are not strongly bearish but they are set up to produce a fairly strong bearish crossover so lower prices are expected. The $0.2362 level is the long-term low and I expect it to be retested. A move below that level would be bearish and take the coin down to new lows.

Litecoin Could Fall Below $70

The Litecoin chart looks equally bearish despite the recent halvening. Traders who’d profited on the way are now taking those profits while they can. The question now is how far will the world’s first and leading Bitcoin offshoot fall before it hits bottom? For now, the coin is consolidating above $70 after having fallen steadily for over two months. The indicators are weak and mixed so there is some support here, if it holds prices may rebound to the short-term EMA, if not a move down to $50 is very possible.

Bitcoin Cash, Uncertainty Is The Only Certainty

I’ll be honest, I don’t really follow BCH that much because I don’t think it matters that much. I mean, we have Bitcoin and Litecoin to choose from already, why do we need another kind of Bitcoin? Regardless, the chart of BCH/USD is one of uncertainty. The price action is wound up in the middle of a wide range with the indicators in support of said range. There is some bearish bias in the indicator but I think support is much stronger than in the other coins I’ve analyzed today.

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Best Binary Options Broker 2020!
    Ideal for beginners!
    Free Demo Account + Free Trading Education!
    Get a Sign-up Bonus:

  • BINOMO
    BINOMO

    2nd place in the ranking!

Like this post? Please share to your friends:
All About Binary Options Trading
Leave a Reply

;-) :| :x :twisted: :smile: :shock: :sad: :roll: :razz: :oops: :o :mrgreen: :lol: :idea: :grin: :evil: :cry: :cool: :arrow: :???: :?: :!: