deenfr

24 janvier 2019

Crypto Broker Weekly Rotation Report

Yara Ainsworth

Yara Ainsworth

Responsable Marketing & Communications chez Crypto Finance AG

A propos de l'auteur

This is our Crypto Broker Weekly Rotation Report, directly from the Crypto Broker trading floor to provide extensive insights into the crypto asset market, including quantitative data analysis, macro market comments, technical chart analysis, and rotation (sector) analysis. All in all, this gives a good overview of different practices to help you evaluate different market sectors. A PDF version of the report can be found at the bottom of this page.

Should you wish to receive this weekly report by email, you may subscribe below.

Contents

1 Rotation Analysis

2 Market Analysis

3 Top Ten Comparison

4 Volatility and Correlation Comparison

5 ETHBTC 4h Technical Chart Analysis

6 Market Cap Overview

Glossary

 

1 Rotation Analysis

Finally, the correlation table (see Table 2) is starting to look more meaningful. At least in the top ten rankings, most of the 90 correlation figures have decreased, meaning that they are correlating less to each other. This helps the diversified portfolios out there.

Also worth mentioning is that BNB now correlates negatively as well, alongside TRX.

In the top ten rankings performance was rather positive. Compared to last week, it was actually outstanding. Almost all of the coins show a positive change compared to last week, except for XRP. But having said that, BTC was even stronger, and therefore our rotation call is still performing well. Overall volatility has come off quite significantly. We see double digit losses across most top 10 coins.

You may have noticed on the back of the price actions over the past 3 weeks that we are in a consolidation phase. This is also nicely displayed in our volatility chart (see Figure 1) and the correlation chart (see Figure 2). Especially on the correlation side, it shows that there has been a reallocation or redistribution of tokens, which usually happens when the market is consolidating.

Our main call is still to rotate out of altcoins into BTC. We do admit, though, that the MACD for the « shit coins » (Figure 4) looks positive, and that the smoothed advance decline line is in neutral territory.

 

2 Market Analysis

We have seen another week with interesting developments in many areas of the blockchain industry. This underlines a solid start to a promising 2019. After the first larger price swings last week, the market seems to have found some equilibrium in the short term and is consolidating at levels around a total market cap of $120 bln. The risk, however, remains on the downside. Volumes have not improved yet and the market is required to pick up substantially, ideally above the $4,300 handle in bitcoin terms. Last year made history for being one of the worst years in terms of crypto price development. However, a report published by NY-based SCR shows that bitcoin transactional volume in 2018 actually reached a stunning $3 trillion, outpacing most emerging economy currencies. This is certainly a development we like to see. Blockchain was featured as a disrupting technology in the Tech Trends 2019 report published by Deloitte a few days ago, and it looks like a trend is about to emerge within the financial sector as more banks expand their offering for digital assets. After Vontobel announced crypto custody for institutional investors last week, Swiss private bank Falcon did not wait long to drop the bomb and announce that it has launched direct transfers, custody, and crypto fiat withdrawals of four major cryptocurrencies, namely BTC, ETH, BCH, and LTC, for private banking clients. Yesterday, Wednesday, Dutch bank ABN AMRO also unveiled cryptocurrency storage facilities where customers will be able to store bitcoin and the like in the same online banking environment they use for their day-to-day activities. The number one Swiss central banker, Thomas Jordan, expressed a supportive view in a panel discussion at the World Economic Forum (WEF) in Davos, where he acknowledged blockchain as a very powerful technology, and denied the fact that it could be a threat to monetary policy.

Furthermore, according to CEO Patrick Byrne, Overstock.com’s long awaited security token trading platform (tZero) is scheduled to go live by the end of this week, and, hence, meet the timeline that was given last month. Strong conviction also came from Japan as Tokyo-listed internet group Digital Garage announced Monday that it has launched a new platform, which would allow app development on Blockstream’s inter-exchange settlement network called Liquid. The feature makes use of so-called « atomic swaps », the ability to make cross-blockchain transactions without manually converting assets. In the hope to clear the ETH Constantinople fork debacle, core developers of the Ethereum network have proposed to roll out the much awaited software upgrade in late February.

 

3 Top Ten Comparison

Table 1: Data source: Coinmarketcap; change to last week in parentheses
Table 1: Data source: Coinmarketcap; change to last week in parentheses
Table 2: Data source: Coinmarketcap; change to last week in parentheses
Table 2: Data source: Coinmarketcap; change to last week in parentheses

 

4 Volatility and Correlation Comparison

Figure 1: Volatility comparison; Data source: Coinmarketcap
Figure 1: Volatility comparison; Data source: Coinmarketcap
Figure 2: Correlation comparison; Data source: Coinmarketcap
Figure 2: Correlation comparison; Data source: Coinmarketcap

 

5 ETHBTC 4h Technical Chart Analysis

Figure 3: Data source: Bit1nex; Chartsystem: Tradingview
Figure 3: Data source: Bit1nex; Chartsystem: Tradingview

ETH is still looking weak

ETHBTC continued its decline over the past 7 days. We moved closer to the recent low, which, for now, is just 3.7 percent away. Long positions should be on alert mode. We are trading below the red line as mentioned in our last report. To get confirmation, though, we will wait to see where the weekly candle will close. A closing below the red line will increase the chance of pushing down further toward the recent low.

Unfortunately, there is not much to add to the current chart. The structure looks weak and we are in danger of printing a weekly close below the red line. Our call for rotating out of altcoins into BTC still stands. One last comment (or warning) points to the MACD for the « shit coins ». We are still seeing some sign of strength as it trends in bullish territory.

 

6 Market Cap Overview

Figure 4: Market capitalisation overview; Data source: Coinmarketcap
Figure 4: Market capitalisation overview; Data source: Coinmarketcap

 

Glossary

Advance Decline Line – the Advance Decline Line shows the ratio of coins for which the market cap increased relative to the market cap of BTC for each day.
ATH – all time high (maximum lookback period of 730€ days).
Data Source – tables and charts are based on daily close prices provided by Coinmarketcap.
EWMA – exponentially weighted moving average.
MACD – moving average convergence/divergence is a popular technical indicator to identify trends in the underlying instrument. It consists of the MACD and signal line, and the area shown in the background. The MACD line (strong) is the difference of two exponential moving averages, which are defined by the first and second parameter of the indicator. The signal line (weak) is the exponential moving average of the MACD line defined by the third parameter. The area in the background illustrates the difference between the MACD line and the signal line.
Pearson Correlation – quantifies the linear relationship between two variables.
Spearman Correlation – quantifies the monotonic relationship between two variables. As such, the Spearman Correlation is based on the ranked values of each variable and is used to detect non-linear relationships between the two.

Source Section 2 Market Analysisvision&

More information about and contact details for Crypto Broker AG are here.

Download this Crypto Broker Weekly Rotation Report as a PDF

Lire la suite