Amidst a massive plunge of the Turkish lira, cryptocurrencies are increasing in popularity among the country’s citizens – will it impact the prices?
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The market data is provided by the HitBTC exchange.
Turkey is facing a crisis as its national currency is plunging. The 10-day volatility of the lira relative to the U.S. dollar has surpassed that of Bitcoin (BTC). President Recep Tayyip Erdogan has been urging the people of Turkey to exchange their dollars and gold for lira, The Guardian reports.
However, it appears that the savvy citizens of Turkey are exchanging their lira for Bitcoin, evidenced by an increase in the trade volume across cryptocurrency exchanges in the country, according to Forbes.
Though the absolute volumes are still low, the crisis has still shown the importance of cryptocurrencies, which due to their decentralized nature can’t be controlled by governments and central banks. A recent study by Yale economist Aleh Tsyvinski said that an optimal portfolio should park at least 6 percent of its funds in Bitcoin.
Although the overall sentiment in the crypto world is still bearish, the market participants continue to favor Bitcoin, which has increased its dominance above the 51 percent mark.
So, will Bitcoin give up ground or will it pull the altcoins up with it? What do the charts forecast? Let’s have a look.
Bitcoin has been trying to move up for the past two days, but it is facing strong selling pressure close to the $6,500 mark. This points to a probable consolidation between $5,910.65 and $6,500 for the next few days. We will remain positive on the pair for as long as it sustains above the $5,910.65 mark.
Bitcoin will gain strength once it sustains above the downtrend line of the descending triangle. Therefore, we retain the buy call made in our previous analysis.
Our bullish view will be invalidated if the BTC/USD pair sinks below $5,910. The next support on the downside is $5,450, and below that $5,000.
The 50-day SMA has been flat for the past few days, which increases the probability of a consolidation in the near term, whereas the falling 20-day EMA shows that the bulls will make another attempt to break the support zone.
The next couple of days are critical and will provide us with a better picture of the next move.
The past few days have seen a sharp fall on Ethereum and the bears are in no mood to loosen their grip. The pullback attempt on August 12 was met with renewed selling and the bears have resumed the downtrend.
The RSI continues to decline deep into the oversold territory without a trace of buying support. This increases the probability of a fall to the next support at $280.
There is no trade to be taken until the ETH/USD pair stops falling and reverses direction. The first sign of strength will be if the bulls can sustain above the 20-day EMA for three days.
Ripple has continued its journey southwards to the major support of $0.24001. For the past two days, the bulls are trying to hold the $0.288 line, but the recovery has been weak. This points to a continuation of the decline.
The only thing in favor of the bulls is that the RSI is deeply oversold, which suggests that the selling has been overdone and a pullback is due. Any corrective rally will face a stiff resistance at the 20-day EMA and above that at the 50-day SMA.
It is not a good trading strategy to try to catch a falling knife. We shall wait for the decline to end and a bottom to form on the XRP/USD pair before recommending any long positions on it.
As expected, Bitcoin Cash fell close to the critical support of $537.8221 on August 11. We had anticipated a strong support at this level, but the pullback attempt was ultimately weak. Unless the bulls scale the $620 level quickly, a break below $537 is likely.
The next support on the downside is at $400, below which the BCH/USD pair can fall to $300. As the RSI has been in the oversold zone for the past few days, we expect the buyers to step in at the current levels.
$620 and the 20-day EMA will act as a strong resistance on the upside. We shall wait for a new bullish pattern to form before we propose any long positions.
EOS has been trying to hold the $4.8 line for the past two days, but the pullback lacks strength. This shows absence of buying interest at this level. This increases the probability of a fall to $3.8723.
Both moving averages are falling and the RSI has been in the oversold zone for the past few days. This shows that the sellers have an upper hand. Any pullback attempt will meet with a stiff resistance at the 20-day EMA.
We anticipate a strong support in the zone of $3.8723 — $4.3396. We shall wait for the buyers to return before suggesting any trades on the EOS/USD pair.
Stellar has bounced off the critical support at $0.184. This shows demand at lower levels. The pair is range bound inside a large area of $0.184 — $0.477.
The XLM/USD pair has reached close to the 20-day EMA, which is likely to act as a stiff resistance. Both moving averages are flattening, pointing to a consolidation in the near-term.
If the price sustains above the moving averages, a rally to the downtrend line is probable. We are bullish on the digital currency and shall recommend a trade as soon as we spot a reliable buy setup.
Our bullish view will be negated If the bears sustain prices below $0.184.
Litecoin plummeted to an intraday low of $55 on August 11, just below our target of $57. The next level to watch on the downside is the support zone of $48 — $52.
The RSI has entered the oversold territory; hence, a relief rally can’t be ruled out. Any pullback will face a stiff resistance at the 20-day EMA and above it at the 50-day SMA. The LTC/USD pair has not broken out of the 50-day SMA since May 16 of this year, which shows that it has faced selling on every small pullback.
We shall wait for the decline to end and the chart to form a bottom before suggesting any trades on it.
Cardano has been hanging on to the critical support with the skin of its teeth. A break of this can result in a plunge to the next support level of $0.078215.
Both moving averages are sloping downward and the RSI is close to the oversold territory, which shows that the bears have an upper hand. Any pullback will face resistance at $0.13 and above it at the downtrend line.
We shall turn positive on the ADA/USD pair if it sustains above $0.15 for a couple of days. Until then, we suggest traders remain on the sidelines.
Monero has broken into the top 10 cryptocurrencies after a long time, hence we have included it in our analysis.
The XMR/USD pair declined to $87.023 on August 11, from where the bulls are trying to pull back.
On the upside, the 20-day EMA will act as a stiff resistance, above which the upward move can extend to the downtrend line, closer to $130.
On the downside, if the $87.023 level breaks, the fall can extend to the $78 — $82 support zone.
Currently, the virtual currency is in a downtrend. Hence, we are not proposing a trade on it.
IOTA is in a downtrend. Both moving averages are declining and the RSI is in the oversold zone, which shows that the bears are in command. It reached a low of $0.5011 on August 11, where some buying emerged.
Previous declines to the oversold zone on the RSI have culminated in a pullback. Hence, we expect the bulls to defend the psychological support threshold of $0.5.
The potential recovery from the lows will face a stiff resistance at the 20-day EMA and if that level is crossed, the next resistance is at $0.9150.
On the downside, if the IOTA/USD pair slides below $0.5, it can reach $0.45 and below that $0.38. We shall wait for the trend to change before suggesting any long positions.
The market data is provided by the HitBTC exchange. The charts for the analysis are provided by TradingView.