Technical analysis

The crypto market at the dawn of a key movement for 2020

Julien Moretto – 10 Jun 2020

There’s a palpable impatience in the crypto market this week. Bitcoin has been trading below €8,900 ($10,000) since early May. The asset is trading around €8,600 ($9,700) on June 10, up just 1% over a week. It has maintained a medium-term uptrend since mid-March but has failed to reach significant market highs above the symbolic $10,000 mark. The direction of the next volatile movement will be important and will set the trend for the coming months.

Altcoins again remain correlated to the ”King Bitcoin” in the majority of cases. Nevertheless, this week sees two top 50 assets stand out: Kyber Network (KNC) with +45% and Maker (MKR) with +56%. The decorrelation seems to be finally taking place between the stock market and the crypto market. The former is continuing to rise while the latter has been stagnating for about a month. Let’s analyze it.

  • According to CoinGecko, Market capitalization is up slightly to $277 billion, up from $270 billion seven days ago.
  • Bitcoin’s dominance remains stable at 64.5% this week.
  • The Altcoin Maker (MKR) offers the best performance of the top 50 with +56% over the week.
  • Institutional investors are prepared to pay a premium of around $1500 for exposure to ETH

We invite you to discover our full analysis in video (recorded in june 10, in french)

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Bitcoin (BTC)

Coinhouse’s Recommendation : 
Wait

  • The Bitcoin price continues to lateralize. So there is nothing to do but wait for the market to take its next clear direction. This week’s exercise is to properly establish the price levels at which we will intervene on both the up and down trends.
  • The bullish scenario: in order to continue the uptrend despite the sudden drop on June 2nd, the price has to move back above the €8,700 to €8,800 ($9,800 to $9,900), a level corresponding to the 0.5 and 0.618 Fibonacci retracement of the June 2nd drop. This will then be a buy signal. The price will return to test the resistance again at the €8,900 ($10,000) level, which should eventually give way. But we will of course remain cautious as we approach this zone. Breaking up this resistance will bring the price towards the €9,800 ($11,000) level, where we should consider taking profits.
  • The bearish scenario: an impulsive bearish move takes place and breaks the last remaining €8,400 ($9,200) support. The break of this support will also correspond to the break of a medium-term support line that has been supporting the price of Bitcoin since mid-March. It will therefore be a sell signal which should bring the price back to the old support of €7,600 ($8,200) where we will then look for signal buying.

Ethereum (ETH)

Coinhouse’s Recommendation : 
Wait

  • Similar scenario for Ethereum (ETH) which moves little: +1% over the week to settle around €214 ($243) on June 10. Same exercise as on Bitcoin. The point is to identify the important price levels that will trigger reactions.
  • The buyer’s scenario: if the market as a whole remains bullish, any return of Ethereum’s price to the €200 to €210 ($215 to $225) range is an opportunity for buying. The objective remains a rise to the next resistant zone around €245 to €260 ($255 to $275), which corresponds to a previous market peak worked in February. Profits can then be taken on this level.
  • The selling scenario: Ethereum’s share price must absolutely stay above its bullish breakout level of €200 ($215). A daily closing price below this level will be a sell signal and then aim at the €170 ($180) support for buybacks.

Chainlink (LINK)

Coinhouse’s Recommendation : 
Buy on breakout

  • Chainlink (LINK) is down slightly by 1.7% this week to €3.87 ($4.40) but has a very interesting chart pattern.
  • Indeed, the price of Chainlink continues to move in a wide range between $1.50 and $4.60. In mid-March, in the midst of the Covid-19 crisis, its price was close to the €1.40 ($1.50) support and represented a great buying opportunity. Since then, the price has only gone up without offering any real retracement.
  • So two possibilities to enter the purchase: the first is to wait for a retracement on the level of €2.55 ($2.75) which corresponds to a Fibonacci retracement level relevant to the last rise. Or wait for the break at the top of the range then a day fence above the level of €4.20 ($4.60). The immediate breakout at the top of the range will occur if the market as a whole continues its current uptrend.

Top & flops of the week (top 50 marketcap)


Tops

1- Maker (MKR) : +55%
2- Kyber Network (KNC) : +45%
3- Ziliqa (ZIL) : +34%


Flops

1- Digibyte (DGB) : -9,6%
2- OMG Network (OMG): -7,6%
3- Ethereum Classic (ETC) : -4,7%

Investors’ attention is drawn to the fact that the content of the articles does not constitute investment advice.
Investment in cryptocurrencies carries a risk of total capital loss.
For more information, please do not hesitate to contact our support department.

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