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Bitcoin Makes Yearly Highs: Where to Next?Starting on the 19th of October, Bitcoin became increasingly bullish, rising in momentum before peaking out around $13,200. The coin is momentarily consolidating between $12,700-$12,800, and appears unable to push higher. The $12,000 Level BTC broke the critical resistance at $12,100, which was the highest resistance level of 2020 so far. This breakout is crucial, as Bitcoin has attempted a breakthrough at this level four times since August, with no success. The last time this level was broken was one year ago when Bitcoin had an astonishing rally of more than 250%. This level also acted as an important support during Bitcoin’s strongest bull-run in December 2017. Where to Next? The current resistance level stands around $13,000-$13,200 (this is where the recent rally stopped). This level was only briefly tested during last year’s rally. Therefore it should not be particularly solid, and BTC will probably have an easier time achieving a breakthrough. The next resistance level stands at $14,000. This resistance stands at the peak of the summer 2019 bull run. Breaking this level will mean that we are in the strongest uptrending market since December 2017, and we have a chance to make all-time highs. We might face a small correction before the bull market continues. If that’s the case, then we can expect BTC to retrace back to $12,000. If the $12,000 level breaks, we could see a retracement to $11,000 or even $9,800. However, judging by the strength of the bullish momentum, it is unlikely that Bitcoin will drop below $12,000 in the near future. Note: It is not recommended to use the 3-Day chart when doing your analysis or trading. We have used it solely to provide a better visual representation of Bitcoin’s price.
Long
by cryptohopper
BAND Offers Multiple Opportunities for a 45% ProfitBAND experienced a tremendous 7,500% growth this year. Following the massive growth, the token experienced a 65% correction starting in September. However, the downward pressure slowed down, and we are now in a consolidation phase. The Opportunities BAND was previously caught in a descending channel on the 4h chart. On the 24th of September, the token broke this channel and entered a consolidation phase. When an asset consolidates, it is usually stable and moves a few percentages at most. BAND, however, is a different beast. Even in its consolidation period, BAND still has a 45% margin from top to bottom, meaning that if you buy at the bottom of the range and sell at the top, you stand to gain 45%. Catching the whole trend is almost impossible. However, even by cashing in half of it, you stand to gain over 20% profit. Taking Advantage of the Opportunities There are different ways to take advantage of this consolidation period. The most basic approach is by trading based on support and resistance. The lower range stands around $5, while the upper range is around 7.5$. However, the token doesn’t always reach the bottom or the top, and it usually ranges around the middle. Therefore buying BAND at 6$ and selling at 7$ ensures a decent profit margin with a healthy amount of trading opportunities. Another way of taking advantage of these opportunities is through the use of technical indicators. Momentum indicators are best suited for ranging periods. Some of the most commonly used momentum indicators include: the Stochastics, RSI, Williams %R, and the MACD.
by cryptohopper
1
Is LINK Regaining Bullish Momentum?As a decentralized oracle critical to many DeFi projects, LINK has had a fantastic year in 2020, pushing up gains of 1,000% at its peak of $20. However, since Mid-August, the token has been caught in a descending channel. LINK recently broke this channel, and many people are now wondering whether this is the start of a new uptrend or a temporary move before continuing its downtrend. Read on to find out! When Can we Confirm an Uptrend? After bouncing off the $7.3 support level, LINK broke the descending channel and attempted to break the resistance between $11.3 and $11.85. However, just because it broke the descending channel, that doesn’t necessarily mean that it will now start uptrending. The token may consolidate for a while before beginning an uptrend. LINK made a new high following the bounce at $11.2, just before the resistance. Breaking this resistance is critical, as it will be seen as a higher high and a confirmation that we are in an uptrend and not in a consolidation phase. Looking Ahead: If LINK starts an uptrend, the next major resistance levels on its way to the all-time high are 14$ and 17.5$. If the support breaks and LINK starts a downtrend, then the next support levels stand around $6.6 and $5.7.
Long
by cryptohopper
2
Celcius Experiences Outstanding GrowthCelsius (CEL) experienced an exceptional 300% growth in one month. The coin has now stabilized, and its direction is currently unclear. Celsius Fundamentals Similar to a bank, Celsius (CEL) borrows from one set of clients, lends to others, and profits from the difference between the interest rate. However, CEL mostly works in the crypto space as it mainly borrows and lends in crypto. Additionally, it does not have any government deposit insurance, making it riskier than a traditional bank. Celsius on the Chart Celcius experienced an exceptionally long ranging period this year from July to September. On September 10th, the price finally made a breakthrough, and CEL experienced an outstanding 300% growth in a single month. The coin reached an all-time high of $1.5. CEL is now stabilizing between $1.2 and $1.5. Due to the swift and strong growth, the coin hasn’t created any support level on its way up. Therefore it is now in danger of failing all the way down to the $0.5 and $0.35 support levels. An indicator that you can use to get early buy and sell signals on the daily chart is the MACD. The MACD indicates a buy signal when the histogram turns green and a sell signal when it turns red. The indicator works well to identify bull runs early and sell relatively close to the high. The MACD can be classified as both a trend-following and momentum indicator. Like all trend-following indicators, it tends to perform poorly in ranging markets. Looking Ahead: The MACD is now about to turn red, indicating that the bull run may end. Since no support levels were established, it is better to time your next entry with technical indicators rather than support levels.
HITBTC:CELUSDLong
by cryptohopper
6
Ethereum Edging LowerEthereum (ETH) experienced strong growth this summer, mostly due to its network hosting dozens of DeFi tokens which grew tremendously. ETH then experienced a particularly sharp 30% correction, along with the entire market, about one month ago. The coin is now hovering around the $315-$340 support. Lower Volatility Following the crash, Ethereum experienced a period of reduced volatility, which we can observe through the Average True Range. The Average True Range (ATR) is a volatility indicator that determines the typical value range of an asset for a particular candle. For example, if we are using the 4-hour chart on Ethereum, and we have an ATR with a value of 4, then the expected range for that particular candle is $4. The Cryptohopper ATR is a variant of the ATR indicator that adds a 28 period moving average. If the ATR is above the moving average, then the market is considered to be volatile. If the ATR is below the moving average, then the market is not volatile. Ever since the market crash, the Cryptohopper ATR has mostly indicated low volatility. Therefore when trading in the current market, it is better to keep your profit target tight and make small but consistent gains. What Happens Next? Ethereum is currently at support and may bounce back. However, for a bounce to occur, there needs to be substantial volatility along with the upward momentum. Therefore it is essential to keep an eye on the ATR when taking a position. The first resistance level stands around $390. The next resistance stands at $485, which is this year’s high. If the market takes a turn for the worse and breaks the current support, we could see Ethereum head to $250. This was the resistance level broken by the DeFi bull run earlier this year.
Long
by cryptohopper
SNX Maintains a Bearish OutlookSynthetix Network (SNX) has been one of the most profitable investments this year. However, the token is now facing a bearish outlook. Recap: The Synthetix project is among the largest exchanges in decentralized finance. They have partnered with ChainLink to bring information about asset prices to blockchain without the need of a central party. Synthetix allows its clients to trade cryptos, currencies, precious metals, stocks, and other assets in the form of ERC20 tokens. This innovative system enables clients to "bet" on an asset's price without actually holding it (similar to CFDs). SNX on the Chart SNX rose to its all-time high of $7.75 on September 10, marking a 540% growth from January of this year. However, for the past three weeks, the token has maintained a bearish outlook comprised of lower lows and lower highs. An adequate strategy to identify the short-term direction in the crypto market is the 10 and 30 Exponential Moving Average (EMA) crossover. When the 10 EMA crosses over the 30 EMA upwards, a buy signal is given, and if it crosses the 30 EMA downwards, a sell signal is given. This strategy provides many fake signals in a ranging market, and you shouldn't rely solely on it. However, when the market has a clear direction, the strategy works well in identifying the trend. We have received a bearish signal from this strategy on September 30th. If the price is unable to break the red trendline we drew, then we could use it as confirmation together with the bearish crossover of the 10 and 30 EMA that the token will continue selling off. There has been a reliable support between $3.8 and $3.5, which caused the token to bounce twice. If the price reaches that level again, then there is a strong chance that the token will bounce, especially if the general markets turn bullish. If that level breaks, then we can expect the price to reach the next support level at $2.75.
by cryptohopper
3
How to Identify Ethereum’s TrendEthereum is the second-most capitalized coin in the crypto market, and it is prevalent among traders. One of the most frequently asked questions is, “how do I know when it is trading up?” Let’s review! Ethereum Fundamentals The Ethereum platform is used by developers to build different kinds of decentralized applications, including new digital assets, uncensored web apps, decentralized autonomous organizations, decentralized finance, etc. Ethereum also serves as the platform for more than 260,000 different cryptocurrencies, including 47 of the top 100 cryptocurrencies by market capitalization. Identifying the Trend Identifying an asset's trend is often overlooked by novice traders who attempt to make as much profit as possible by scalping on the 5-minute chart. However, the trend is an essential component of trading. Moving Averages on the 1-day chart usually do an excellent job of identifying the trend. In the chart above, we have used the crossover of the 10 Exponential Moving Average (EMA) and the 50 EMA. When the fast 10 EMA crosses above the 50 EMA, a buy signal is given, and when it crosses below it, a sell signal is given. This strategy is far from perfect, as we can see by the two fake signals in the chart above. However, the other three signals identified a rise in ETH by 183%, 87%, and 165%. You don't need to trade on these signals; however, you can use them to gauge in which direction the market is heading. You can then set up your strategy to trade according to the underlying trend. Looking Ahead: Currently, the strategy has indicated a sell signal, which means that Ethereum may enter a bearish market. It is possible that this signal is fake and that the price will recover shortly. However, you can also take advantage of this by preparing to take long positions with your strategy on the Ethereum leveraged short-tokens such as BTCDOWN or ETHBEAR.
Editors' picks
Long
by cryptohopper
10
Bitcoin Begins RecoveryRecently, Bitcoin has been trapped in a range between $9,800 and $10,500. After failing to break the resistance several times, BTC finally achieved a breakthrough four days ago on September 14. Where to Next? After achieving the breakthrough, BTC’s price has slowly crawled its way up to $11,000. Due to the slow increase of only 4% in two days, BTC has been unable to achieve another breakthrough at $11,000. The price may pull back to the previous resistance level at $10,500 before retesting $11,000. If the market becomes bullish, the price may not even reach $10,500 before retesting the resistance. However, the chances of that occurring are low. If the new support at $10,500 breaks, then we will probably see the price retrace to $9,800, or even further to $9,000.
Long
by cryptohopper
4
Bitcoin Caught in a RangeAfter falling by almost 20% last week, Bitcoin stabilized between the $9,800 and the $10,500 mark. Trading the Range This range offers the opportunity for a 7.5% gain from the lowest point to the highest. As traders, we know that catching the whole trend is impossible and even to catch half of it would be excellent. Taking this into account, we are then looking at a profit per trade of 7.5% * 0.5 = 3.75% (only). A 3.75% profit per trade is not ideal for swing trading. However, it is worthwhile for scalping. If you would like to trade during this range, you may want to stick with small and consistent gains rather than trying to catch large moves. Where Are We Heading? Like any other range, this ranging period cannot last forever, and a breakthrough is (definitely) set to occur in the future. If the current resistance breaks, we will probably see the price head to $11,000 or even re-test $12,000. If the current breaks, a more severe correction may ensue due to the significance of this support level. The price is likely to fall to at least $9,000, if not further. Looking Ahead: It is advantageous to be prepared or even take part in a breakthrough when it occurs. Until then, it is better to focus on the opportunities right in front of you and make the most out of it!
by cryptohopper
2
New Trading Opportunity Emerges on LINKChainlink (LINK) is the biggest decentralized oracle project in the crypto space based on market capitalization. LINK started gaining upward momentum after the general market correction took place a few days ago. The coin bounced off the support at $9, and it is now attempting to break the $12.85-$13.4 resistance. The Opportunity After LINK breaks its current resistance, the next resistance stands around $16.2, 25% away from the current price. A conservative entry would be just above the present resistance around $13.5, with $15.5 as the target. The target at $15.5 is well below the next major resistance level, and it is likely to be hit if the crypto market recommences a bull run. This opportunity, from $13.5 to $15.5, offers a potential profit of almost 15%. As the trader, you are the ultimate decision-maker and have to decide whether this opportunity is right for you. Looking Ahead: The coin has just been rejected for the third time by this resistance level. Therefore, if the breakthrough does take place, it will be all the stronger.
BINANCE:LINKUSDLong
by cryptohopper
7
LEND Offering Excellent Entry OpportunitiesAAVE (LEND) is among the most capitalized DeFi tokens. After a remarkable 5,000% run, the coin seems to be in a correction phase, which provides an excellent entry opportunity for investors looking to increase their DeFi holdings. Recap: AAVE is an open-source and non-custodial protocol that allows clients to borrow and lend a wide range of cryptocurrencies with variable and stable interest rates. AAVE has a unique system that allows for rate switching, enabling clients to switch between "stable" and "variable" interest rates. The platform's native token "LEND" provides discounted fees for holders. The platform uses 80% of the fees earned from borrowing to burn LEND tokens. This process leads to an increase in demand and a decrease in supply. LEND on the Chart The token reached its all-time high on August 26th, 2020, when it peaked at $0.9. However, the coin has lost 30% of its value over the past week. LEND is particularly volatile and has had several corrections this year, ranging from -30% to -70% in March this year. We have identified three main support levels where the coin may bounce: Support 1 $0.5: This level was the resistance when AAVE hit its previous all-time high in January 2018. It has been briefly tested as a support level in August 2020. It now stands at -44% from the current all-time high. The token has just touched upon this support level, whether it will hold or not remains to be seen. Support 2 $0.38: This level was an important resistance throughout July, which caused LEND to crash more than 40% after reaching it. It stands at -57% from the all-time high. Support 3 0.2$: This support level helped the token bounce after its previous correction, and it currently stands at -78% from the all-time high. Although we can never tell for sure in the Crypto market, at least one of these support levels will likely hold and make the token bounce. The token previously crashed and lost 99% of its value when it dropped from $0.5 to just $0.003 in 2018. However, the probability of a devastating correction is significantly lower now due to the improved fundamentals and DeFi momentum.
L
by cryptohopper
3
HEDG at Support and Ready to Bounce!HEDG is once again nearing its main support level and offers a 110% return! Recap: HedgeTrade (HEDG) is a platform created to improve social trading. Beginners can buy trading predictions in the form of “blueprints” secured by HedgeTrade smart contracts. Although the platform is currently geared towards Crypto’s, it plans to expand its operations to other assets. HEDG tokens are needed when buying and selling a blueprint. HedgeTrade charges a 50% commission fee for any successful blueprint purchases made by users. If a blueprint is unsuccessful, then a 50% commission fee is charged from the blueprint’s creator while the rest is sent back to the user. HEDG on the Chart The main support level around $1.3-$1.1 has caused the token to bounce and turn bullish twice before. You can attempt to enter around $1.1 for the best price point; however, an entry around $1.32 just above the support is likely to get filled while at the same time offering adequate returns. We have set-up 3 profit targets just below resistance levels. You can choose to take out part of your position at each of the targets or take out all of your profit at one of them. The first target aims for a conservative recovery; the second aims for a moderate recovery, and the third target, aims for a full recovery to the all-time high. Managing your risk is an essential aspect of trading. Therefore, placing a stop-loss will ensure that you do not lose all of your hard-earned money on a single trade. Due to HEDG’s particular long wicks and its tendency to temporarily break support levels, a wider stop loss placed at 1$ or less should be appropriate.
HLong
by cryptohopper
Ranging FTT Offers Multiple Opportunities for ProfitThe FTX platform is a major futures platform in the Crypto market, and FTT is the platform's token. The exchange offers many possibilities for futures crypto trading and has created numerous triple leveraged tokens. The company even created futures for the US elections and spot tokens such as TRUMPWINS and TRUMPLOSES. FTT Fundamentals The FTT token has some major fundamental advantages. The FTT platform rewards its clients for holding FTT tokens by giving discounts on trading fees and even making large holders of FTT VIP users (which provide lower fees, account manager, flexible API limits, provide input to FTX products, among other perks). These rewards increase demand over time as the platform gains popularity. Additionally, the company also reduces the supply of FTT tokens by repurchasing and burning the tokens. FTX burns an amount equal to 33% of the fees generated on FTX markets, 10% of net additions from the insurance fund, and 5% of the fees earned from other uses of the FTX platform. When demand increases and supply decreases, the token is bound to gain value. This propelled FTT to grow a whopping 240% since its inception. FTT on the Chart The FTT token usually grows in short bursts followed by prolonged periods of ranging. Although you could profit by just holding the token for a long time, the ranging periods also offer many opportunities for quick profits. The spread between the higher end of the support level and the lower end of the resistance level is 6.5%. Therefore, even if you take a position just above the support and sell just below resistance, you will still profit 6%. If you take more risk and enter the trade at the lower level of support and exit at a higher level of resistance, the profit margin rises to around 12%-15%. The great aspect of this token is that it is usually quick to establish ranging levels after a strong push. This aspect makes it easier to identify a suitable entry and exit.
FTX:FTTUSDLong
by cryptohopper
Tezos is at Support Offering 30% ProfitTezos (XTZ) just hit its all-time high at $4.48 last week. It now stands at support, which was the high during its last bull run in February this year. Let’s take a look at Tezos and its likely forecast. What is Tezos and How Does it Work? Tezos is a platform designed to provide code correctness and safety for both its assets and use cases. The platform’s smart contract language facilitates formal verification, which is a methodology commonly used in mission-critical environments such as the electric power systems, aerospace, and nuclear industries. Tezos's architecture and upgrade mechanism allow the network to propose and adopt new technological innovations as they emerge. This capability enables the protocol to remain up to date regarding innovations without sacrificing community consensus. All stakeholders may participate in network upgrades by evaluating, proposing, or approving changes. Additionally, stakeholders can help to secure the network (via delegating or baking) and avoid being diluted by inflation. Tezos is thus a multi-purpose platform that supports decentralized applications (DApps) and smart contracts. It is similar to Ethereum in nature, and similar to Ethereum, it has an unlimited supply. Tezos (XTZ) on the Chart Last week, XTZ hit its all-time high at $4.48 and currently stands at support. The price may fall further at the support of $3.33-3.15, as displayed by the green rectangle on the chart. If a position is opened just before that support level and closed just below the resistance at $4.3, then it offers an opportunity of around 30% profit. It is impossible to predict all price movements of a coin or any asset in general. Therefore, professional traders always recommend having a stop loss in place at a level where you feel comfortable.
COINBASE:XTZUSDLong
by cryptohopper
BNB Still UndervaluedBinance coin (BNB) is the native currency of one of the world’s biggest crypto exchanges: Binance. BNB is one of the most capitalized coins on the market and it has a fixed total supply of 176.406.561 BNB. Short History Lesson BNB is one of the best performing coins over time, as it outperformed Bitcoin by about 4,800% since its inception in July 2017. Most altcoins hit their all-time highs in January 2018 which was the biggest altcoin season up to date. However, this was not the case for BNB, which continued growing by 85%, hitting highs of 43$ in June 2019. The Current Situation BNB is now situated at the minor $23 resistance and has 15% to cover before reaching its previous 2020 high at just over $27. Apart from the DeFi related coins, very few coins surpassed their January 2020 highs this year. However, BNB is a coin that has regularly outperformed BTC and is therefore likely to do so again. Looking ahead: The next resistance level at $27 is also the BNB’s high during the biggest altcoin bull run in January 2018, and it is, therefore, a very significant level. If this resistance is broken, BNB may become very bullish following the breakthrough. Even if BNB doesn’t break this level, it should at least reach it in the next few weeks if it is to continue its tradition of outperforming Bitcoin.
BINANCE:BNBUSDLong
by cryptohopper
Crypto Trading 101: The Elder RayHi Hoppers! Today we dissect the Elder Ray and learn how to take long positions along with the Parabolic SAR. Without further due, let’s get into the Elder Ray! Elder Ray The Elder Ray is an oscillator with components of trend and momentum indicators to measure the strength of bullish and bearish trends. It uses exponential moving averages to generate signals and pinpoint the dominant power of the market. This indicator labels both trends as “bull power” and “bear power”. When the green sticks are longer than the red ones, the trendline becomes green to indicate that the bullish power is stronger than the bearish power. At this event, the Elder Ray signals a buy. When the red sticks are longer than the green ones, the Elder Ray signals a sell. One drawback faced by the Elder Ray is that it provides too many signals in a ranging market. To improve the oscillator, we have added the Parabolic SAR to work alongside the Elder Ray. Thus, we only take a position when both indicators signal a buy. What is the Parabolic SAR? The Parabolic SAR is a trend-following indicator marked on the graph by black dots. When the black dots are below the price, the Parabolic SAR indicates a bullish market. When the black dots are above the price, it suggests a bearish market. Elder Ray + Parabolic SAR We can use the sell signals from the Elder Ray to close out positions. As the Elder Ray is quick to react to price changes, it is also fast to take your profits before the market turns against you. One positive aspect of the strategy is that it made big wins and small losses (during the short time we analyzed it). If your strategy has a winning percentage of 50%, but the winners make a 3% profit while the losses are at 1%, then your strategy will still be profitable even if you only win half of the time. Have a great trading week ahead, and we will catch you on the next one! —CRYPTOHOPPER—
Long
by cryptohopper
BTC Tests New HighsBitcoin has tested the minor resistance around $12,000, which we identified in the last newsletter. Following Bitcoin's rise to $12,000, BTC re-tested the support between $10,000-$10,500. However, the support was tested by the wick of a single candle, which suggests that the support is solid at that price level. A small support level has started to form around $11,000. However, as seen in the chart, it has been broken already by three candle wicks and does not look particularly strong. Looking ahead: BTC’s price seems to have stopped its upward momentum for now. One possible scenario is that the price falls again and re-tests the support at $11,000 before bouncing upward and heading to $12,000. Usually, after a long period of ranging, like the one we have just had, Bitcoin will likely start trending. Therefore it is probable that BTC will break the resistance at $12,000 and make higher highs in the near future. —CRYPTOHOPPER—
by cryptohopper
Crypto Trading 101: Scalping Trends With DEMAHi hoppers, today we are looking at a scalping strategy that involves scalping trends by combining the DEMA with the ADX. First, let’s break down the Double Exponential Moving Average (DEMA). Double Exponential Moving Average To understand the Double Exponential Moving Average, lets first explore the “Exponential Moving Average”. The Exponential Moving Average (EMA) is one of the most frequently used indicators in the crypto sphere. The EMA is a trend-following indicator that is used to identify the direction of a trend. The EMA reacts quicker than the Simple Moving Average to price changes because the EMA gives greater weight to the latest closing prices. The DEMA reacts faster than the EMA by giving even more weight to recent closing prices. We can use the DEMA on the 15 minutes chart to identify solid entry points. Keep in mind, the DEMA has the same weakness as all trend-following indicators: ranging markets. When the market is ranging, the DEMA will keep opening up new positions. Therefore, it is critical to use another indicator to identify when the market is trending, and when it is not. Now let’s take a look at how to use the ADX to improve the profitability of the DEMA. Average Directional Index (ADX) The ADX is a volatility indicator that measures the strength of a trend. When the ADX is above 25, we can infer that the market is in a strong trend. This can be seen on the graph when the white line crosses above the black line, and the green cloud is active. You can see this better if you click on “Maximize the chart”. We have chosen to run the ADX on the 4-hour chart as the indicator tends to be more reliable on the longer timeframes. For our exit strategy, we have not chosen any indicator. Instead, we have decided to exit based on our usual scalping settings: Take profit 7% Stop-loss 1% Trailing stop loss percentage 1% Arm trailing stop loss 1.5% You can see the positions opened by the strategy better if you click on “Maximize chart”. Have a great trading week ahead, and we will catch you on the next one! —CRYPTOHOPPER—
by cryptohopper
Crypto Trading 101: Trading Bitcoin With The DMIThe Directional Movement Index (DMI) is one of the few indicators that can be used on its own in trading, especially when it comes to swing trading. The DMI can work as a standalone indicator because it is made up of multiple indicators, specifically: the +DI, -DI, and the ADX indicator. Let’s now dive into how these components fit together! +DI & -DI The +DI and -DI are two lines that measure the strength of positive and negative trends. +DI indicates a positive trend, and in our case, it is marked by the color blue on the chart. -DI represents a negative trend, and it is orange in our graph. When the +DI is above the -DI, the bullish pressure is larger than the bearish one. And if the negative line is above, the bears are dominating the market. Therefore, a bullish signal is given when the +DI crosses the -DI upwards, and a bearish signal is given when the +DI crosses the -DI downwards. ADX You may have noticed the positive (+DI) and negative (-DI) lines have crossed many times on the chart, but we have identified only a few signals (indicated by the green circles on the graph). This is because the signals from the +DI & -DI lines are filtered out by the ADX. The ADX identifies the strength of a trend and the volatility in the market. The white line on the bottom graph represents the ADX, while the horizontal black line has an ADX value of 25. Therefore each time the ADX is above the black line, it indicates a strong market trend and volatility. Following June 3, 2020, the ADX filtered out all of the +DI and -DI signals until the 20th of July. Not trading was preferable as the market has been ranging and was not the best time to trade due to the low volatility. We have used the following settings when creating this analysis. Stop Loss: 5% Trailing Stop loss percentage 2% and arming at 7% —CRYPTOHOPPER—
by cryptohopper
Bitcoin Turns BullishBitcoin broke the descending triangle pattern on the 4-hour chart on July 21, indicating a significant and unusual breakthrough. What is a descending triangle pattern? The descending triangle is a bearish chart pattern which is made up of lower highs and horizontal lows, which usually indicates that the demand for the coin is weakening. To draw a descending triangle, the pattern requires at least 2 highs (preferably 3) and 2 lows (preferably 3). In the figure above, we have connected 6 highs and 4 lows. The more candles that can be connected, the stronger the pattern becomes, and the more significant the breakout when it occurs. What does this mean for the market? Bearish Triangles tend to be broken downwards, and a crash usually follows. However, Bitcoin made a bullish breakthrough instead. A bullish breakthrough is when the price breaks the upwards channel and starts making higher highs. Looking ahead: Although this is a significant breakthrough, it does not necessarily change the current market conditions. Because the pattern is mostly visible on the 4-hour and 1-hour chart, it is not as strong as if it were present on the daily chart. That said, this breakthrough does suggest that we are now heading to the resistance at $10,500. Whether we will break this resistance remains to be seen.
Long
by cryptohopper
Cryto Trading 101: Bollinger Bands And VolatilityHave you always wondered how to identify when Bitcoin is volatile and in which direction it is heading? You’re in luck – you can identify both volatility and direction with Bollinger Bands! Bollinger Bands Bollinger Bands are a volatility indicator displayed by a moving average and an upward and lower band. Both bands are typically 2 standard deviations away. When the bands tighten (as it is the case right now), there is less volatility in the market, and a big move is expected to occur soon after. When the bands are very far apart, the market volatility is considered to be very high. The 1-day chart usually works best in determining the overall market volatility and direction. Bollinger Bands can also be used to identify the direction of the market. For example, when the bands are tight, and then the price breaks through the upward band and the EMA points upwards at the same time, the indicator suggests that a bullish trend has commenced. Traders can combine the Bollinger Bands with the RSI crossovers (the RSI with crossovers will signal a buy when the RSI goes from oversold to normal). This strategy works well to identify when the market has recovered from a severe crash and it is marked by the green circles on the chart. In the crypto market, this strategy is typically used on shorter time frames (≤ 4h), to provide more accurate signals. Other indicators that can work well with Bollinger Bands are moving averages. For instance, you can use the Bollinger Bands to find a dip in the market, and then use the crossover of the 1 and 15 EMA to enter a position once the trend is back in your favor.
by cryptohopper
Bitcoin Halving Comparison, So Far So Good!History tends to repeat itself, and the bitcoin halving appears to be no exception to this particular rule. In 2016, during the second BTC halving, the BTC price experienced strong growth before the halving. A bear market followed, consisting of a 40% drop in price from the pre-halving high to the post-halving bottom. Afterward, a lengthy ranging period ensued. Before the third halving that took place in May 2020, Bitcoin also experienced strong growth of more than 150% from $3,800 to $10,000; just like in 2016, a fast crash followed just before the halving. However, the 2020 crash was truncated and nowhere near as severe as the bear market that traders saw in 2016. Based on this comparison, we can infer that a short correction may follow before the bull market commences. Bitcoin is currently experiencing a range. It took BTC around 160 days to break through the highest price before the halving. We currently sit at 67 days after the halving. While Bitcoin cycles are similar, they are not the same. While it would be impossible to predict accurately when the bullish market will start, based on past trends we can predict that it will most likely occur somewhere between 100-200 days after the halving (or 30 to 130 days from today).
BITSTAMP:BTCUSD
by cryptohopper
3
Crypto Trading 101: ATR The Ultimate Volatility FilterHave you made a lot of profit during a trend, only to lose it during a range? With Cryptohopper’s Average True Range (ATR) indicator, you can now safely avoid ranges and only trade the profitable trends. Without further due, let’s take a closer look at the ATR! Average True Range The Average True Range indicator (ATR) is a volatility indicator that increases and decreases in value to reflect the changing volatility of the market. For example, when the market is ranging, the ATR will have a relatively low value, while a high value indicates the opposite. This indicator can be used as a filter for trend-following or momentum indicators. Here at Cryptohopper, we have taken this indicator a step further and added an exponential moving average (EMA) to the ATR to generate volatility confirmation signals on the crossovers between the ATR and the EMA. Within this system, a signal will be created when the ATR crosses the EMA upwards, indicating increased volatility. Another confirmation is generated when the ATR crosses the EMA downwards, displaying decreased volatility. To make the ATR easier to spot visually, our team also added a green cloud for the periods with increased volatility and a red cloud for the periods with decreased volatility. The ATR can work well with both momentum and trend-following indicator, so let’s take a look at what happens when we pair it with an indicator that has both components! Moving Average Convergence Divergence The Moving Average Convergence Trend (MACD) is a trend-following momentum indicator which generates signals on the crossover of two exponential moving averages. When the histogram turns green, a bullish crossover has taken place, and thus a buy signal is given, and when the histogram turns red a bearish crossover has taken place and a sell signal is given. When you combine the MACD with the ATR, you will trade only when the MACD generates a buy signal, and the ATR confirms the volatility as displayed by the blue line on the graph. We have used the following settings in our display of this strategy: Take profit 3% Stop-loss 2%
Long
by cryptohopper