Fake Bearish Movement!
Today digital coins are suffering from selling pressure. That started last Friday afternoon. The day was faring fine for the crypto world until FED chair Jerome Powell answered a question about digital currencies at a forum in Zurich. His stance against the digital currencies sparked a sharp drop with heavy volume on all digitals. After the drop, the price recovered during the weekend. Early, today the selling pressure began again, although now cryptos are retracing most of that price action. Bitcoin is -2% off its 24H price, but the altcoins behaved better and EOS is up +8.13%, Bitcoin cash + 5.48%, Tron +3.41%, Litecoin +1.7%, Ethereum +0.87% and Ripple +0.61%. Nonetheless, Bitcoin dominance is still close to 70%, although it receded a bit.
The news front was marked by two main news. Jerome Powell answered a question about a possible digital dollar with "It's not something that we are actively considering. For us, it raises significant issues that we would want to see resolved."
Powell's view diverges from the one expressed by BoE Governor, Mark J. Carney last August 23 at the Economic Policy Symposium in Jackson Hole, Wyoming. There, Carney said "It is an open question whether such a new Synthetic Hegemonic Currency (SHC) would be best provided by the public sector, perhaps through a network of central bank digital currencies."
The other news piece was Bakkt's BTC custodian service in preparation for its BTC Futures contract settled in bitcoins instead of its USD equivalent price. This measure is said to improve BTC price discovery and better liquidity.
Technical Analysis
Bitcoin (BTC)
Bitcoin has recovered all the losses in the last 24H as it is creating an engulfing pattern on high volume. As of this writing, the price is above the $10,400 support level and, although the MACD is still in a bearish phase, the power of this price action is enough to see that this downward movement was a fake bearish movement. The price was rejected from the bullish trendline, acting as support and now moves above the 50- period MA. If the price action continues, it will also create a bullish transition of the 50- period MA and the 200-period MA.
Bitcoin Cash (BCH)
Bitcoin Cash is in a bullish phase with higher highs and lows. The MACD confirms this price action as well. We see also the 50-period MA( blue) has turned up and is meeting with the 200-period MA. We see this digital pair currently at resistance levels but is the price crosses convincingly the $312 level it should continue moving up to $325 and $353. Its next resistance levels. BCH current supports are $298 and $284.
EOS
Eos has been very bullish lately although right now we see that it is bouncing off of its $3.8768 resistance level. We see the price bullish, as it is creating another engulfing pattern with strong volume. The MACD also confirms this view. The next target, after overcoming this resistance is $4.13. Its nearest supports, as shown in the chart, are $36544 and $3.5288.
DASH
DASH has recovered almost 100% of its last heavy drop that occurred end of August. The price is now close to touching resistance (89.41) which signals the beginning of that drop. We think the price needs a consolidation before continuing, maybe revisiting the $85 level. Today the digital pair DASHUSD is strong as most of the cryptocurrencies. However, to play long, better wait for consolidation.
Author
EagleFX Team
EagleFX
EagleFX Team is an international group of market analysts with skills in fundamental and technical analysis, applying several methods to assess the state and likelihood of price movements on Forex, Commodities, Indices, Metals and
