Bitcoin & Ether Price Analysis: Bitcoin Still Going Strong While Ether Wearies

BTC ETH Price Analysis

Bitcoin and Ethereum continue to push all-time highs (ATHs) by most available metrics: price, market capitalization, daily traded volume, hash rate, transactions per day, etc.

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There appears to be a multifactorial convergence of fundamentals and technicals allowing for this surge to happen:

1. On-ramps

Specifically Coinbase for U.S. citizens, which now allows new users to purchase bitcoin (BTC), ether (ETH) or litecoin. Leading up to and even during the 2013 bubble, purchasing cryptocurrency was difficult for the average user. Know-Your-Customer (KYC) and Anti-Money Laundering (AML) checks cause a slight lag in on-ramping by limiting the total coins a new user can purchase. I expect the fuel for this rally to continue for at least another week.

2. Visibility in mainstream and popular media

At this point, you cannot use any social media or news source without hearing about Bitcoin. Everyone I’ve spoken with outside of the Bitcoinosphere is aware of its existence. Although purely anecdotal, this trend suggests Bitcoin is gaining visibility.  

3. ICOmania

Initial coin offerings (ICOs), similar to IPOs, allow for a company or brand to tokenize its assets through crowdfunding, most of which are done on the Ethereum blockchain. The quantity and rate of new ICOs remind many traders of the dot-com bubble due to large influxes of cash for almost every project.   

4. An agreement on the block size debate

The ongoing block size and scalability debate was stifling innovation surrounding Bitcoin. On Monday, it was announced that Barry Silbert and Bitcoin Unlimited proponents reached an agreement to activate SegWit now and hard fork in four months. Members of the Bitcoin Core community were not involved in the discussion. Shaolinfry, the user-activated soft fork (UASF) dev, had this to say regarding the agreement. UASF nodes continue to increase, despite the agreement.

To be clear, the proposal, as far as I can see, does not activate BIP 141, but is a completely new deployment that would be incompatible with the BIP 141 deployment. I’m not sure how that can be considered “immediate” activation. – Shaolinfry

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5. Prices were already pushing ATHs  

Trend since 2015 has been bullish with several periods of extended consolidation. Price continues to break ATHs in large part due to further bullish technicals and market structure with every pullback/correction. Whether or not current price represents a bubble or euphoria is a bit irrelevant. What is more important is to look for signs of exhaustion. One such sign of exhaustion would be a toppy chart pattern such as an M double top or growing bearish divergence on a weekly chart.

Bitcoin

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A bear div would consist of a higher high in price and a lower high on RSI, a measure of momentum. This would suggest lack of strength holding up price. In the case of BTC, however, there has been a steady increase in volume since the beginning of the year.

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As price continues to break ATHs almost daily, we can expect a large increase in volatility and range expansion, especially because there is no previous market structure at these levels. However, there are indicators that help determine support and resistance levels above ATH levels, the most common being Fibonacci extensions. Drawn from previous ATH to low, this would yield a target of ~$2,400.

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On a low timeframe, you can see yesterday’s $200+ volatility, which quickly rallied 50 percent of the drop.

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The current immediate target is the local top of $2,248.

Ethereum

Ethereum, on the other hand, is beginning to show signs of exhaustion. The weekly chart is showing a decline in volume since March, with ETH/USD pushing the top limit of RSI, and the ETH/BTC pair showing bear div.

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Structure currently has all the makings of an M double top. I would expect another retest of the previous consolidation level before moving higher. if Bitcoin makes a push past $2,400, however, it may drag up Ethereum with it as well.

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The upside target should be between $198 and $217 according to Fibonacci extensions.

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Summary

  1. Bitcoin and Ethereum continue to push the envelope for almost every available metric and show little signs of slowing.

  2. Reliable on-ramping coupled with awareness and popularity continue to fuel demand.

  3. Despite several weeks of large gains, the possibility of continuing to further ATHs for Bitcoin remains high.

  4. With declining volume and a growing bear div on high timeframes, Ethereum is beginning to show signs of slowing.

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Bitcoin Price Analysis: Nearing a Bubble…but We’re Not There Yet

Bitcoin Price Analysis

Bitcoin has now shown about eight weeks of consecutive buying, leading into new all-time highs (ATHs) for the past three weeks. Trying to stay objective with mild to extreme euphoria in times like this can be difficult. As someone who was a new trader during the 2013 bubble, the chart is beginning to look very similar.

Market capitalization and trading volume both on exchanges and over-the-counter markets have hit ATHs as well.

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Despite being in price discovery mode, there is an established, longstanding trend we can compare the current price against, as well as the entire left side of the chart. Past results don’t always predict the future, but they can influence it.

There are a few questions we can investigate:

  1. Is the price near an interim top?

  2. Is the price nearing parabolic conditions?

  3. Will the price continue on the previous trend at the same rate?

Looking at the monthly Bitstamp chart, there have not been too many candles of this proportion. This would suggest we are nearing bubble-like conditions.

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Price has also begun to close outside of the longstanding trend. This weekly candle has not closed yet, but if it does close outside of the diagonal, it will be the first weekly candle to do so. This again points to breaking the trend strongly to the upside.

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Fibonacci retracement and extensions are admittedly partly magic voodoo, but there are plenty of traders who use and watch them to make the resistance and support levels legitimate. Drawing this Fibonacci from the local high established on March 10, 2017, to the low on January 14, 2015, several Fibonacci extensions emerge as well.

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These can be seen as resistance levels, the next being the 1.618 at $2,088. Although the horizontal levels are arbitrary, we can confidently predict resistance based on the fit of the previous horizontals. Most of the prior “Fibs” match the price. This should be seen less as curve fitting and more as levels that just make sense. Based on the Fibonacci levels alone, there is not necessarily evidence for top or bubble just yet.

We can tease apart the trend even further by using the Fibonacci tool on each previous high and low.

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In the trend, a consolidation from the previous high to low has yielded a price that has seen resistance at the 2.272 Fibonacci extension. Currently, the price has exceeded the previous 2.272 Fibonacci extension and shown it was supported based on the multiple candle touches. This suggests price is moving faster than the previous trend as well as closer to bubble-like conditions.

For low-timeframe, intra-day trading, there was a long entry signal when the price cleanly broke the consolidation triangle. On the next correction, pullback or consolidation event, I’d expect the support diagonal (green) to remain the same.

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Remember that splashy gold parity headline? BTC is now sitting several hundred dollars above it.

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Summary

  1. Bitcoin is making ATHs by almost every available metric: price, market capitalization, volume, hashrate, difficulty and fee per transaction.

  2. Although $2,000 is the next milestone and resistance target, the price will likely exceed that level based on the strength and rate at which the price is exceeding current trends.

  3. Watch for signs of a large pullback or correction in the near future, two to three months at the latest, based on previous price history.

Trading and investing in digital assets like bitcoin is highly speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTCMedia related sites do not necessarily reflect the opinion of BTCMedia and should not be construed as an endorsement or recommendation to buy, sell or hold. Past performance is not necessarily indicative of future results.

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Bitcoin Price Analysis: Outlook Not as Bearish as It Seems

Bitcoin Price Analysis

Much of the world has now heard about Bitcoin due to the global WanaCrypt0r 2.0 ransomware, which should continue spreading over the course of next week. Optics for Bitcoin aren’t great in situations like this because it furthers the notion that Bitcoin is used for nefarious means. You can follow a live feed of the incoming transactions from this twitter bot. However, the silver lining is that many people who did not know what Bitcoin is or how to use it before the attack certainly do now.

Worst-case scenario for Bitcoin here would be a government crackdown on its use and distribution, which, although a low probability, is probably not a non-zero possibility considering the current administration. This would create a large down day in the market similar to when Silk Road was shut down, Mt. Gox was found to be insolvent and Bitfinex was hacked. Of course, Bitcoin the protocol would be unaffected, so the price is likely to bounce back rather quickly.

The block size and scalability debate trickles on with no current end or resolution in sight. I wouldn’t really expect a push out of the SegWit camp until October or November, when the Bitcoin Improvement Proposal (BIP) is set to be tabled for the time being. The number of unconfirmed transactions continues to rise on an upward trend, all the while miners who support Bitcoin Unlimited are mining empty or non-full blocks.

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The COIN ETF comment period closed yesterday, which isn’t to say there will be any type of decision on the SEC’s part. This will likely be a non-event for the market considering the ETF itself will remain in limbo until further notice.

Total cryptocurrency market capitalization broke a new all-time high (ATH) of $55 billionearlier this week, while Bitcoin dropped just shy of 50 percent of that total.

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Some may view this as Bitcoin losing its impact and success, which can be partially attributed to the block size and scalability in-fighting. Others, like myself, view this shift as a massive altcoin bubble. Hockey stick parabolic curves on a chart like that end with large selloff candles. There is also only one Bitcoin, with a fixed supply, competing against an infinite number of altcoins, many with pre-mined or infinite supply as well.

Because of the correction late in the week, the weekly candle was threatening a bearish close with a wick longer than the candle body, but the heavy buying on Sunday prevented the bearish close.

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This weekly close alone suggests continuation over reversal or sideways movement in price. Since the beginning of the trend, duration of consolidation between large upward moves has decreased. This will eventually lead to a parabolic, euphoric, blowoff top with a massive candle wick. Until then, expect more of the same. A small correction this week would just mean an even greater chance for extended continuation.

Bitcoin did make a new high this week of $1,868.50, according to index, and is currently drawing an “M for murder” double top. This likely represents consolidation to a further move upward and not exhaustion of trend.

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This is the only chart I’m really focused on at the moment. There are plenty of potential patterns, such as head and shoulders or Adam and Eve, harmonics, and horizontal support levels here, but all that really matters is the larger consolidation pattern.

This may also represent a flag/pennant, which is another sign of bullish continuation.

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A more ominous double top for a bull market would have similar price structure to the pattern that formed during the ATH of 2013.

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As discussed above, a serious threat of reversal shows large candle wicks on high timeframes, which is not currently the case with price structure.

Summary

  1. Most of the world is now aware of Bitcoin due to the WanaCrypt0r 2.0 ransomware.

  2. The block size and scalability debate continues with large transaction backlogs in an upward trend.

  3. Based on market capitalization, Bitcoin is currently hovering around 50 percent of the total.

  4. Price remains in consolidation; once finished, expect a return to the status quo.

Trading and investing in digital assets like bitcoin is highly speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTCMedia related sites do not necessarily reflect the opinion of BTCMedia and should not be construed as an endorsement or recommendation to buy, sell or hold. Past performance is not necessarily indicative of future results.

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Ether Price Analysis: Bullish Outlook Continues As Resistance Levels Hold

Ether Price Analysis

As Bitcoin continues its bull run, the top alts by market capitalization have also made strides of their own. Ripple shot to new all-time highs (ATHs) this week and Litecoin has now activated SegWit, a block size and scalability protocol change. Litecoin will continue to receive further protocol upgrades made possible through SegWit activation. Ethereum is due for a protocol change, Metropolis, in the form of a hard fork sometime later this year. From a user standpoint, a competitive protocol change and upgrade environment with active developers amongst the top coins ensure these technologies will continue to push the limits of finance and beyond.

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Despite showing some signs of slowing last week, Ethereum continues to break hash rate ATHs, now at almost 25,000 GH/s, suggesting that miner confidence in the future of Ethereum remains strong.

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GDAX continues to take the lion’s share of volume, suggesting that USD fiat on-ramping remains strong. Bitfinex also continues to sit slightly higher in price than the other exchanges due to ongoing USD deposit and withdrawal issues.

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Ethereum has had two recent chart patterns that failed to complete to their respective targets, seen here on the four-hour timeframe.

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There was a large bearish formation, head and shoulders, which failed to break below the 200 EMA despite having the matching volume profile. Most recently, there was a bullish continuation pattern, cup and handle, which failed to cleanly break horizontal resistance with volume. For determination of trend, the position of price relative to the 200 EMA is the gold standard. Despite two failed chart patterns, trend remains bullish while above the 200 EMA. A break of this range with volume should be the deciding factor for direction.

The daily timeframe is also showing no threat to trend with the most recent pullback due to a bearish divergence, measured from RSI, a momentum oscillator. While hindsight now, this is the type of structure — higher high in price and lower high in momentum — to identify before the price reversals occur. RSI has also reset to around 50, which usually suggests continuation of trend after correction.

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On the 30-minute timeframe, there is an active bullish reversal chart pattern known as the Adam and Eve double bottom. The Adam, a steep V, and Eve, a gentle U, is a very common fractal pattern when solid support has formed. The measured move for resolution is the distance from horizontal resistance to the bottom of support, projected upward, which yields a target of ~$100 (0.0572).

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This horizontal resistance is also a key zone that broke upward previously after a triangle consolidation.

Summary

  1. The competitive development milieu for the top cryptocurrencies is important to ensuring a healthy user experience.

  2. Hash rate suggests continued miner belief in the strong future of Ethereum.

  3. Although range-bound after two large but failed chart patterns, trend remains bullish.

  4. A low-timeframe double bottom pattern suggests support has formed and price will shortly return to the top of the range. 

Trading and investing in digital assets is highly speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTCMedia related sites do not necessarily reflect the opinion of BTCMedia and should not be construed as an endorsement or recommendation to buy, sell or hold. Past performance is not necessarily indicative of future results. 

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Bitcoin Price Analysis: $1700 and Rising (But So Are Fees)

Bitcoin Price Analysis

With bitcoin making new all-time highs (ATHs) in price and market capitalization almost every day, the block size and scalability debate has taken a back seat over the past week. From a user perspective, unconfirmed transactions are on the rise due to a clogged and busy network. Without any changes to the Bitcoin protocol, this will not improve, especially if bitcoin continues to push higher on heavy demand.

The number of unconfirmed transactions hit an ATH of 140,000 on May 5. Although this isn’t the best metric to evaluate health of the network because large numbers of spam transactions can inflate this number, it does give a user an indication of how quickly or slowly they will receive their bitcoin. To determine the optimal fee that will give your transaction a chance to be processed in a reasonable time, it’s a good idea to use a wallet that will calculate this for you. Alternatively, you can reference a website. At the current rate, microtransactions are not exactly feasible due to high transaction costs.


Here are some tips for what to do if your transaction gets stuck.


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Prices and premiums between the various USD exchanges have been fluctuating wildly, with GDAX and Bitfinex often leading in price.

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No amendments have been made to the COIN ETF since the SEC’s review of rejection, but this will be something to keep a close eye on since it could spark a media frenzy and drive price higher. GBTC, an OTC market that uses a BTC derivative available to the public, hit a new ATH of $2,000 per bitcoin yesterday, or a $200+ premium from the current spot price. We can expect this premium to shrink to $0 if the COIN ETF gets approved, as those same investors would likely move toward that market.

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With prices this high, getting close to parabolic movement, it’s hard to estimate targets or true resistance in price discovery mode. Even a price target of $4,000 isn’t exactly impossible. The inverted head and shoulders that confirmed a few weeks ago hit its measured target of $1,575.

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A slightly modified pitchfork yields targets around $1,800–2,000, with price recently breaking the resistance diagonal rather cleanly.

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Heikin-Ashi candlesticks on the daily timeframe continue to show strong bullish momentum despite volume or oscillators suggesting otherwise. Typically, a Heikin-Ashi run like this will end in a blow-off top, similar to the price structure of January 4 and 5, as well as November 2015 (not shown).

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Summary

  1. Unconfirmed transactions will continue to plague Bitcoin, especially as new users and traders ramp onto the network. Stuck transactions can be avoided by using an appropriate transaction fee.

  2. The Bitfinex premium in excess of $100 at one point between exchanges continues to shrink.

  3. Most technicals are of little use with this price structure and discovery, although a large parabolic move is likely coming in the very near future.

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Ether Price Update: Technicals Indicate $100 ETH Is Within Reach

Ether Price Analysis

Despite a recent correction and profit-taking with bitcoin, the top five coins by market capitalization continue showing extremely strong gains. Ether (ETH) has risen over 100% since April 24th and has made new all-time highs (ATH) in market capitalization every day.

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Hash rate however has slowed slightly, currently sitting near its ATH.

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Based on inflation, Ethereum needs a significant infusion of cash per day to keep up with block rewards to remain at its current price. This could be some cause for concern for long-term holders of ETH.

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GDAX continues to handedly lead the ETH-USD volume, suggesting on-ramping remains strong. The GDAX price has also begun closing in on the Bitfinex premium, which remains in place due to USD deposit and withdrawal halt on that exchange.

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There is an active and near-complete bullish chart pattern, the Cup and Handle.

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The chart pattern includes a matching descending volume profile for the cup as well as the handle. A resolution of the diagonal resistance should yield a break of the local high on volume. The measured move is ~$129.35 (0.0812) and the Fibonacci extension is ~$119.47 (0.075). The pattern has broken the resistance and is retesting this zone to confirm support. This is not uncommon and is known as a throwback. The stop for this trade would be a candle close on this timeframe below the tip of the handle.

Non-conservative Fibonacci Extensions from extreme low to previous high yield similar targets.

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Generally, I have mixed feelings trading small timeframes like the 15 minute, but when taking into account a large amount of data, some patterns and entries become more obvious.

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Using the 50/200 EMA, you can see an excellent EMA cross entry based on April 26th, which later recrosses as a close signal on May 1st. Depending on how you play stops, such as price breaking the 200 EMA, this trade would have closed sooner. Then, as the 50/200 EMA cross remains bearish, price builds a triangle which breaks just before the 50/200 EMA cross. I would look for similar conditions for a long exit and re-entry within the next few days, should the 50/200 EMA cross bearish again.  

Summary

  1. Ethereum continues to make massive gains with no sign of stopping.

  2. Technicals continue to show high probability for $100+ Ethereum.

  3. Using low timeframes for signals is generally a fool’s errand unless you take into account a large amount of data to better understand price structure.

Trading and investing in digital assets like bitcoin is highly speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTCMedia related sites do not necessarily reflect the opinion of BTCMedia and should not be construed as an endorsement or recommendation to buy, sell or hold. Past performance is not necessarily indicative of future results.

The post Ether Price Update: Technicals Indicate $100 ETH Is Within Reach appeared first on Bitcoin Magazine.

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Ether Price Update: Technicals Indicate $100 ETH Is Within Reach

Ether Price Analysis

Despite a recent correction and profit-taking with bitcoin, the top five coins by market capitalization continue showing extremely strong gains. Ether (ETH) has risen over 100% since April 24th and has made new all-time highs (ATH) in market capitalization every day.

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Hash rate however has slowed slightly, currently sitting near its ATH.

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Based on inflation, Ethereum needs a significant infusion of cash per day to keep up with block rewards to remain at its current price. This could be some cause for concern for long-term holders of ETH.

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GDAX continues to handedly lead the ETH-USD volume, suggesting on-ramping remains strong. The GDAX price has also begun closing in on the Bitfinex premium, which remains in place due to USD deposit and withdrawal halt on that exchange.

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There is an active and near-complete bullish chart pattern, the Cup and Handle.

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The chart pattern includes a matching descending volume profile for the cup as well as the handle. A resolution of the diagonal resistance should yield a break of the local high on volume. The measured move is ~$129.35 (0.0812) and the Fibonacci extension is ~$119.47 (0.075). The pattern has broken the resistance and is retesting this zone to confirm support. This is not uncommon and is known as a throwback. The stop for this trade would be a candle close on this timeframe below the tip of the handle.

Non-conservative Fibonacci Extensions from extreme low to previous high yield similar targets.

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Generally, I have mixed feelings trading small timeframes like the 15 minute, but when taking into account a large amount of data, some patterns and entries become more obvious.

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Using the 50/200 EMA, you can see an excellent EMA cross entry based on April 26th, which later recrosses as a close signal on May 1st. Depending on how you play stops, such as price breaking the 200 EMA, this trade would have closed sooner. Then, as the 50/200 EMA cross remains bearish, price builds a triangle which breaks just before the 50/200 EMA cross. I would look for similar conditions for a long exit and re-entry within the next few days, should the 50/200 EMA cross bearish again.  

Summary

  1. Ethereum continues to make massive gains with no sign of stopping.

  2. Technicals continue to show high probability for $100+ Ethereum.

  3. Using low timeframes for signals is generally a fool’s errand unless you take into account a large amount of data to better understand price structure.

Trading and investing in digital assets like bitcoin is highly speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTCMedia related sites do not necessarily reflect the opinion of BTCMedia and should not be construed as an endorsement or recommendation to buy, sell or hold. Past performance is not necessarily indicative of future results.

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