Cryptocurrency Values Plunged This Past Week. Should You Change Your Investing Strategy?

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The Motley Fool 27 June, 2021 - 04:18am 24 views

Why is Bitcoin dropping today?

Bitcoin (CRYPTO:BTC) tokens are worth about 15% more than they were at the start of 2021. Today, Bitcoin is dropping as investors digest both China's recent actions related to the cryptocurrency and a major bank's opinion on its future. Motley FoolHere's Why Bitcoin Dropped Today

Why is crypto going up?

Rising inflation and the potential for even more stimulus continues to push people to safe-haven assets. Increased adoption from payment applications like PayPal will give far more people easy access to cryptocurrency. Publicly traded companies purchasing Bitcoin shows a high level of confidence in its appreciation. InvestopediaCrypto News: Why Is Bitcoin's Price Rising?

A successful Wyckoff culmination could see BTC price action target levels north of $40,000 again, one analysts says.

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting highs of $33,445 on Bitstamp Sunday.

Saturday saw the pair drop back to $30,070, ultimately averting another dip below significant psychological support after last week's volatility.

This was not enough to buoy sentiment among traders, however, as many already believed the local BTC price bottom was not yet in.

Can't we just all agree to dump #BTC and nuke it to $26k over the weekend to start on monday the next bull run with a V-shape recovery ?

For analyst Rekt Capital, the prospect of Bitcoin losing its 50-day exponential moving average (EMA), currently at $33,500, was cause for concern for bulls.

"The BTC recovery is promising but the 50 WEMA hasn't yet been reclaimed as support," he told Twitter followers after Sunday's move higher.

At the time of writing, BTC/USD traded at around $32,400, leaving a fair amount of ground to cover to clinch a more optimistic start to the coming week.

Rekt Capital added that using Wyckoff analysis, Bitcoin could still bounce by $10,000 to end in the mid-$40,000 range if a current wedge holds without a breakdown.

As ever, longer-term outlooks from seasoned market participants showed a different world from the fraught intraday price activity. 

Among the sources of feel-good analysis at the weekend was PlanB, creator of the stock-to-flow price models.

"Bitcoin: short term volatile, long term trending up," he summarized alongside a comparative chart of Bitcoin's 200-week moving average (WMA) and realized cap.

As Cointelegraph reported, the 200 WMA is a principal "line in the sand" that spot price has never crossed. It continues to increase each month despite recent losses.

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AAVE And Amp: Top Tier Cryptocurrencies

Investing.com 27 June, 2021 - 07:00pm

On Apr. 14, when Bitcoin rose above the $65,000 level, the calls for $100,000 and higher dominated the financial airwaves. Bull market action can make the dubious committed bulls. Jamie Dimon, the chairman and CEO of Chase called Bitcoin a fraud a few short years ago and threatened to fire any Chase trader who bought the digital currency. Over the past months, the CEO swallowed his pride and words, allowing the bank’s top clients to include Bitcoin and other digital currencies in portfolios.

Bitcoin and many digital currencies reached highs the day the NASDAQ listed Coinbase (NASDAQ:COIN), the crypto trading platform. The stock jumped to nearly $430 per share on its first trading day, even though the reference price was $250 per share. COIN’s market cap reached almost $100 billion, more than either the CME (NASDAQ:CME) or ICE (NYSE:ICE), two well-established market exchange platforms.

Gravity can be a powerful force in markets. After a few tweets from Tesla's (NASDAQ:TSLA) Elon Musk objecting to the carbon footprint left by Bitcoin miners, China cracked down on the cryptocurrency asset class. The Chinese are preparing to release a digital yuan and are likely limiting competition. Moreover, like all governments, China will do everything within its power to control the money supply. Cryptocurrencies threaten the government’s power as money is a critical control issue.

The weekly chart shows the move from $65,520 in mid-April to a low of $28,800 on June 22. The low in 2021 was $28,440 in early January. After reaching the low on June 21, Bitcoin bounced and traded at the $33,000 level later during the session.

The weekly Ethereum chart shows the drop to a low of $1697.75 on June 22. Ethereum bounced back over the $1900 level on the day it made the latest spike low. Ethereum traded to the lowest level since late March.

Bitcoin and Ethereum are trading at less than half the prices at their highs in mid-April and mid-May.

At the end of 2020, a total of 8,153 different cryptocurrency tokens were floating around in cyberspace. At the end of Q1 2021, the number rose by 10.9% to 9,045. As of June 22, it was 16.8% higher than at the end of Q1 at 10,561 tokens. The price action in April and May that took Bitcoin and Ethereum to all-time highs prompted issuers to bring more cryptocurrencies to market.

Meanwhile, the overall asset class’s market cap peaked at well over $2 trillion over the past months. The level stood at just above the $1.3 trillion level as of June 22. Bitcoin and Ethereum account for 64.2% of the market cap. The market caps of many of the other over 10,500 tokens have declined alongside Bitcoin and Ethereum over the past weeks.

AAVE (AAVE) is a decentralized money market that operates on the Ethereum blockchain. AAVE allows users to lend and borrow a range of crypto assets. AAVE’s website describes it as a “non-custodial liquidity protocol for earning interest on deposits and borrowing assets.”

Source: CoinMarketCap

As the chart highlights, AAVE reached a low of around $26.20 in November 2020 and a high of $643.07 in mid-May 2021 when Ethereum peaked. The crypto moved over twenty-four and one-half times higher from late 2020 to the May 2021 high. At the $214 level on June 22, AAVE was one-third the price at the highs as the crypto underperformed both Bitcoin and Ethereum during the price correction.

Amp (AMP) is a platform for collateralizing asset transfers. Amp’s website says it provides cryptocurrency assets “instant, verifiable assurance for any real-world application.” AMP has smart contract features for collateral.

Source: CoinMarketCap

The chart illustrates AMP’s price range from a low of $0.005748 in late January 2021 to a high of $0.1179 on June 17. The price recently halved in value even though AMP reached its peak after Bitcoin and Ethereum had already corrected from their April and May highs.

The first six months of 2021 have been an exciting and volatile time in the cryptocurrency asset class. Prices skyrocketed before gravity hit the cryptos, nearly cutting the overall market cap in half.

Cryptos offer more value at the current prices, far below the recent highs, and value-seeking investors could be using the correction to scoop up some of the tokens. Meanwhile, the risks remain high in the volatile asset class. Invest only what you can afford to lose, as most of the over 10,500 cryptos will likely wind up as dust collectors in computer wallets. There are diamonds in the rough out there in cyberspace, but the risks remain high even after the latest price corrections.

As we learned earlier this year, parabolic bull markets can take prices higher than rational, reasonable, or logical levels. Corrections can crush prices. It is impossible to pick highs during bullish price moves or lows during corrections or in bear markets.

Having some exposure to the cryptocurrency asset class in portfolios makes sense as the means of exchange reflect technological advances in finance. However, only invest what you can lose because there are many more pieces of coal than diamonds floating around out there.

This article was written exclusively for Investing.comWith many cryptos testing their long-term support levels, it is best to be tactically prepared to take advantage of a...

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Bitcoin Cash: Is another drawdown likely?

AMBCrypto News 27 June, 2021 - 07:00pm

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Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be taken as investment advice

Bitcoin Cash suffered a major setback after its price declined by 80% from its 12 May swing high of $1,642. An additional 50% drop dragged it below its 19 May swing low of $470, but BCH finally cushioned its losses at $390. Broader market relief over the last couple of days pushed BCH north of $470 once again, but the price was still in a sensitive position, at the time of writing.

Source: BCH/USD, TradingView

A fall below BCH’s 19 May swing low of $470 had pushed the price towards $390 – A level last seen in late January. Having recovered from monthly lows on the back of broader market recovery, the 4-hour 20-SMA flipped bullish once again but the formation of an up-channel meant that bulls must be wary of another breakdown.

While BCH did break below the key level of $470, the region stole the spotlight once again. The 20-SMA and lower trendline of BCH’s down-channel both clashed with the aforementioned support level. Moreover, the Visible Range’s Point of Control lay at this very mark as interest for BCH was at its peak at $470 over the stated timeframe.

However, a look at BCH’s indicators pointed to some downside over the coming sessions. The Relative Strength Index failed to breach 50 as weakness persisted in the market. The MACD line closed in on the Signal line while its histogram noted receding bullish momentum.

The Stochastic RSI even indicated overbought conditions and headed back towards the neutral zone. If bulls fail to hold on to the press time-support, the price could drop towards its 28 February swing low of $430, where some stability can be expected.

Bitcoin Cash’s indicators noted some bearishness in the market and the price can move south from its press time value. This might open up a short opportunity for traders. Entry can be set just below Visible Range’s POC at $469, and take profit at its 28 February swing low of $430.

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A business graduate with a keen interest in emerging markets across South East Asia. As a financial journalist, he covered stocks and market reports across Australia and New Zealand as well.

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Bitcoin Price Prediction and Forecast - CrowdWisdom360

CW360 27 June, 2021 - 07:00pm

The current price of Bitcoin is $ 33,370 which is 4.51% higher than it was 24 hours ago. Click for the latest price here

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Crypto Week at a Glance: A volatile Bitcoin continues to dictate market trends

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The Crypto Daily – Movers and Shakers – June 27th, 2021

FX Empire 27 June, 2021 - 12:16am

Bitcoin, BTC to USD, rose by 2.44% on Saturday. Partially reversing an 8.86% slide from Friday, Bitcoin ended the day at $32,355.7.

A mixed start to the day saw Bitcoin rise to a mid-morning intraday high $32,661.0 before hitting reverse.

Falling short of the first major resistance level at $34,299, Bitcoin slid to a late morning intraday low $30,206.0.

Steering clear of the first major support level at $30,068, Bitcoin move back through to $32,300 levels and into the green.

A final hour rally delivered most of the upside on the day.

The near-term bullish trend remained intact in spite of the latest slide back to sub-$30,000 levels. For the bears, Bitcoin would need a sustained fall through the 62% FIB of $27,237 to form a near-term bearish trend.

Across the rest of the majors, it was a mixed day for the majors on Saturday.

Chainlink (+0.21%), Ethereum (+1.11%), Litecoin (+1.47%), and Ripple’s XRP (+0.81%) saw relatively modest gains on the day, supported by a final hour recovery.

It was a bearish day for the rest of the majors, however.

Bitcoin Cash SV and Crypto.com Coin fell by 4.91% and by 4.37% to lead the way down.

Binance Coin (-0.42%), Cardano’s ADA (-0.05%), and Polkadot (-1.56%) also saw red.

In the current week, the crypto total market rose to a Monday high $1,488bn before falling to a Tuesday low $1,127bn. At the time of writing, the total market cap stood at $1,284bn.

Bitcoin’s dominance fell to a Monday low 45.03% before rising to a Wednesday high 48.26%. At the time of writing, Bitcoin’s dominance stood at 47.21%.

At the time of writing, Bitcoin was up by 0.33% to $32,462.2. A mixed start to the day saw Bitcoin fall to an early morning low $32,066.0 before rising to a high $32,485.0.

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, it was a bullish start to the day.

At the time of writing, Bitcoin Cash SV was up by 5.01% to lead the way.

Bitcoin would need to avoid the $31,741 pivot to bring the first major resistance level at $33,276 into play.

Support from the broader market would be needed for Bitcoin to break out from Saturday’s high $32,661.0.

Barring a broad-based crypto rebound, the first major resistance level and resistance at $33,500 would likely cap any upside.

In the event of an extended crypto rally, Bitcoin could test resistance at $35,000. The second major resistance level sits at $34,196.

A fall through the $31,741 pivot would bring the first major support level at $30,821 into play.

Barring another extended sell-off on the day, Bitcoin should steer clear of the second major support level at $29,286.

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