The cryptocurrency market has been making history for all the wrong reasons as of late, most notably by recently surpassing the plunge of the infamous Dot-Com bubble in the early 2000’s.
With that said, cryptocurrencies tend to make recoveries when all hope is seemingly lost, and today’s price action of the world’s second largest cryptocurrency, ether and many others is no exception.
Zum Zeitpunkt der Drucklegung, several of the top 10 cryptocurrencies by market capitalization are reporting 24-hour gains above 10 Prozent, including monero (XMR), Litecoin (LTC), und EOS. Äther (ETH) is leading the pack while boasting a 17 Prozent Preiserhöhung.
Immer noch, it’s too early to call any type of long-term bullish reversal in the market, but there are three encouraging signs cryptocurrencies may see much-needed relief at least in the short term.
1) Ether Recovery
Until today, the price of ETH/USD had fallen more than 40 percent since September 5 und 85 percent from its all-time high north of $1,400 set last December.
Today though, tells a different story. Since the low of $167.32 gestern, price has recovered more than 20 percent reaching a 24-high of $207.67, according to data form the Bitfinex Exchange.
ETH/USD Daily Chart
Wie in der obigen Tabelle gesehen, the recent price recovery can be attributed to finding support on the lower trend line of a falling wedge, a bullish reversal pattern, in a historical support zone depicted by the green box.
Des Weiteren, the daily RSI was showing bullish divergence, giving all the more reason for a relief rally to occur.
In order to provide confirmation of a larger trend reversal, price would need to close a daily, more preferably a weekly, candlestick above wedge resistance with a notable increase in volume.
A common method of estimating the breakout target of a falling wedge is to add the base range to the breakout point. Since the base range of this wedge is over $900, a long-term measured objective for price would be in the $1100 area if price were to break out near $230.
Many alternative currencies are built on the ethereum blockchain, so a strong recovery from ETH would likely translate to a recovery for others as well.
2) BTC Short-Term Strength
The future prospects for cryptocurrencies in general are heavily dependent on bitcoin (BTC) – the world’s largest cryptocurrency by market capitalization.
Down 70 percent from the record high of $20,000 reached in December, BTC could scare the most seasoned investor. jedoch, a closer look at the long duration technical chart reveals the cryptocurrency is silently charting a major bullish reversal pattern.
Wie man sieht, BTC’s recovery from the low of $5,859 in August established the first higher low pattern of the year, the previous low being $5,755 hit in June. Des Weiteren, the recent sell-off ended at $6,119, meaning another higher low has been created.
The trendline connecting the higher lows indicates long-term bearish exhaustion. Daher, there is reason to be optimistic as long as prices hold above the trendline.
What bulls need now is for BTC to set a higher high by moving above the July high of $8,507. That would confirm a long-term bearish-to-bullish trend change and could yield a sustained rally above $10,000.
3) Risk Appetite in Global Markets
Risk assets across the globe have picked up a bid in the last 24 hours on Berichte that the U.S. and China are heading back to the negotiating table.
Zum Beispiel, the AUD/JPY pair, which is widely considered as a risk barometer of global markets, ist oben 1 Prozent bei Redaktionsschluss. inzwischen, the dollar index is down 0.24 Prozent.
Deutlich, investors are hoping that these talks would yield results, jedoch, trade wars would end only if the U.S. officially drops tariffs. More importantly, the past experience suggests such talks tend to break down in a few days.
Das gesagt, the renewed hopes of the U.S.-China trade talks could keep the risk assets well bid in the short-term.
Des Weiteren, Truthahn hiked rates durch 625 basis points today to save its stumbling currency and the move has pushed equity markets higher across the globe.
All of this will likely bode well for the cryptocurrencies as the investor community still considers bitcoin and other innovations as risk assets.
Bekanntgabe: Der Autor hält BTC, AST, REQ, OMG, TREIBSTOFF, 1st und AMP zum Zeitpunkt des Schreibens.
Bull-run via Shutterstock; Charts via TradingView
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