[Bitcoin (BTC), Ethereum (ETH) – Down But Not Yet Out]

1 hour ago, MongiIG said:

Ethereum, Bitcoin Price Analysis: ETH/BTC Bullish Continuation Setup.

ETH/BTC ANALYSIS:

• Bitcoin declines 30% from recent high compared to Ethereum at 18.5% measured at current levels
• ETH/BTC technical set up looking to take advantage of Ethers relative strength versus Bitcoin

 

CRYPTO ASSETS AND INFLATION HEADING INTO 2022

Crypto markets in general have seen some phenomenal price appreciation due to its large appeal as a hedge against inflation. While inflation persists, measure to combat it are being talked up more and more and major central banks, such as the Fed, have started to recognize the longer term effects of persistent inflation. Rates markets have stepped up their expectations of interest rate hikes into 2022 although, such expectations have proven to change - or self-correct – in response to central bank policy statements or evolving news surrounding the Omicron variant.

With much of the focus on controlling inflation, major crypto assets like Bitcoin and Ethereum have pulled back from recent highs but Ethereum looks to have weathered the storm better than its counter-part, Bitcoin. Ethereum has dropped 18.5% from the recent high compared to more than 30% decline in Bitcoin.

ETHEREUM HOLDING UP DURING LATEST DECLINE

While exhibiting a short term directional move lower, Ether remains within the longer term uptrend as the ascending trendline - acting as support – remains intact. As long as this remains to be the case Ether bulls may view a bounce off support as an opportunity to re-enter the longer term uptrend, either via ETH itself or via the ETH/BTC pairing.

With this being said, the potential for an extended lower move cannot be ruled out. The MACD has just moved below the zero line so pre-empting the move should be avoided.

Ethereum (ETC) Daily Chart

Chart prepared by Richard Snow, IG

BITCOIN DROPS NEARLY ONE-THIRD FROM RECENT HIGH

When compared to Ether, Bitcoin has seen a more drastic decline since the recent high and subsequently broke below the ascending trendline. The largest cryptocurrency by market cap trades just below the psychological level of 50,000 which remains the nearest level is resistance. Subsequent failed attempts at the 50,000 may be symptomatic of further future declines.

Bitcoin Daily Chart

Chart prepared by Richard Snow, IG

ETH/BTC TECHNICAL SETUP

A stronger Ether relative to Bitcoin establishes the potential for a bullish move in ETH/BTC as the pair tests the prior high (March 2021) at 0.08160. A bounce off this level could see the pair move back towards the all-time high which printed just a few days ago.

Ethereum/Bitcoin (ETH/BTC) Daily Chart

Chart prepared by Richard Snow, IG

 

Written by Richard Snow for DailyFX.com. 13th December 2021.

It's not a great time to short Eth/Btc pair, but there will be very soon.
Eth has not delivered since inception. 

Investors surely have enough believe in it. That's because it is PoS and not PoW.
There is no fundamental knowledge from investors tho. 

In reality, Eth can easily be considered a synthetic CDO of crypto. 

There are so many bets on a bet. 

Eth has a marketing team. This says it all. Eth is run by humans. And as humans, we have to take into account imperfections. 

The gas fees inconsistency is the proof. 

https://ethereumprice.org/gas/

 

 

eth.jfif

[A Bullish Gold vs High Inflation.]

7 minutes ago, MongiIG said:

Hi @Broxer93

Thanks for sharing your view on gold.

The following article by Seth Levine, I found to be an interesting read on gold, full article: How gold lost its inflation luster.

 

Gold no longer protects against inflation

Gold’s primary investment use is to hedge portfolios against inflation risk. However, the data simply doesn't support this thesis as sound. Gold’s price weakly correlates with common measures of inflation and is far more volatile these days.

 

Change In Gold Price vs Change In CPI

 

 

Gold Price vs CPI

 

Gold’s price weakly correlates with common measures of inflation and is far more volatile between 4/69 and 10/21. Source: FRED

As the charts above illustrate, gold’s price bears little resemblance to today’s most popular measure of inflation—the consumer price index (CPI). An effective inflation hedge would move in (near) lockstep. It should rise and fall along with inflation. Gold’s price movements, however, don’t. They are more volatile and mostly move independently of inflation, apparently driven by other factors.

 

Gold Break evens

 

Gold’s price does not correlate with inflation expectations either. Source: FRED

Nor does gold’s price correlate with inflation expectations, as shown above. Here too, gold’s price would rise and fall along with the market’s outlook if it were an effective hedge. However, no relationship exists.

 

By Seth Levine, 28th November 2021. Full article: How gold lost its inflation luster.

Ace!

[A Bullish Gold vs High Inflation.]

This is a great article.

If Gold can't hedge against inflation when it's at 6.7% (and that's only the official data, it's actually more), how can this be considered a hedge ?

Gold is down 7% since April 1st 2011. 

Gold is not a hedge for inflation. It's a fact.

[Bitcoin (BTC), Ethereum (ETH) – Down But Not Yet Out]

Support and resistance levels do not take into account what are the supply/demand dynamics.

Officially last night, GMT, 90% of Bitcoin supply has now been mined. 

Exchanges are at a 3 years all time lows. And hash rate is at now at ATH, which makes Bitcoin harder than ever to mine. 

Short term price action is not particularly relevant. 

Market is completely irrational atm and most of the coins are sold at loss which highlights the panic the market is facing atm. 

 

 

[A Bullish Gold vs High Inflation.]

Gold is getting demonetized.

What should have been the hedge for inflation has not ultimately been such in the greatest inflationary period we've had since 1920. 

Gold is manly held by Governments. Also, is an asset that you hold on "paper", without actually owning it. Gold is slow, it takes great force to defend, and you cannot hold physically, even if you wanted, more than a certain quantity. Which makes it obsolete.

No big company with future market is buying gold. Not even those who mine gold want to hold on to it. 

Gold forecast? Gold will be depriced until meets its real value. A great metal. Better than silver, but not more than that. Hence why I am short since 2020. And further shorted every time it moved up. Ended up being right every single time. Time will tell us if I am correct or just a fraud.

[A Bullish Gold vs High Inflation.]

Ahhh you'll get so disappointed 😀