The cryptocurrency market shows a very optimistic scenario this week, especially on some altcoins. Bitcoin has gained 7% over the last seven daysm trading around €7,900 ($8,800) and breaking through a key resistance. Altcoins offer more impressive gains over the week. If Ethereum gains +15%, other assets literally explode: Bitcoin Cash with +41%, Litecoin with +26% but especially Dash with +125% and the controversial Bitcoin SV (BSV) with +233%! If the frenzy seems to be back on the altcoins, Bitcoin still has to break an important resistance at €8,400 ($9,200) which will be a long term reversal signal. Here is our market analysis.
According to CoinGecko, market capitalisation continues to appreciate sharply to $240 billion from around $218 billion on January 8.
Bitcoin’s dominance is declining in this context of strong growth for the altcoins, at 66%, compared to around 69.2% at the beginning of January.
Bitcoin SV (BSV) with +233% and DASH with +125% are to be credited for the week’s most impressive performances.
This strong uptrend comes at a time when the CME Group has just launched Options on its Bitcoin futures contracts. It is difficult to know if this is the main catalyst for the increase, but the volumes reported are impressive.
We invite you to discover our complete analysis in video (in french and dated from January 14):
Bitcoin (BTC)
Coinhouse recommendation: Hold
We recommended to buy Bitcoin for the last two weeks, since the €7,100 ($7,900) level was broken. Although the break of the €7,700 ($8,500) resistance on the daily timeframe is a good sign, the price is fast approaching another major resistance: the €8,400 ($9,200) one. And the price should probably consolidate/correct soon. For these reasons, we advise not to make any new purchases but to hold positions for the moment.
The 200-day moving average is also on the €8,400 ($9,200) level. We will therefore monitor the chart if it reaches this zone. But sellers will likely try to settle on this level.
The €8,400 ($9,200) level also corresponds to the Fibonacci retracement level 0.618 of the decline initiated from $10,300 on October 26, 2019. Another observation that could make this level act as a resistance.
Volumes remain relatively low. The break of the €7,700 ($8,500) level also corresponds graphically to the break of the upper line of the downtrend channel in which the price has traded since the correction that started at the end of June 2019. Ideally, we would have liked to see a more significant increase in volumes.
The RSI indicator could also provide more information about the confirmation of a long-term reversal. If on the daily timeframe, the RSI reaches the overbought zone, then this will be a positive signal, as this has not happened since the last peak at the end of June 2019.
Finally, the MACD indicator is about to make a bullish cross on the weekly timeframe. The last one occured in February 2019, just before the strong uptrend of 2019.
Ethereum (ETH)
Coinhouse recommendation: Wait
Ethereum nous offre également une belle semaine : +15% en 7 jours, à148€ (166$) ce 15 janvier.
Mais il faut rester patient sur Ethereum et attendre davantage de confirmation avant de prendre des positions long-terme sur cet actif. Ethereum a en effet davantage baisser que Bitcoin sur ces 7 derniers mois. Son précédent plus haut dans l’unité de temps journalière, atteint mi-novembre 2019, se trouvait autour des 165€ (180$). Malgré la hausse récente des derniers jours, nous pourrions toujours n’être que dans un rebond technique.
Le retour du cours dans la zone pivot des145€ à 160€ (160$ à 180$)est toutefois positif. Les plus enclins au risque pour tenter des achats dès à présent, mais en pensant à protéger leurs positions en cas de revers baissier.
Dans une optique d’investisseur long-terme, nous préférerons attendre que le cours consolide dans cette zone pivot, pour ensuite aller casser le niveau des 160€ (180$). La cassure de ce niveau sera un véritable signal d’achat et devrait confirmer un retournement de tendance à moyen-terme sur Ethereum.
Ethereum is also performing well this week: +15% in 7 days, at €148 ($166) this January 15.
But patience is the key on Ethereum. We wait for more confirmation before taking long term positions on this asset. Ethereum has dropped more than Bitcoin over the last 7 months. Its previous high in the daily timeframe, reached mid-November 2019, was around €165 ($180). Despite the recent uptrend in the last few days, we may still only be in a technical bounce.
However, the fact that the price is back to the pivot zone from €145 to €160 ($160 to $180) is positive. The most risk-profile traders could try to buy now, but knowing how to protect their positions in the case of a bearish turnaround.
From a long-term investor’s perspective, we prefer to wait for the price to consolidate in this pivot zone, and thento break up the €160 ($180) level. Breaking this level will be a strong buy signal and should confirm a medium-term trend reversal on Ethereum.
Bitcoin Cash (BCH)
Coinhouse recommendation: Buy on pullback
Très belle hausse cette semaine pour Bitcoin Cash (BCH) qui s’apprécie de 40% pour coter désormais à 306€ (340$)ce 15 janvier.
Un début de retournement haussier sur cet actif qui devrait lui aussi profiter du "catalyseur" du halving. De plus, selon les dernières estimations, le halving du Bitcoin Cash devrait intervenir dans le courant du mois d’avril, soit avant celui du Bitcoin.
Au cours de la seule journée du 14 janvier, le cours du Bitcoin Cash s’est apprécié de 30%, pulvérisant au passage la résistance autour des 275€ (300$) qui correspondait à un précédent sommet dans l’unité de temps journalière. À court-terme, la tendance s’est donc retournée sur Bitcoin Cash
Ce 15 janvier, le cours teste désormais la résistance des 310€ (350$). Se positionner à l’achat sur cet actif qui vient de fortement s’apprécier peut être risqué. Nous préférerons utiliser les retracements de Fibonacci pour tenter de trouver une entrée plus stratégique. Si le cours offre un retracement dans la zone des 0.5 à 0.618, alors des achats seront intéressants. Ils s’effectueront donc dans une zone comprise entre 235$ et 255$.
Strong performance for Bitcoin Cash (BCH), up by 40% this week and trading at €306 ($340) on January 15.
Likely the beginning of a bullish reversal on this asset which should also benefit from the "catalyst" of the halving. Moreover, according to the latest estimatations, the halving of Bitcoin Cash should take place during the month of April, one month before Bitcoin
On January 14, the price of Bitcoin Cash was up by 30%, breaking through the €275 ($300) resistance , which was a previous high in the daily timeframe. Short term, the uptrend is confirmed on Bitcoin Cash.
On January 15, the chart is now testing the 310€ ($350) resistance. Buying this asset, which has just appreciated sharply, can be risky. We prefer to use the Fibonacci retracements to try to find a more strategic entry. If the price offers a retracement in the 0.5 to 0.618 range, then buying will be interesting. The strategic zone is located between $235 and $255.
CME Bitcoin options doubles Bakkt’s volume on its first day Two newcomers appear on the Bitcoin options market, in addition to Bakkt: CME and Binance. CME closed its first day at just over two million dollars in volume. Binance, on the other hand, traded for more than 16 million dollars. It is possible that CME will catch up quickly, as institutional investors may prefer this platform. In both cases, volumes are beyond what was expected. For an explanation of what Bitcoin options are, you can refer to this Coindesk article.
Investors’ attention is drawn to the fact that the content of the articles does not constitute investment or financial advice. Investing in cryptocurrencies involves a risk of total capital loss. For more information, please do not hesitate to contact our support department.
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