A popular crypto analyst and trader is warning his followers that Ethereum (ETH) could suffer a nearly 45% drop if current support breaks. Cryptocademy founder Justin Bennett tells his 108,500 Twitter followers that ETH is testing the “neckline” on a possible head and shoulders trend. “ETH is testing the neckline. The target is $800 if this breaks.” […]
The post Top Crypto Trader Sees Ethereum (ETH) and Total Market Cap Testing Support, Issues Warning on Stocks appeared first on The Daily Hodl.
Equities markets are witnessing aggressive selling due to increasingly bearish macroeconomic factors, and this is adding sell pressure to Bitcoin and altcoin prices.
The World Bank has warned of a possible global recession in 2023. In a press release on Sept. 15, the bank said that the current pace of rate hikes and policy decisions is unlikely to be enough to bring inflation down to pre-pandemic levels.
Ray Dalio, the billionaire founder of Bridgewater Associates said in a blog post on Sept. 13 that if rates were to rise to about 4.5% in the United States, it would “produce about a 20 percent negative impact on equity prices.”
The negative outlook for the equity markets does not bode well for the cryptocurrency markets as both have been closely correlated in 2022.
The macroeconomic developments seem to be worrying cryptocurrency investors who sent 236,000 Bitcoin (BTC) to major cryptocurrency exchanges on Sept. 14, according to Glassnode data. The inflow was the highest since March 2020.
Let’s study the charts of the S&P 500 index, the U.S. dollar index (DXY) and the major cryptocurrencies to determine the key levels that could signal the start of a trending move.
The S&P 500 index (SPX) attempted a rebound off the uptrend line on Sept. 14 but the weak rebound showed a lack of urgency to defend the level. Sellers took advantage of this situation and pulled the price below the uptrend line on Sept. 15.
The level of 3,886 from where the index had bounced on Sept. 6 also failed to provide any support, indicating that traders are in a hurry to sell their positions. Usually, the breakdown from a level tends to retest it.
In this case, the price could rise to the uptrend line. If the price turns down from this level, it will suggest that bears have flipped the uptrend line into resistance. That could increase the possibility of a drop to 3,700.
The downsloping 20-day exponential moving average (EMA) (4,006) and the relative strength index below 37 suggest that bears are in command.
If the price turns up and rises above the uptrend line, it will suggest that the breakdown on Sept. 15 may have been a bear trap. That could propel the index to the downtrend line.
The DXY is in a strong uptrend. The bears tried to pull the price below the moving averages but the bulls vigorously defended the 50-day simple moving average (SMA(107) on Sept. 13.
Both moving averages are sloping up and the RSI is in the positive territory indicating advantage to buyers. The bulls will next attempt to push the price above the overhead resistance at 110.78. This is an important level to keep an eye on because if the price sustains above this level, the rally could extend to 115.
If the price turns down from the current level or the overhead resistance and breaks below the 20-day EMA (109), it will suggest a consolidation in the near term. The price could then range between 107.58 and 110.78 for a few days. A potential trend change could be signaled if bears sink the price below 107.58.
Bitcoin formed a Doji candlestick pattern on Sept. 14, indicating indecision among the bulls and the bears. The uncertainty resolved to the downside on Sept. 15 but the bears have failed to build upon this advantage. This indicates that the selling pressure reduces at lower levels.
Buyers will attempt to salvage the situation by pushing the price above the 20-day EMA ($20,529). If that happens, the BTC/USDT pair could rise to the overhead resistance at $22,799. The bears may defend this level aggressively but if bulls thrust the price above it, the pair could rally to $25,211.
Contrarily, if the price turns down from the current level or the 20-day EMA, it will suggest that the sentiment remains negative and traders are viewing rallies as a selling opportunity. That could sink the pair to the strong support at $18,510. The zone between $18,510 and $17,622 could witness aggressive buying from the bulls because the failure to defend this zone may start the next leg of the downtrend.
Ether (ETH) bounced off the support line on Sept. 14 but the joy of the bulls proved to be short-lived. The price turned down sharply from the 20-day EMA ($1,609) and plunged below the support line on Sept. 15.
The 20-day EMA has started to turn down and the RSI has slipped below 39, indicating that bears are in control. The sellers have pulled the price to $1,422 and if this support cracks, the ETH/USDT pair could drop to $1,280.
If the price turns up from the current level, the pair could recover to the moving averages, which may act as a strong resistance. The bulls will have to clear this hurdle to suggest that the selling pressure could be reducing.
The bears pulled BNB below the immediate support at $275 but they are struggling to keep the price down. This indicates that lower levels are attracting buyers.
If the price sustains above $275, the BNB/USDT pair could be in the early stages of forming a symmetrical triangle. This suggests uncertainty about the next directional move among the bulls and the bears. That could keep the price inside the triangle for some time.
If the price rises above the 20-day EMA ($283), the pair could rally to the resistance line of the triangle. A break above the triangle could push the pair to $338.
Another possibility is that the price turns down from the 20-day EMA and plummets below the support line of the triangle. That could start a decline to $258 and later to $239.
Ripple (XRP) has been range-bound between $0.30 and $0.39 for the past several weeks. In the past few days, the range has shrunk further with bulls buying the dips to $0.32 and bears selling the recovery to the 50-day SMA ($0.35).
The price action inside a range is usually volatile and difficult to call. Still, as the buyers had successfully defended the $0.32 support between Aug. 28 and Sept. 7, they will again try to do that. If the price rises from the current level, the XRP/USDT pair could rally to the 20-day EMA ($0.34) and later to the 50-day SMA.
If bulls drive the price above the 50-day SMA, the likelihood of a rally to $0.39 increases. The bears are expected to defend this level aggressively. On the downside, if the price slips below $0.32, the crucial support of $0.30 may be retested.
The bears are attempting to build upon their advantage in Cardano (ADA). They sold the recovery to the 20-day EMA ($0.48) on Sept. 14 and are trying to pull the price below the immediate support at $0.45.
Although moving averages are not a valuable tool in a ranging market, they tend to be helpful to determine the short-term trend. The 20-day EMA has started to turn down and the RSI is in the negative territory, indicating advantage to bears. If the price slips and sustains below $0.45, the ADA/USDT pair could drop to $0.42.
If bulls want to gain the upper hand, they will have to arrest the decline and push the price above the moving averages. That could clear the path for a rally to the downtrend line. A break above this resistance could indicate that the bulls are back in the driver’s seat.
Related: Does Ethereum's new ETHPoW fork stand a chance? ETHW price falls 65% post-Merge
Solana (SOL) turned down from the 20-day EMA ($33.84) on Sept. 15, indicating that the sentiment remains negative and bears are selling on minor rallies.
The SOL/USDT pair could decline to the strong support at $30. This level was resilient during the onslaught between Aug. 28 and Sept. 7 and gave a bounce to $39 on Sept. 13. Short-term traders may again expect a bounce off $30 and are likely to buy the dips to this level.
The rebound off the support could continue to face hurdles at the 20-day EMA and then again at the 50-day SMA ($36.95). If the price closes above this resistance, it could open the doors for a possible up-move to $48. Conversely, if the $30 level cracks, the pair could slide to the vital support at $26.
Dogecoin (DOGE) has continued its slide and is near the strong support of $0.06. The price rebounded off this level on Sept. 7; hence, it may again attract buyers.
A break and close above the 20-day EMA ($0.06) will be the first sign of demand building up at higher levels. The DOGE/USDT pair could then rise to $0.07. This level may again act as a resistance but if bulls push the price above it, the pair could rise to $0.08 and thereafter to $0.09.
If the price slips below the immediate support at $0.06, the pair could slide to the June low near $0.05. The bears will have to sink and sustain the price below this level to signal the start of the next leg of the downtrend. The pair could then extend the decline to $0.04.
The bulls attempted to start arecovery on Sept. 14 but higher levels attracted selling by the bears. Polkadot (DOT) turned down on Sept. 15 and the bears are trying to sink the price below the immediate support of $6.75.
Buyers had successfully defended the $6.75 level on two previous occasions; hence, a break and close below it may intensify selling. The DOT/USDT pair could first drop to $6.50 and later to the crucial support at $6.
As the previous three recoveries have turned down from the 50-day SMA ($7.86), it remains the key level to watch out for on the upside. The bulls will have to overcome this barrier to start a rally to $9.17 and then to $10.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
Jeremy Grantham, the co-founder of the Boston-based asset management firm Grantham, Mayo, & van Otterloo (GMO) believes Standard and Poor’s 500 (S&P 500) could drop another 26% during the next 12 months, according to statements the veteran investor made last week. The GMO co-founder detailed his bearish sentiment by mentioning he’s shorting junk bonds and […]
Wall Street’s major indexes closed the day in red on Tuesday, alongside cryptocurrencies, and precious metals like gold and silver taking some percentage losses. The leading crypto asset bitcoin dropped 5.87% under the $19K region, while the second largest crypto asset ethereum shed 8.7%. Gold’s nominal U.S. dollar value per troy ounce slipped by 0.50%, […]
A leading crypto trader says Bitcoin (BTC), Ethereum (ETH) and other top digital assets are showing signs of continued growth in the short term. Crypto analyst Justin Bennett tells his 107,300 Twitter followers to expect volatility today due to non-farm payrolls, a measure of the US economy’s strength excluding proprietors, private household employees, unpaid volunteers, farm […]
The post Crypto Analyst Justin Bennett Predicts Imminent Bitcoin (BTC) and Crypto Bounce – Here’s Why appeared first on The Daily Hodl.
A closely followed crypto analyst is warning investors to avoid getting overly excited after the markets bounced off a flash crash during the weekend. In a series of posts, Justin Bennett tells his 107,100 Twitter followers that he expects crypto prices will continue to fall, noting that the recent recovery could be a bull trap […]
The post Popular Analyst Justin Bennett Says Latest Crypto Bump Is a Bull Trap – Here’s Why appeared first on The Daily Hodl.
Following Jerome Powell’s hawkish commentary at the annual Jackson Hole Economic Symposium, major stock indexes, cryptocurrencies, and precious metals slid significantly in value. Over $240 billion was erased from the crypto market and the Crypto Fear and Greed Index continues to slide lower, edging toward “extreme fear.” Furthermore, the chief strategist at bubbatrading.com, Todd ‘Bubba’ […]
Bitcoin has closed its previous five months of September in losses and could suffer similar pains if history repeats.
Bitcoin (BTC) bulls should not get excited about the recovery from the June lows of $17,500 just yet as BTC heads into its riskiest month in the coming days.
Historic data shows September being Bitcoin's most worst month between 2013 and 2021, except in 2015 and 2016. At the same time, the average Bitcoin price decline in the month is a modest -6%.
Interestingly, Bitcoin's poor track record across the previous September months coincides with similar downturns in the stock market. For instance, the average decline of the U.S. benchmark S&P 500 in September is 0.7% in the last 25 years.
Traditional chart analysts have dubbed this annual drop-off as the "September effect."
Analysts argue that investors exit their market positions after returning from their summer vacations in September to lock gains, or even tax losses, ahead of the year's close.
Meanwhile, they also note that individual investors liquidate their assets in September to pay for their children's annual school costs.
Bitcoin's correlation with the stock market has been largely positive during and after the coronavirus pandemic. Therefore, in addition to the September effect, these mirroring price trends could also increase BTC's likelihood of dropping high in the ominous month.
So expect low volume, chop & random violent moves in either direction. The point of this post isn't to fearmonger anyone. Always a green markets somewhere. I'm sharing insight on what to expect to save newer retail traders from excruciating pain. Be patient and embrace the suck
— Seven V. Matos (@Sevenvmx) August 22, 2022
Bitcoin's losses in 2022 were drawn from fears of the Federal Reserve's rate hikes and the complete unwinding of its $120 billion monthly bond-buying plan to tackle rising inflation.
But the market's narrative shifted to hopes that inflation had peaked. The belief strengthened after the July U.S. consumer price index (CPI) came at 8.5% versus 9.1% in the month prior, leading to speculations that the Fed would tone down its tightening plans.
It coincided with Bitcoin and S&P 500 recouping small portions of their yearly losses, as illustrated below.
But several analysts believe that Bitcoin's recovery could be a bull trap, a "relief rally" that will trap investors who think the market has bottomed.
The psychology of a relief rally
— Lark Davis (@TheCryptoLark) August 22, 2022
Price gets just bullish enough to fool you that this rally is the real deal.
There could be an end to the pain.
Then BLAMO, the market rugs you shattering your hopes.
Expect this a few more times during the bear!#bitcoin #crypto
Moreover, most Fed officials still favor raising by 75 basis points at their next meeting in September, given their pledge to bring inflation down to 2%.
Related: Wen moon? Probably not soon: Why Bitcoin traders should make friends with the trend
As a result, Bitcoin and S&P 500 risk continuing their prevailing correction trend in September, eyeing more yearly lows.
From a technical perspective, Bitcoin will decline toward $19,250 by September if it breaks out of its current "bear flag" pattern. The bearish continuation setup is illustrated in the four-hour chart below.
Meanwhile, on the daily chart, BTC has been breaking down from its rising wedge pattern since Aug. 19. The bearish reversal setup's profit target comes to be near $17,600, as illustrated in the chart below.
Overall, September looks like it could once again be a red month for Bitcoin based on technical, fundamental and macro factors.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
SOL price gained 75% in the past two months, but technical analysis suggests it could be an elaborate bull trap.
Solana (SOL) price rallied by approximately 75% two months after bottoming out locally near $25.75, but the token's splendid upside move is at risk of a complete wipeout due to an ominous bearish technical indicator.
Dubbed a "head-and-shoulders (H&S)," the pattern appears when the price forms three consecutive peaks atop a common resistance level (called the neckline). Notably, the middle peak (head) comes to be higher than the other two shoulders, which are of almost equal height.
Head and shoulders patterns resolve after the price breaks below their neckline. In doing so, the price falls by as much as the distance between the head's peak and the neckline when measured from the breakdown point, per a rule of technical analysis.
It appears SOL has been forming a similar bearish setup on its longer-timeframe charts.
On the weekly chart, the token has been forming the right shoulder of the overall pattern, suggesting a correction toward the neckline at $27 during the second half of 2022. Meanwhile, a breakdown below $27 could result in an extended correction toward $2.80.
In other words, a 95% price decline by the end of 2022 or early 2023, a setup also projected by pseudonymous analyst "PROFIT BLUE."
I will leave this here, now that it looks better.. #Solana pic.twitter.com/w03Y4Ffl8o
— PROFIT BLUE (@profit8lue) August 14, 2022
Solana's extremely eerie bearish setup appears as it closely tails trends across risk-on markets, mainly driven by the Federal Reserve's hawkish response to inflationary pressures.
For instance, SOL closed the week ending Aug. 14 at a 10.5% profit, similar to Bitcoin (BTC) and the benchmark S&P 500 index. These markets reacted to a softer-than-anticipated U.S. consumer price index (CPI), raising possibilities that the Fed would slow the pace of its interest rate hikes.
But many analysts have warned about these ongoing price rallies in the risky corners of the market, citing pieces of historical evidence of similar bear market bounces. So, SOL's 75% rebound risks turn into a fakeout if its correlation with riskier assets remains positive.
From a fundamental perspective, Solana also faces extreme FUD due to its recurring network outages and rumored centralization. However, the project's backers have introduced new upgrades to fix these issues, as Cointelegraph discussed.
But even then, a 95% price crash is too "wild," suggests market analyst IncomeSharks, saying that it would mean Solana is a rug pull project like Terra (LUNA) — now Terra Classic (LUNC).
Related: Fallout from crypto contagion subsides but no market reversal just yet
The next big drop could have SOL explore bounce opportunities near a multi-year ascending support trendline, as shown below.
In other words, SOL's bearish continuation could last until its price hits $20, down over 55% from August 16's price.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Stock and cryptocurrency markets on Thursday saw volatility, after experiencing fluctuations during the tensions between China and Taiwan on Tuesday and Wednesday. Major indexes like the S&P 500, Dow Jones, and NYSE have shed a few percentages today, while the global cryptocurrency market capitalization lost 2.5% in 24 hours, dropping to just above the $1.1 […]