The price of Bitcoin has deviated from its long-term trend, indicating that the flagship cryptocurrency is undervalued.
The price of Ethereum breaks through the notable resistance of the February 2021 high, but volume remains low.
The 200-day SMA and the anchored VWAP provide as formidable resistance for the XRP price.
In the latest stage in their recovery from June 22 lows, Bitcoin, Ethereum, and Ripple overcame minor resistance levels. As the cryptocurrency complex tries to put the second quarter corrections behind it, significant impediments remain, producing technical headwinds.
Meanwhile, the South African financial authority says it has no choice but to impose new restrictions in the wake of a $3.6 billion Bitcoin heist.
According to investigators, Africrypt, a company founded by two South African brothers in 2019, guaranteed a minimum return of five times the money invested, although it appears they only deposited $126,000. The brothers and the Bitcoin valued up to $3.6 billion, according to legal attorneys for concerned clients, have vanished.
Because cryptocurrency is not a regulated financial product, the South African financial regulator says it can’t intervene in the alleged fraud. Instead, the Financial Sector Conduct Authority is limited to investigating complaints and has no regulatory authority.
In reaction to the alleged fraud and other frauds, South Africa is moving quickly to establish digital asset monitoring. The revised regulatory roadmap anticipates a workable framework in six months, based on the belief that “crypto is a financial product and should be regulated as such.”
South African regulators will start with rules for crypto exchanges’ know-your-customer policies and surveillance systems to see if money is being laundered out of the nation as part of the framework. Investor protection guidelines and capital risk management standards will be released later.
Despite the global development in the asset class, cryptocurrency service providers in South Africa have operated without the oversight of regulatory authorities. The new rules are intended to treat cryptocurrencies as hazardous and “ensure that the financial sector is aware of those risks and properly price for those risks,” according to the White House.
It’s another step toward building global asset class regulation. It comes after the Financial Conduct Authority of the United Kingdom banned Binance Markets Ltd. from doing any business in the country over the weekend.
Last week’s comeback from the increasingly crucial $30,000 level was the fifth reminder of how crucial the level is for Bitcoin’s future. The velocity with which the market rebounded indicates the existence and attention of significant investors, especially institutions, who are accumulating positions based on the risk level. Retail investors undoubtedly participated, but it is major investors that can ignite significant BTC rebounds.
Each successful test lays a stronger basis for absorbing unfavorable news, such as the Financial Conduct Authority’s decision to prohibit Binance from operating in the United Kingdom over the weekend.
Willy Woo’s chart below (as of June 22) highlights how huge investors are profiting from pullbacks to the $30,000 range.
Willy Woo is the source of this information.
Last week’s volatility resulted in a bullish weekly hammer candlestick pattern, with Bitcoin closing above the strategically crucial 50-week simple moving average (SMA) of $30,452 and the anchoring VWAP of $33,422. A trade and daily close above the hammer high of $35,741 activated the hammer yesterday. The bullish price action has enhanced the likelihood of BTC seeking higher prices in the future.
The 50-day SMA around $37,768 will provide some resistance. Nonetheless, Bitcoin price could break over the moving average and ascend steadily to strong resistance in the $41,500-43,500 range, which includes the 38.2 percent Fibonacci retracement of the April-June downturn at $42,589. A rally of that size would result in a 25% gain over the present price.
Chart of BTC/USD on a daily basis
On June 22, the neckline of a head-and-shoulders topping pattern was triggered by Bitcoin’s price. Until BTC trades above the right shoulder high of $41,332, the pattern will remain active, increasing the chances that last week’s low was the correction low. Furthermore, when the 50-day SMA crossed below the 200-day SMA on June 19, the digital asset triggered a bearish Death Cross pattern.
Both bearish and bullish trends must be considered while developing and executing BTC trading strategies.
To date, Bitcoin price has shown a complete Elliot five wave down pattern, a weekly hammer candlestick pattern that triggered yesterday, a positive momentum divergence on the daily Relative Strength Index (RSI), and a weekly hammer candlestick pattern that activated yesterday. Furthermore, the Mayer multiple, which compares the price of Bitcoin to its 200-day SMA, indicates that Bitcoin is undervalued in comparison to its long-term trend and that now is a great opportunity to buy.
These elements, together with the support of important price levels, indicate that BTC is poised to perform better in the future.
On June 22, the positive response of Ethereum price to outstanding support framed by the 200-day SMA at $1,878, the 2020 rising trend line at $1,793, the 61.8 percent retracement of the March 2020-May 2021 advance at $1,730, and the May 23 low of $1,728 provided a ray of hope for ETH investors and short term speculators.
The subsequent price movement was not convincing or comparable to recoveries in other cryptocurrencies, implying that ETH remained enslaved by depleted interest and that attempts to break over the February high of $2,041 on a daily closing basis would be a long shot. On June 28, however, the price of Ethereum closed above the February high, signaling the start of a favorable trend toward higher values. Yesterday, the encouraging stride was followed by another strong day.
Other technical levels, such as the 50-day SMA at $2,564, the apex of the symmetrical triangle at $2,730, and the daily Ichimoku Cloud, continue to act as resistance, forming a trifecta of resistance heading forward.
Chart of ETH/USD on a daily basis
On the other hand, if Ethereum price falls below the 2020 trend line at $1,807 and the 61.8 percent retracement at $1,730 on a daily basis, it may test the support created by the 2018 peak at $1,419, implying a 32 percent drop from current levels.
There’s no other way to put it; until this week, Ethereum’s price had been zombie-like, displaying no evidence of relative strength against Bitcoin or other digital assets, keeping projections negative or at the very least neutral. Nonetheless, this week’s strength could be the catalyst that propels ETH out of its funk and onto the path to higher prices.
At the time of the June 22 low, the price of XRP had dropped 70% from the April high of $1.96 and a significant 50% from the June 1 high, liquidating the May 23 bottom of $0.652, a level bolstered by weekly highs in late 2020 and February 2021. Ripple, on the other hand, hit three key technical milestones that triggered a 43 percent rebound: a test of the 78.6 percent retracement of the December 2020-April 2021 advance at $0.555, an undercut of the 50-week SMA at $0.540, and a daily RSI reading that was oversold for the first time since late December 2020.
On June 28, the XRP price outlook was boosted by the fact that Ripple finished the week barely below the May low of $0.652 and in the upper half of the weekly trading range. This is a significant improvement from last week, when the price of XRP appeared to be on the verge of testing the 200-week SMA at $0.449.
Yesterday’s near-double-digit gain pushed the price of XRP above $0.652 and pushed it closer to the 200-day SMA at $0.730. The increase fell short of the anchored VWAP from December 29, 2020, which stands at $0.740, as well as the severe opposition defined by the neckline of a multi-year inverse head-and-shoulders pattern, which stands at $0.760.
As previously indicated, the price of XRP will not be free until it closes over $0.760 on a daily basis. Ripple can expect a rally to the 50-day SMA at $0.952 and possibly to the psychologically crucial $1.00 if this is reached.
Chart of XRP/USD on a daily basis
The growing rebound below $0.760, on the other hand, could be forming a bearish flag formation. A weekly closing below the 50-week SMA at $0.551 could be triggered if the negative trend continues. If the price of XRP closes below $0.551, it might indicate a complete reversion to the mean, with the 200-week SMA at $0.451 being tested. A drop to the mean would represent a 33% drop from the current price.
XRP price may opt to trade between the 50-week SMA at $0.540 and the resistance around $0.740 in the coming weeks. The swelling support and resistance levels, as well as the ensuing 30 percent profit potential, would provide great trading circumstances for swing traders./n
