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04 avril 2019

Crypto Broker Weekly Rotation Report CW 14

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.

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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

We spotted it correctly this time around.

Most of the top 10 ranked coins lost against bitcoin. The usual suspects such as LTC, BCH, and ADA were the only coins able to outperform bitcoin. In the lower rankings, 11-50, there were also some outperformers, but the traded volume for those tokens is very small.

Volatility started to move higher, but in our view not high enough. It is not unusual that an undeveloped market, with only a few market players, experiences this type of behaviour. Sometimes, it also happens to emerging market currencies, when market makers are caught on the wrong side and try to « sit it out » by not moving their screens (prices).

On the correlation side, we have not seen much change. If anything, the sentiment is that correlations are getting closer during such volatile times. We still have no clear picture from our MACD and advanced decline line charts. Therefore, we are sticking to our call and keeping our position neutral.

 

2 Market Analysis

In a sudden move on Tuesday morning, bitcoin skyrocketed to its highest level in almost five months, crossing the \$5,000 mark after being stuck at the key $4,200 resistance for a while. Along with bitcoin, we saw a relief in the entire market and a jump in market cap by $26bln to above $170bln. While some altcoins outperformed the « King » in this move up, bitcoin managed to hold on to its market dominance, which remains above 50%. While the reason behind the sudden move was first unclear to many, it now looks like the trigger was a major buy order worth about $100m spread across major exchanges such as Coinbase, Kraken, and Bitstamp. This then triggered a frenzy of computer-driven trading and shorts being squeezed out; hence the magnitude of the move. The fact that the rally has shown some serious staying power up until now can be taken as a positive sign; however, a confirmation of the move is necessary in order to officially call it the end of the bear market. In a longer term, things are also looking quite positive. With an ever-evolving ecosystem and the upcoming bitcoin halving in 2020, which will decrease the block reward and supply, markets are likely to see increasing support in the months ahead.

Infrastructure and platform ecosystems continue to grow and improve. Bifinex has announced that eosfinex beta is now live. With the aim to combine the scalability and speed of EOS with Bifinex’s experience, eosfinex is the first fully on-chain, high performance exchange ecosystem. Also Japan’s top financial regulator approved two new crypto exchanges, with 140 applications still in the pipeline. Other regulators, namely the SEC, still show limited willingness to take a step further as they postponed the decision for two bitcoin ETFs for another 45 days to May 16, 2019. An interesting survey conducted by Grant Thornton shows that more than 60% of 400 CFOs of companies with revenues of at least $100m have already (or plan to) use blockchain within the next two years. This indicates staunch development intentions on the technology side, and, certainly, is a supportive factor for broad adoption. Speaking of which, the Dolder Grand, a leading Swiss 5-Star hotel, recently announced that it will begin accepting bitcoin payments starting next month. Adoption continues…

 

3 Top Ten Comparison

 

4 Volatility and Correlation Comparison

 

5 ETHBTC 4h Technical Chart Analysis

ETHBTC throws in the towel

We mentioned last week that if we break the trend line we will trade lower with an initial target close to the recent lows. This has already happened on account of the fact that the reaction was swift after we broke the trend line. We also did a retest of the breakout textbook-like.

Now, we seem to have consolidated in no-man’s-land. As there has not much volume traded around the price levels further down, we expect the pressure to remain to the downside. The recent low of 0.03000 will work like a magnet with not much resistance.

This call will become invalid in case we move back up above the 0.03360 level.

 

6 Market Cap Overview

 

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&

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