Technical Weekly - Bitcoin bulls on thin ice; Altcoins mixed

Cryptocurrency traders have been staying cautiously optimistic as we enter the final trading month of the year. The prices of bitcoin briefly touched 7800 levels over the weekend before sheltering in the 7500 area. We've also seen the same mixed sentiment in the altcoin space, as ETH and XRP gained about 1.5%, while LTC and ATOM gave up less than 2% of their values.

The mixed sentiment in the crypto market also illustrated in market data. Data from OKEx shows that futures contracts traders have been holding a split view on BTC, with the Long/Short Ratio hovered in the 1 area.

However, another set of data shows that investors have been reluctant to enter the market despite market sentiment has slightly rebounded. The latest reading of the Sentix Bitcoin Sentiment Index has rebounded from last week's -34 percentage points to -22percentage points.

Patrick Hussy, Managing Director at CEFA, believes that "fears remain in the market that the sell-off could continue." Although extreme fear usually indicates a price rebound, Hussy said he hadn't seen indications that show investors' willingness to buy. Bitcoin bulls may have to be patient before the next significant price increase can take place.

US investors are expected to return into the market as Thanksgiving weekend wrapped up, crypto watchers may want to refocus on the overall trade volume, and the potential changes in the momentum and market dynamic.

 

What You Missed

• Facebook's Libra project may face additional regulatory hurdles as US laand ATOM gave up less than 2% of their values.wmakers have been pushing to classify stablecoins as securities. The obstacle came at the time when Libra has been in consideration of embracing fiat-pegged stablecoins model, rather than a single token supported by a basket of national currencies. Libra Association insisted that the project is a commodity.

• Banks in Germany may soon be allowed to sell and store crypto assets. That's according to a local newspaper. Handelsblatt reports that the Bundestag has passed a new bill that implements the fourth EU Money Laundering Directive, which allows banks to have access to crypto-assets. The bill is expected to be signed off by the nation's 16 states.

• Investors in Canada are one step closer to see public-traded bitcoin funds as soon as late December. Canadian investment fund 3iQ told Coindesk that the company is expected to list the fund on TSX or TSX Venture in late December or early January. The firm claims the IPO would be the "world's first regulated closed-end bitcoin exchange-traded product."

 

Price Analysis

BTCUSD

• As previously discussed in our publication <Bitcoin Prices Rebounded, So What's Next?>, BTC could have needed to find another bottom support of the recent uptrend (red tunnel) before retesting the October resistance (yellow line).

• BTC seems has found another 3-hour leg of support, which is higher than the previous lows. At this point, the 23.6% Fibonacci Retracement must be further tested before another attempt at the upper end of the uptrend.

• We believe that momentum would be the key of BTC to hold up at current levels or further push up, as both UO and RSI suggest that momentum has been somewhat losing out.

• If the lower end of the channel is compromised, the retest of the support near 6850 should not be ruled out.

• Key levels: 7455, 6850

EOSBTC

• EOSBTC has formed a 6-hour double bottom reversal in late November and started a rally from there. A similar pattern has occurred back in early November, which sent the price to nearly 0.0004 levels.

• The thin confidence in the BTC should able to provide some rooms for altcoins speculations, and EOS could be one of them.

• If the momentum is sustainable, the pair could test the 0.00039 area, which is the support- turned-resistance levels.

• Besides, the 6-hour 10-SMA has surged above the 50-SMA recently, it has been getting closer to the 200-SMA, and a 6-hour "golden cross" could be in the making.

• Key levels: 0.00039, 0.00037

ATOMUSDT

• ATOM has been one of the recent gainers in the altcoin space, as ATOMUSDT has been rally since November 22.

• However, we've seen a mixed signal from here. While the lower end of the 3-hour rally channel seems like decent support, the ultimate oscillator was unable to produce some higher lows. At the same time, the RSI has made a more obvious rebound.

• The chance of retest the support of the uptrend should not be eliminated; however, the double top formation could limit the upside from here.

• Key levels: 3.6, 4.1

LINKUSDT

• LINKUSDT is set to test the support of a long-term trend line. The green line in the chart below is the support of the pair, which started in May 2019.

• Momentum indicators and the price have shown divergence since mid-October, an expected price correction occurred in mid-November.

• The correction also makes the case of a daily "death cross" more likely, which is the 10-day moving average is likely to break below the 200-day moving average. However, unlike the name suggests, a short-term price rebound usually occurs after a death cross happened shortly.

• Key levels: 2.36, 2.02, 2.01.