The Daily Cryptomenon
16th September 2020
Your daily Cryptocurrency Market Analysis News brought to you by the CryptoAltum Cryptomenon Team.
This analysis was written at 9:00 am GMT +3, on 16.09.2020
The Cryptocurrency Market is behaving in such a peculiar manner. While it’s normal to have some divergence between the Cryptocurrencies, when it comes to magnitude from time to time, they don’t usually experience different directions. With that said, let’s find out what today holds for the Cryptocurrencies on September 16th, 2020.
Cryptocurrency Recap
Our Cryptocurrency trio - Bitcoin, Ethereum, and Ripple find themselves moving in seemingly different directions as we see Bitcoin literally trading sideways while both Ethereum and Ripple seem to be moving lower after failing to break through their respective resistances. Bitcoin has been moving in a literal sideways manner as it tries to break above $10,800, it has succeeded a number of times to do so, however, it was never sustained as this level seems to be considered as the line of a skirmish between the Bulls and the Bears for this Cryptocurrency. Ethereum didn’t have the best of moves as the Cryptocurrency continued to move lower after it failed to break above $380, As the bearish pressure was enough to send this instrument lower and break below the 50 SMA (Simple Moving Average) on the 4-hour chart. The $0.2500 proved to be too much for Ripple to handle as the Cryptocurrency spiked lower during the Asian session. Ripple was sent towards $0.2340 before moving higher, but the damage was done and the 50 SMA on the 4-hour chart broke.
Bitcoin (check out the chart below you’ll find that Bitcoin is the purple line) moved in a steady fashion, neither moving higher or lower as the battle for dominance continues between the Bulls and the Bears. Meanwhile, the instrument was recording a performance of -9.38% on a month-to-month basis*. Ethereum’s (red line) didn’t just fail to break above $380, but it also failed to hold the downward momentum at the 50 SMA forcing Ether to fall even deeper and record a performance of -14.89% on a month-to-month basis. Ripple (orange line) seems to be suffering from the same fate as Ethereum as it moves even lower to record a performance of -19.54% on a month-to-month basis.
*Please note that we mention month/on/month we mean the same day, one month ago. For example, 1st August till the 1st September.
What’s the strategy you’re going to use when it comes to these cryptos? Do you believe that Bitcoin and Altcoins are going to converge higher? Or are they going to converge lower? Whatever you choose to believe, you can react to it all on CryptoAltum.
Bitcoin On Verge of Exploding Higher
Bitcoin recently saw a $2,000 correction after many months of surging. At the start of the selloff, signs pointed to profit-taking as the primary reason for the pullback. However, after greed turned into fear, big-money investors began buying the dip right out from under investors who are panic-selling the Cryptocurrency at a loss.
The crypto market has been on fire in 2020. Bitcoin remains the most profitable mainstream investment of the year next to gold, stocks, and anything else. However, the recent $2,000 crash turned the ultra greedy market into a fearful one. Contrarian investing strategies recommend selling when markets are at peak greed and then buying when most fearful. This strategy would have proven well over the last few weeks when the crypto market Fear and Greed Index reached record highs.
Technical analysis is telling us that Bitcoin is on the verge of exploding and should these patterns prove accurate, then Bulls would be right in buying the dip. Those who have sold on the way down may sorely regret it and be forced to buy back at higher prices. This all goes back to a resistance line that has now turned into a support, along with the $10,000 level which has held up against the continued bearish pressure. If that key level can also hold on to September throughout all its monthly chart, chances are that a new Bull market would fully develop, and a retest of all-time high would be only some months away.
Ethereum Plunges But Positive Signs Increase
Ethereum has seen some slight weakness throughout the past couple of days. This happened despite the intense strength that Bitcoin has displayed, signalling that the resistance ETH faces between $380 and $400 may be hard to break. Although ETH has yet to post any sort of technical breakout, it remains a strong likelihood that the digital asset sees further upside in the mid and long-term.
One trend seen while looking towards ETH’s daily moving averages is incredibly bullish and is strikingly similar to one seen in 2016. If history repeats itself, then this Cryptocurrency will be trading at over $1,000 in the upcoming couple of years – a possibility that one of our CryptoAltum analysts is calling likely. It’s important to note that this potential macro uptrend will depend somehow on Bitcoin, as it’s unlikely that Ethereum will see fresh all-time highs in the coming few years while BTC remains either bearish or stagnant.
At the time of writing, Ethereum is trading down below the 50 SMA on the 4-hour chart. This marks a notable decline from its recent highs of $380 that was set earlier this morning. After tapping this price level, the Cryptocurrency instantly began plunging lower, attempting to find support within the upper-$360 region. Ethereum failed to do so and finally plunged to the lower $360. This shows just how strong the selling pressure at this price level truly is.
Over the past few days, ETH Bulls have attempted to break above $380 on multiple occasions. Each time this price region has been broken above, the Cryptocurrency has only been able to sustain above it for a handful of hours. This shows that, at least for the time being, the Bears remain in firm control of the upper-$300 region.
Ripple Falls But Positive Momentum Remains
While the third-largest Cryptocurrency has been moving in a sideways fashion since the beginning of September, it has recently experienced an increase in bearish pressure that found it breaking below the 50 SMA on the 4-hour chart and that was an extended move that saw Ripple moving towards the $0.2300 support.
The break below the 50 SMA is causing quite a stir in the markets because that’s the answer the Bears are looking for to continue moving lower. However, with the presence of enough support below, the Bulls aren’t all that worried and hence not causing all that uproar. It would seem that the Bulls are planning to hold any kind of movement lower at the $0.2340 which held the recent crash lower.
The RSI (Relative Strength Index) has broken below the 50-level and is actually near the 40-level indicating that the momentum is switching from that of bullish to bearish. As long as the 40-level on this indicator isn’t broken we can safely assume that the bullish momentum will continue and we can see Ripple moving back higher. It all depends on the 40-level not breaking, then there’ll be a move higher enough to tempt the Bulls back into this market.
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