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Price analysis 1/8: BTC, ETH, XRP, LTC, ADA, DOT, BCH, XLM, LINK, BNB

Traders are buying every dip and pushing Bitcoin price to new highs on a daily basis, triggering many altcoins to follow suit.

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Bitcoin (BTC) again rose to a new all-time high on Friday as bulls continued to buy on every minor dip. As the price reached a new high, Bitcoin’s market capitalization soared above $775 billion, taking it past Facebook’s market cap, according to the website Companies Market Cap. This means, there are only six companies in the world that currently have a greater market cap than Bitcoin. 

The pace of the rally seems to have caught several traders off guard. Popular analyst flibflib told Cointelegraph that the sustained rise points to “accumulation algorithms and that accumulation algorithms seldom care about the price when their goal is to invest X$ in Y time period.”

Daily cryptocurrency market performance. Source: Coin360

The bull market has attracted huge trading activity that has smashed all previous volume records. Along with the spot markets, Bitcoin futures trading volume has also surged, hitting over $97 billion in a 24-hour period, according to data from Skew.

Traders must keep in mind that when the market reverses course, there will be a lot of selling to deal with and that could result in a sharp correction. On the way to new all-time highs, the market did not stop at resistance levels and during the fall, these same support levels may prove useless. Therefore, traders must follow their money management principles and not be blinded by greed.

Let’s study the charts of the top-10 cryptocurrencies to spot any topping patterns or levels where the markets may reverse direction.

BTC/USD

The long tail on today’s candlestick suggests that bears tried to start a pullback but the bulls thwarted their attempt and purchased the intraday dip. The trend has been so strong that there hasn’t been a consecutive three-day correction since Dec. 12.

BTC/USDT daily chart. Source: TradingView

The vertical rally of the past few days has pushed the relative strength index (RSI) deep into the overbought territory but that has not lowered the demand from the bulls.

The BTC/USD pair could next rally to $45,000 and if that resistance is scaled, the uptrend could extend to $50,000. This psychological level could offer stiff resistance and that may result in a correction.

On the downside, the first support is the 20-day exponential moving average ($30,539). A strong rebound off this support will keep the uptrend intact.

Conversely, if the bears sink the price below the 20-day EMA, the decline could deepen with the next support at the 50-day simple moving average near $23,218.

ETH/USD

Ether (ETH) made a long-legged Doji candlestick on Jan. 7, indicating indecision among the bulls and the bears about the next directional move. That uncertainty resolved to the downside today and the bears pulled the price down to $1,063.322.

ETH/USDT daily chart. Source: TradingView

However, the bulls aggressively purchased the dip resulting in the formation of the long tail on the day’s candlestick.

If the bulls can push the price above $1,288.668, the ETH/USD pair could rally to $1,420. The bears may try to pose a stiff challenge at this level but if crossed, the momentum could pick up and the pair could rise to $2,000.

Conversely, if the price turns down from the current levels and plummets below $1,063.322, the pair may drop to the 20-day EMA ($886).

XRP/USD

XRP is the only major cryptocurrency that has not participated in the ongoing bull run. Traders sensed an opportunity and pushed the price above the 20-day EMA ($0.30) on Jan. 7, but selling near the 38.2% Fibonacci retracement level is preventing the price from pushing above $0.358202.

XRP/USDT daily chart. Source: TradingView

The bears are currently trying to sink the price below the 20-day EMA. This suggests that the sentiment on the XRP/USD pair remains negative, and traders are selling on rallies. The pair could now remain range-bound between $0.169 and $0.385.

Contrary to this assumption, if the bulls can push the price above $0.385, it will suggest that the downtrend is over. That may result in a rally to the 50-day SMA ($0.45).

LTC/USD

Litecoin (LTC) formed a Doji candlestick pattern on Jan. 7, suggesting profit-booking by traders near the stiff overhead resistance at $180. The bears sensed an opportunity to stall the uptrend and attempted to trigger a correction today.

LTC/USDT daily chart. Source: TradingView

However, the bulls are in no mood to relent and they aggressively purchased the dip today, as seen from the long tail on the candlestick. If the LTC/USD pair climbs above the stiff overhead resistance at $180, the LTC/USD pair could rally to $200.

The RSI remains in the overbought territory, suggesting that the bears may again try to raise a roadblock at $180. If the price turns down from this resistance, the pair could drop to the 20-day EMA ($138).

A strong rebound off the 20-day EMA will suggest that the trend remains bullish, but a break below it will increase the possibility of a deeper correction.

ADA/USD

The bulls attempted to extend the uptrend on Jan. 7, but the bears aggressively sold above $0.340. Cardano (ADA) corrected to the 50% Fibonacci retracement level at $0.2614241 today, where buying emerged.

ADA/USDT daily chart. Source: TradingView

The long tail on today’s candlestick shows that traders are using the dips to accumulate as the sentiment remains bullish. If the bulls can thrust the price above the overhead resistance, the ADA/USD may resume the uptrend and rally to $0.40 and then to $0.50.

However, if the bears again successfully defend the overhead zone, the pair may remain range-bound between $0.26 and $0.35 for a few days. A break below $0.26 could start a deeper correction to the 20-day EMA ($0.21).

DOT/USD

Polkadot (DOT) attempted to resume the uptrend on Jan. 7, but traders booked profits at higher levels. The bears tried to start a correction, but the altcoin bounced off $8.7788 today, from just above the 38.2% Fibonacci retracement level at $8.5515.

DOT/USDT daily chart. Source: TradingView

The rising moving averages and the RSI in the positive territory suggest an advantage to the bulls. The DOT/USD pair may again rise to $10.68. If the bulls can thrust the price above this resistance, the uptrend may resume with the next target objective at $12.39 and then $15.

However, if the pair turns down from the overhead resistance, that could result in a few days of consolidation. A break below $8.5515 and the 20-day EMA ($7.92) may indicate the start of a deeper correction.

BCH/USD

Bitcoin Cash (BCH) formed a long-legged Doji candlestick pattern on Jan. 7, indicating indecision among the bulls and the bears about the next directional move. The bears pulled the price down today, but they could not sustain the lower levels, as seen from the long tail on the day’s candlestick.

BCH/USD daily chart. Source: TradingView

If the price again turns down from the $497 to $515.35 overhead resistance zone, it will suggest traders are booking profits at higher levels. That could keep the BCH/USD pair range-bound between $370 and $500 for a few more days.

However, the upsloping moving averages and the RSI near the overbought zone suggest bulls are in command. If they can push the price above the resistance zone, the pair may start a new uptrend with the first target at $640.

XLM/USD

The long wick on the Jan. 6 and 7 candlestick shows that traders booked profits at higher levels. However, the bulls continue to buy at lower levels, as seen from Stellar Lumens’ (XLM) bounce off the 50% Fibonacci retracement level at $0.266547 today.

XLM/USDT daily chart. Source: TradingView

After the large range days of the past few days, the XLM/USD pair may enter a few days of consolidation as traders digest the recent gains and decide on the next course of action.

If the bulls can push the price above $0.409, the pair could resume the uptrend that may reach $0.50.

On the contrary, if the price slips and sustains below $0.266547, the pair may drop to the 61.8% retracement level at $0.232828 and then to the 20-day EMA ($0.19).

LINK/USD

Chainlink (LINK) turned down from the $17.7777 overhead resistance on Jan. 7, and that attracted profit-booking by short-term traders who dragged the price down to the 20-day EMA ($13.54) today.

LINK/USDT daily chart. Source: TradingView

The upsloping 20-day EMA and the RSI in the positive zone suggest bulls have the upper hand. Thus, traders used the dip to aggressively buy at lower levels, resulting in a long tail on today’s candlestick.

If the bulls can propel the price above $17.7777, the LINK/USD pair could rally to $20.1111. If this level is also scaled, then LINK price could extend toward $25.

However, if the bears successfully defend the overhead resistance once again, then the pair may consolidate between $14 and $17.7777 for a few days. A break below the moving averages will signal that bears are back in the game.

BNB/USD

The candlesticks of the past few days show long tails, which indicate traders have been booking profits at regular intervals. Although dip buyers have continued to push Binance Coin (BNB) higher, the up-move lacks conviction.

BNB/USDT daily chart. Source: TradingView

If the momentum does not pick up within the next few days, the BNB/USD pair will be at risk of a correction or consolidation. A break below the 20-day EMA ($37.93) will be the first sign of a possible deeper correction.

Contrary to this assumption, if the bulls can drive the price above $45, the pair could rally to $50, where the bears may try to stall the uptrend.

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.

Source: https://cointelegraph.com/news/price-analysis-1-8-btc-eth-xrp-ltc-ada-dot-bch-xlm-link-bnb

Blockchain

Massive Bearish Divergence Hints At First Major Chainlink Corrective Phase

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Chainlink was among the first cryptocurrency to set a new all-time high in 2020, but given its absence during the 2017 peak was facing different circumstances and no overhead resistance. The » Read more

” href=”https://www.newsbtc.com/dictionary/altcoin/” data-wpel-link=”internal”>altcoin was nearly unaffected entirely by the » Read more

” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear market over the last couple of years, breaking record after record.

However, a massive bearish divergence has formed as the unstoppable cryptocurrency touches an ascending trendline for the third time. Could this be the start of the » Read more

” href=”https://www.newsbtc.com/dictionary/altcoin/” data-wpel-link=”internal”>altcoin’s first extended » Read more

” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear phase? Or are bulls preparing a much stronger push to finally blast through the long-term trendline?

Chainlink At Risk Of First Major Corrective Phase, According To » Read more

” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>Bear Div

In 2017, Bitcoin’s meteoric rise and the explosion of ICOs built on Ethereum put the cryptocurrency asset class on the map. But after a storm of exuberance and parabolic price action, the bubble burst and these assets came crashing down by as much as 90% or more in many cases.

Even the crypto asset with the most longevity, Bitcoin, fell a full 84% from high to low, resulting in a three year » Read more

” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear market. During that time, however, Chainlink made its debut in the crypto space, and its been on an unstoppable uptrend ever since.

Related Reading | Analyst: After A 50% Retrace Against Bitcoin, Chainlink Is “Ready” To Soar

The » Read more

” href=”https://www.newsbtc.com/dictionary/altcoin/” data-wpel-link=”internal”>altcoin rose from nearly worthless to over $25 recently at its 2021 peak. Chainlink went from being born during a » Read more

” href=”https://www.newsbtc.com/dictionary/bear/” data-wpel-link=”internal”>bear market, to hitting all-time highs left and right even before a bull market was confirmed.

Since things turned bullish, even Chainlink joined in Bitcoin and Ethereum and set yet another record peak. The entire market has once again turned back down, but the soaring » Read more

” href=”https://www.newsbtc.com/dictionary/altcoin/” data-wpel-link=”internal”>altcoin remains near 2021 highs.

Bearish Divergence, Or Are Bulls Baiting For The Next Move Up?

The recent push to $25 per token, has resulted in a massive bearish divergence on the weekly Relative Strength Index, spanning across the current peak and the 2020 high of $20, according to one crypto trader.

Coinciding with the bearish technical signal, is a more three-year long trendline that has acted as the top to every major rally. The chart below shows the long-term trendline on the LINKUSDT trading pair on Binance more clearly.

chainlink linkusdt bear div

A massive bearish divergence spans across two years of LINKUSDT price action  | Source:  LINKUSDT on TradingView.com

Bearish divergences appear when price action sets a higher high, but a technical indicator on the same timeframe chart makes a lower low. It often suggests that although prices are reaching new highs, the underlying buying pressure is lower than during the first peak.

The weakness results in bears taking over, and forcing prices lower. Bearish divergences often appear at the top of a trend, but are difficult to act on.

Related Reading | Altcoin Expert: Buy Crypto That Holds Up During Bitcoin Breakdown

Bearish divergences are only confirmed once price action has turned down. The lack of a higher high on a technical indicator could merely be due to the fact the bullish move is only yet just beginning. Taking a position in a long up-trending » Read more

” href=”https://www.newsbtc.com/dictionary/altcoin/” data-wpel-link=”internal”>altcoin due to a bearish divergence could lead to any missing out on any additional legs up that might follow.

Given Chainlink’s long-term momentum, the bearish divergence – if invalidated – could supply the momentum needed for a much stronger push higher.

Featured image from Deposit Photos, Charts from TradingView.com

Source: https://www.newsbtc.com/analysis/link/massive-bearish-divergence-hints-at-first-major-chainlink-corrective-phase/

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3 reasons why Ethereum price is still on track to top $2,000

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After dropping 27% over three days, Ether (ETH) price finally reached a bottom at $1,040 on Jan. 22. 

The sharp correction liquidated $600 billion worth of future contracts but interestingly, Ether price rebounded to a new all-time high even as Bitcoin price continues to trade in a slight downtrend.

According to Cointelegraph, the increasing TVL and transaction volumes of the decentralized finance sector are behind Ether’s impressive surge.

ETH/USD 4-hour chart. Source: TradingView

To determine whether the recent pump reflects a potential local top, we’ll take a closer look at on-chain flows and derivatives data.

Exchange withdrawals point to whale accumulation

Increasing withdrawals from exchanges can be caused by multiple factors, including staking, yield farming, and buyers sending coins to cold storage. Usually, a steady flow of net deposits indicate a willingness to sell in the short-term. On the other hand, net withdrawals are generally related to periods of whale accumulation.

ETH held in exchange wallets. Source: Cryptoquant.com

As the above chart shows, on Jan. 23, centralized exchanges recently reached their lowest Ether reserve levels since November 2018.

Although there is some discussion whether part of this Ether exodus is an internal transfer between Bitfinex cold wallets, there has been a clear net withdrawal trend over the past month. Despite these ‘rumors’, the data points towards accumulation.

This data also coincides with the DeFi’s total value locked (TVL) reaching a $26 billion all-time high and signals investors chose to take advantage of the lucrative yield opportunities that exist outside of centralized exchanges.

Futures were overbought

By measuring the expense gap between futures and the regular spot market, a trader can gauge the level of bullishness in the market.

The 3-month futures should usually trade with a 6% to 20% annualized premium (basis) versus regular spot exchanges. Whenever this indicator fades or turns negative, this is an alarming red flag. This situation is known as backwardation and indicates that the market is turning bearish.

On the other hand, a sustainable basis above 20% signals excessive leverage from buyers, creating the potential for massive liquidations and eventual market crashes.

March 2021 ETH futures premium. Source: NYDIG Digital Assets Data

The above chart shows that the premium peaked at 6.5% on Jan. 19, equal to a 38% annualized rate. This level is considered extremely overbought, as traders need an even higher price increase ahead of expiration to profit from it.

Overbought derivatives levels should be considered a yellow flag, although maintaining them for short periods is normal. Traders might momentarily exceed their regular leverage during the rally and later purchase the underlying asset (Ether) to adjust the risk.

One way or another, the market adjusted itself during the Ether price crash, and the futures premium currently stands at a healthy 4.5% level, or 28% annualized.

Spot volume remains strong and traders bought the dip

In addition to monitoring futures contracts, profitable traders also track volume in the spot market. Typically, low volumes indicate a lack of confidence. Therefore significant price increases should be accompanied by robust trading activity.

ETH aggregate spot exchanges volumes. Source: Coinalyze.net

Over the past week, Ether has averaged $6.1 billion in daily volume, and while this figure is far from the $12.3 billion all-time high seen on Jan. 11, it is still 240% higher than December’s. Therefore, the activity supporting the recent $1,477 all-time high is a positive indicator.

Exchange-provided data highlights traders’ long-to-short net positioning. By analyzing every client’s position on the spot, perpetual and futures contracts, one can obtain a clearer view of whether professional traders are leaning bullish or bearish.

With this said, there are occasional discrepancies in the methodologies between different exchanges so viewers should monitor changes instead of absolute figures.

Exchanges top traders ETH long-to-short ratio. Source: Bybt.com

The top traders index at Binance and Huobi have held roughly the same Ether position over the past couple of days. Huobi’s average over the past 30 days has averaged a 0.83 long-to-short ratio while at Binance traders held a 0.94 average. The current reading at 0.85 indicates a slight negative sentiment.

OKEx stands out as the top traders long-to-short ratio peaked at 2.0, strongly favoring longs in the early hours of Jan. 22, but it decreased until Jan. 24 and finally bottomed at 1.05. The strong net selling trend was reverted today as traders bought the dip and the indicator flipped to 1.17 in favor of longs.

One should keep in mind that arbitrage desks and market makers encompass a vast portion of the exchanges’ top traders metric. The unusually high futures premium would incentivize those clients to create short positions in futures contracts while simultaneously buying Ether spot positions.

Considering Ether’s on-chain data indicating whales hoarding, along with the healthy futures contracts premium, the market structure seems reliable.

The fact that top traders at OKEx also bought today’s dip is further indication that the rally should see continuation.

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.

Source: https://cointelegraph.com/news/3-reasons-why-ethereum-price-is-still-on-track-to-top-2-000

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Bank Of Singapore: Bitcoin Could Succeed As A Store Of Value

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The Singaporean private banking arm of OCBC Bank has dismissed the chances of cryptocurrencies eventually replacing fiat currencies as a medium of exchange. However, the large institution believes that BTC and other altcoins can replace gold in terms of serving as a store of value.

Cryptocurrencies: Store Of Value; Not Medium Of Exchange

Ever since the introduction of Bitcoin in the late 2000s, people have wondered if the cryptocurrency could indeed live up to the potential of operating as an electronic peer-to-peer cash system, as intended by the anonymous creator – Satoshi Nakamoto.

Doubters have breached the infamous volatility as a significant obstacle in BTC’s path. It seems that the Bank of Singapore agrees with this narrative, according to recent coverage.

Chief economist Mansoor Mohi-uddin used the movements from the past year, where BTC went from a low of $4,000 during the mid-March liquidity crisis to a new all-time high above $40,000 months later, to exemplify it and dismiss this narrative.

However, bitcoin and other altcoins can have a role as a digital store of value if they manage to address several potential issues. Apart from the aforementioned price fluctuations, those include high liquidity and safe custodians.

“First, investors need trustworthy institutions to be able to hold digital currencies securely. Second, liquidity needs to improve significantly to reduce volatility to manageable levels.” – explained the economist.

Additionally, the crypto ecosystem requires more regulations from world watchdogs to reduce their alleged involvement in criminal activities. However, Mohi-uddin warned that if governments felt threatened by the existence of particular digital assets, they could fight back, which is the case with the growing trend of central bank digital currencies.

Institutional Adoption Highlights BTC’s Store Of Value Qualities

The bank’s economist explained that the growing appetite from institutional investors had supported the belief that bitcoin should be used as a store of value instead of a medium of exchange. Furthermore, some of them even outlined the idea that BTC could replace gold or it’s better than the precious metal in a way.

SkyBridge Capital co-founder Anthony Scaramucci recently asserted that the largest cryptocurrency is easier to store, harder to steal, more portable, and ultimately, better than gold.

CIO at the Wall Street behemoth BlackRock, Rick Rieder, predicted that BTC could take some of the market share of the yellow metal and eventually even replace it.

Similarly, JPMorgan’s analysis concluded that the cryptocurrency has started to garner some of gold’s market share, which could harm the bullion’s price in the long-run.

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Source: https://cryptopotato.com/bank-of-singapore-bitcoin-could-succeed-as-a-store-of-value/

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