Investors are beginning to worry that Bitcoin’s (BTC) uptrend could be in peril after the top-ranked cryptocurrency failed to pull above the $40,000. Some traders are afraid that a repeat of the crushing 2018 bear market is on the cards again if BTC fails to find bullish momentum.
However, a study of both the bull markets shows distinct differences that are noteworthy. Research from Pantera Capital found that after the current bull move, 86% of the crypto market’s value is concentrated in Bitcoin and Ethereum, largely because institutional funds have flowed into each cryptocurrency.
In 2017, the top two coins only held about 52% of the value, with the rest being held in several altcoins that turned out to be “non-functioning” coins. In the current bull market, retail investors seem to be largely absent so the type of speculation witnessed in 2017 has yet to appear in 2021.
Guggenheim Partners’ chief investment officer Scott Minerd recently said that his long-term Bitcoin price target of $400,000 remains and his recent tweet asking his followers to “take some money off the table” was based on the short-term price movement.
Although Minerd has not included Bitcoin in his mutual fund portfolios, he said purchases have been done in some private funds managed by Guggenheim.
While Bitcoin consolidates after the recent bull phase, select altcoins are extending their up-move. Can this continue? Let’s analyze the charts of the top-10 cryptocurrencies to find out.
Bitcoin is attempting to rebound off the 20-day exponential moving average ($34,380) but the weak bounce suggests a lack of urgency among bulls to accumulate on dips. As the price is stuck inside a symmetrical triangle, technical traders may wait for the price to break out of the pattern before buying.
If the price does not rise to the resistance line of the symmetrical triangle, the bears may smell an opportunity and will try to sink the price below the triangle. If they succeed, the BTC/USD pair may drop to the 38.2% Fibonacci retracement level at $29,688.10.
This is an important level to watch out for because, if the bears sink the price below this support, the drop could extend to the 50-day simple moving average ($26,932). The deeper the fall, the longer it is likely to take for the uptrend to resume because every rise will be met with a wave of selling by traders who are stuck at higher levels.
Another sharp correction could be avoided if bulls thrust the price above the triangle. The all-time high at $41,959.63 may act as a stiff resistance but if the bulls can drive the price above it, the pair could reach $50,000.
Ether (ETH) remains in a strong uptrend and is currently consolidating near the $1,300 to $1,349.10 overhead resistance. The upsloping moving averages and the relative strength index (RSI) near the overbought zone suggest the path of least resistance is to the upside.
The ETH/USD pair formed a Doji candlestick pattern on Jan. 17 and again today, indicating indecision between the bulls and the bears. If the uncertainty resolves to the upside and the bulls push the price above the overhead resistance, the uptrend could resume. The next target is $1,420 and then $1,675.
On the contrary, if the price turns down from the current levels and breaks below $1,152, the pair could drop to the 20-day EMA ($1,079). A strong rebound off this support will suggest accumulation at lower levels and the bulls will again try to resume the uptrend.
However, if the bears sink the price below the 20-day EMA, the decline could deepen to $1,000 and then to $900.
Polkadot (DOT) is in a strong uptrend and the momentum picked up after the altcoin broke above the $10.68 resistance on Jan. 13. The up-move reached $19.40 on Jan. 16, recording a 143% rally in four days.
Some short-term traders may have booked profits after the sharp rally, but the shallow correction suggests that the majority of the traders are not panicking. If the bears fail to pull the price below the 38.2% Fibonacci retracement level at $14.7259, the uptrend could resume.
If the bulls can push the price above $20, the DOT/USD pair could rally to $24 and then to $30. However, if the bears sink the price below $14.7259, the pair may consolidate the recent gains for a few days before starting the next trending move. The bears will signal a comeback if they can sustain the price below the 20-day EMA ($11.47).
The bears have been defending the 20-day EMA ($0.297) for the past few days but they have not been able to capitalize on the weakness and sink XRP below $0.25, which suggests a lack of sellers at lower levels.
The bulls will now attempt to push the price above the 20-day EMA. If they succeed, the XRP/USD pair may rally to $0.385. The bears are likely to defend this resistance aggressively.
If the price turns down from this resistance, the pair could extend its stay inside the range for a few more days. On the other hand, if the bulls push the price above the range and the 50-day SMA ($0.406), a new uptrend could begin.
Cardano (ADA) soared above the downtrend line on Jan. 16, signaling the resumption of the uptrend. The bulls pushed the price near the overhead resistance at $0.40 on Jan. 17, which may act as a stiff barrier.
However, the upsloping moving averages and the RSI in the overbought zone suggest that bulls are in command. If the bulls do not allow the price to dip and sustain below $0.34, the likelihood of a break above $0.40 increases. The next target on the upside is $0.50.
Contrary to this assumption, if the bears sink the price below $0.34, it will suggest aggressive profit-booking at higher levels. The ADA/USD pair could then drop to the 20-day EMA ($0.288).
A strong rebound off the 20-day EMA could keep the uptrend intact but a break below it may signal a short-term top.
The bulls and the bears have been battling it out near the 20-day EMA ($144) for the past few days. The buyers are currently trying to push Litecoin (LTC) above the 61.8% Fibonacci retracement level at $157.6904.
If they succeed, the LTC/USD pair could rally to $170 and then to $185.5821. A breakout of this resistance could open the doors for a rally to $225.
However, the bears are unlikely to give up without a fight. They will pose a stiff challenge at $157.6904. If the price turns down from this resistance, the pair may remain range-bound between $130 and $160 for a few days.
The trend will turn in favor of the bears if they can sink and sustain the price below the 50-day SMA ($118).
The bears are defending the $515.35 resistance but they have not been able to sink Bitcoin Cash (BCH) below the uptrend line. This shows the bulls are buying on dips.
If the bulls can push and sustain the price above the $515.35 to $539 resistance zone, the BCH/USD pair could rally to $631.71. The bears may defend this level aggressively but if the bulls can propel the price above it, the uptrend could reach $833.
The upsloping moving averages and the RSI in the positive territory suggest the path of least resistance is to the upside.
Contrary to this assumption, if the price turns down from the overhead resistance and breaks below the uptrend line, it will suggest the sentiment has turned negative and traders are closing their positions on a rally. This could result in a fall to $370.
Chainlink (LINK) is in a strong uptrend, making a new all-time high at $23.767 on Jan. 17. The upsloping 20-day EMA ($16.91) and the RSI near the overbought territory suggest bulls are in control.
However, bears are not willing to give up easily. They had attempted to stall the rally on Jan. 16 as seen from the long wick on the day’s candlestick and they are again trying to pull the price down today. The bears will have to sink and sustain the price below $20.1111 to gain the upper hand.
But if the LINK/USD pair rebounds off $20.1111, it will suggest the level has flipped to support and may act as a floor during future declines. If the bulls can push the price above $23.767, the uptrend could reach $27 and then $30.
Stellar Lumens (XLM) has been trading inside the $0.26 to $0.325 range for the past few days, but the upsloping 20-day EMA ($0.257) and the RSI in the positive territory suggest bulls have the upper hand.
If the buyers can push the price above $0.325, the XLM/USD pair may rally to $0.409 and if this level is also scaled, the up-move may reach $0.50. The longer the time spent in the range, the stronger will be the breakout from it.
Contrary to this assumption, if the bears sink the price below the range and the 20-day EMA, it could attract profit-booking by traders and the pair could drop to the 50-day SMA. Such a move will indicate advantage to the bears.
Binance Coin (BNB) rose to a new all-time high on Jan. 17 and followed it up with another new high today at $46.8888. However, the bulls are struggling to sustain the higher levels, which suggests some traders are booking profits.
The BNB/USD pair has formed an ascending broadening wedge pattern and the RSI is also showing signs of a bearish divergence. Both these suggest the bullish momentum may be weakening.
However, in a strong uptrend, bearish developments get negated as bulls resume their purchases after a break. Traders can watch the price action near the 20-day EMA ($40) because, if this support cracks, the bears will try to sink the price below the wedge.
But if the BNB/USD pair rebounds off the 20-day EMA, it will suggest that traders continue to buy on dips. Such a move could resume the uptrend with the next target at $50.
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.
Members of WallStreetBets Forum Alleged in Telegram Crypto Scam Stealing $2M in BNB and ETH
Members of the popular WallStreetBets Reddit forum were suspected of a presumable cryptocurrency fraud that could have caused losses of no less than $2 million. By creating a designated Telegram group, they duped investors by guaranteeing remarkable returns through capitalizing on the recent crypto market rally.
The Core of the Hoax
Per a report by Bloomberg, alleged members of the WallStreetBets Reddit Forum used the Telegram messaging service to execute a blatant scam. A particular account by the name of ”WallStreetBets – Crypto Pumps” presented users the chance to purchase a new token certified as WSB Finance before it was listed on crypto exchanges. The operation is known as a pre-mine sale.
The essence of the fraud was connected to the recent cryptocurrency boom as bitcoin and most altcoins skyrocketed in value lately. With some of the digital assets reaching 1,000% gains, the targeted WSB members conned investors into sending money without asking questions and with the potential of netting huge profits.
The notorious account also urged users to transfer popular cryptocurrencies such as Binance Coin (BNB) and Ethereum (ETH) to a designated crypto wallet and then to reach its ”token bot” to gain WSB Finance coins.
However, the perpetrators never dispatched those coins. Furthermore, another message on Telegram revealed that the people who had already issued a payment had to send an equivalent amount again or they would risk losing their initial investment.
After executing the hoax, more than 3,451 Binance Coins were withdrawn on Tuesday (May, 4th) from the wallet inside the Crypto Pumps messages.
Since the price of BNB at that point was approximately $625, the fraud caused losses of more than $2.1 million. Following the scam, thousands of people expressed their frustration and tried to expose the individuals behind the account. Moreover, the quantity of the other cryptocurrency – ether – still remains a mystery.
Two weeks ago WSB admins warned about offers that might try to take advantage of the forum’s name in order to allure the crypto audience. The ”WallStreetBets – Crypto Pumps” account has been removed from Telegram but whoever managed it left a message that might stun the affected victims:
”Buying Lambo now.”
South Korean Crypto Exchange Accused Of $1.5 Billion Scam
The South Korean cryptocurrency exchange platform V Global was accused of luring 40,000 people into illicit multi-level deceit. The entire scheme amounts to more than 1.7 million won, which equals $1.5 billion.
As reported by the Korean officials, the police raided many places in the country related to a virtual cryptocurrency exchange, and its notorious CEO – known as LEE – alleged to fundraising without regulatory permission. The authorities blocked the exchange’s cash deposits as a part of the investigation.
In total, the Gyeonggy Nambu Police Agency reported that it searched the exchange’s headquarters in southern Seoul along with 21 other places and froze more than $214 million left in the account.
Another report from today shed more light on the developments. According to Yonhap News, the name of the organization is V Global. The Korean police are examining the accusations against them for fraud under the Certain Economic Crimes Weighted Penalty Act, the Similar Receiving Act, and the door-to-door sales business.
The main accusation against the exchange is gaining a deposit of 1.7 trillion won ($1.5 billion) from 40,000 members in the period between August 2020 and January 2021. The announcement revealed that most of the people were elderly or housewives with no experience in cryptocurrency trading.
Too Good To Be True
The investigation revealed that the exchange urged investors to entrust their funds to an account and lured the members that the expected return would be three times higher than the initial investment. According to the authorities, there was a pyramid element in the scam as the exchange promised to grant an introduction fee of 1.2 million won ($1,065) for every newly recruited member.
The report affirmed that the trading venue paid some members in the form of a block. Therefore, people who signed up earlier received funds from individuals who entered the exchange later.
Moreover, the Korean police seem confident to deal with the fraud case as it revealed its intention to confiscate 240 billion won ($214 million) left in the V Global account as of the 15th last month, even before the prosecution process.
Georgia’s central bank is exploring ‘Digital Gel’ CBDC
The National Bank of Georgia said that it is considering launching a central bank digital currency.
In an announcement today, the central bank hinted at the issuance of a central bank digital currency, or CBDC, in an effort “to enhance efficiencies of the domestic payment system and financial inclusion.” The National Bank of Georgia, or NBG, said it would be inviting fintech firms and other financial institutions to participate in the project, named Digital Gel after the symbol for the country’s fiat currency, the lari.
“CBDC holds the promise to unlock the tremendous value of innovative business models for the benefit of society,” said the announcement. “The introduction of CBDC could increase financial intermediation efficiency, help introduce new financial technologies, facilitate financial inclusion, and reach previously unbanked populations.”
However, the bank mentioned the possibility of risks in the launch of a CBDC in the Republic of Georgia given the “new and potentially disruptive technology.” The NBG said it may conduct extensive testing of the CBDC in a controlled environment to ensure a smooth rollout, but did not provide any details regarding a timeline for launch.
With a population of roughly 4 million and a gross domestic product of approximately $15 billion, a nation like Georgia falls at the smaller end of countries exploring CBDCs. The Bahamas officially rolled out its Sand Dollar central bank digital currency in October, while China has been piloting its digital yuan in select cities prior to a full-scale launch. In the United States, Fortune 500 company Accenture announced this week it would be partnering with the Digital Dollar Foundation to conduct CBDC trials.
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