Connect with us

Blogs

Ethereum (ETH), Like Most Cryptos, Enters Consolidation Mode

Published

on

READ LATER - DOWNLOAD THIS POST AS PDF

Ethereum (ETH), like most crypto assets, is currently consolidating. There is little fundamental news driving prices at present and the best option for traders is to use short-term price levels to initiate short-term positions.

Fundamental Analysis

While there are several ongoing stories about Ethereum, none of them are currently driving the price.

The ICO market has seen a recovery in May, which is helping to support the ETH price. Successful ICOs on the Ethereum blockchain attract more ICOs, which in turn drives demand for ETH tokens. However, increasing numbers of blockchain projects hold ETH on their balance sheets. They need to sell these to release working capital, and in the case of a downturn in the ETH price, there is a risk of these companies liquidating their ETH holdings. This dynamic is sure to lead to continued volatility in the price of Ether.

While there have been no major announcements with regard to addressing the scalability of Ethereum, scalability is also not currently a problem.

Ongoing debates in the US over whether or not Ethereum is a security or a commodity are actually more likely to have implications for other coins than for ETH itself.

Technical Analysis

With few fundamental drivers to go on, investors and traders alike need to focus on the price action. The largest 5 cryptocurrencies have been very highly correlated since March – most of them put in a low on 6th April and a high on 6th May. Any significant moves are therefore likely to occur across the board.

The high correlation means that for longer-term positions, traders should look for confirmation from BTC, LTC, and BCH before initiating positions in Ethereum.

Ethereum 4 Hour Chart (Image Credit: www.tradingview.com)

For short-term positions, there are two levels to watch. The down sloping resistance line going back 10 days, has been rejected four times. Resistance is now at $715, and if this level is broken a rapid move to $760 and possibly $820 would follow.

The support line has been very sharply rejected five times, suggesting very little selling at these levels. This support level is now at $650 and would be a good level for long-term bulls to accumulate. However, a break below this level would suggest a move back to $500, and possibly even $365.

Ethereum vs Bitcoin Weekly Chart (Image Credit:www.tradingview.com)

As far as the relative performance of ETH and BTC is concerned, if history is to repeat itself we may only see another week or two of ETH outperformance before we see a sharp reversal. If the above pattern was to hold it would imply an average long-term ratio of 0.07 BTC per ETH. Alternatively, if the ratio breaks out of the pattern we could see a much longer period of outperformance.

Conclusion

The next move for Ethereum, like most other cryptocurrencies, is unclear at present. After a large three to four-month correction, we saw a one-month rally followed by another smaller correction. Most crypto assets are now consolidating – Ethereum included.

For now, traders can look for short-term trades around the levels mentioned above, or use the volatility to build longer-term positions. It must be said, however, that the long-term picture is far from clear at present.

This article was written by FX Empire.

Altcoins

Cryptocurrency Collateralized Debt Positions Are Growing in Popularity

Published

on

collateralized debt position
READ LATER - DOWNLOAD THIS POST AS PDF

While Bitcoin (BTC) continues to hover around the magical 10,000 price level, altcoins continue to fight an uphill battle.  Simply put, hopes of a future bull run continue to diminish as Bitcoin maintains its dominance.  One school of thought is that a few altcoins will survive and flourish, but which ones are anyone’s guess.  That being said, it’s hard to go wrong picking against the top coins like Ethereum (ETH), Ripple (XRP), Litecoin (LTC), and EOS.  These projects have managed to find a foothold in the market and have a better chance than most of staying there.  While traders wait for their positions to increase in value, one opportunity that may be worth looking at is initiating a collateralized debt position.

What is a Cryptocurrency CDP?

In traditional terms, a CDP is essentially putting up collateral in order to receive a loan against the deposited amount.  There are several examples of this in our day to day lives.  Auto title loans from large companies like TitleMax are extremely popular with consumers.  Consumers are essentially able to use their car as collateral in exchange for a cash payment which can then be used for whatever needs the consumer has.  The consumer can continue using their car as long as debt payments are made.

The same concept applies to cryptocurrency CDPs.  Consumers are able to put up crypto tokens, such as…

Continue Reading

Altcoins

Hodium Presents a Compelling Opportunity for Outsized Investment Returns

Published

on

Hodium
READ LATER - DOWNLOAD THIS POST AS PDF

I’m sure all of us remember the cryptocurrency glory days of 2017 and early 2018.  It was one of the biggest bull runs in history and created incredibly wealth for quite a few early entrants.  Unfortunately, for most of us, those gains have most likely been wiped out during the altcoin apocalypse.  The truth is that traders probably thought a bit too highly of their trading abilities when the reality was that anyone could have thrown a dart at a board and ended up making money.

As markets mature (and the crypto market is definitely maturing) it becomes more and more difficult to generate alpha.  In that regard, it’s similar to traditional financial markets.  I can remember trading during my high school days.  It was the late 90s and right in the middle of the dot.com boom.  Eventually, however, the euphoria fades away and reality hits hard.  Now, it’s become rather difficult to actually trade profitably which has given way to the rise of hedge funds.

Hedge funds are investment funds that pool capital from accredited and/or institutional investors and invest in a variety of assets, often with extremely complex portfolio-construction and risk management techniques.  The professionals employed by hedge funds are the best of the best and have spent years honing their craft.  That is why they’re able to make the millions of dollars that they normally…

Continue Reading

Altcoins

KaratGold Proves Its Business Model By Providing Official Documents

Published

on

READ LATER - DOWNLOAD THIS POST AS PDF

There has been a lot of renewed enthusiasm in the cryptocurrency market thanks mainly to Bitcoin’s strong move about 10,000.  Although Bitcoin continues to show its dominance, the altcoin market has yet to benefit from that rally.  A few of the largest altcoins remain popular but the rest of the market continues to lag behind.  In 2018, there was a lot of talk regarding a possible altcoin apocalypse where only the strong would survive.  That prediction appears to be playing out as expected.  Going forward, only the best projects that have a real world need will survive.  Crypto traders will have to spend a lot of their time doing proper research in order to find the best opportunities, just like in all financial markets.  One promising project that appears to have the makings of a future winner is KaratGold Coin.

KaratGold Background

KaratGold Coin is a cryptocurrency developed by the reputable German company Karatbars International, which maintains a leading position in the market of small gold items and investments. The project is part of a larger ecosystem, which involves several blockchain solutions that can be used for transactions, communication, investing and other tasks. During the past few weeks, however, the KaratGold ecosystem has been a target of unsavory scam allegations.  

Karatbars International and GSB Gold Standard Banking Corporation…

Continue Reading

Elite