While the cryptocurrency market is expanding, and interest in these assets remains at a high level due to the attention to this topic of the largest world companies, such as Apple, investors are trying to understand what can be expected in this specific market in the near future.
Earlier, cryptocurrency market analysts quite justifiably stated that there are no fundamental factors that could suggest to investors possible directions of the movement of cryptocurrency rates so far. However,the situation began to change gradually. Now, after the boom of interest in these tools at the end of 2017 (when the value of the assets of this market soared up), it is necessary not only to evaluate from a technical point of view the likely dynamics of assets in order to "enter" the market with a high degree of probability, but also to use the manifested interdependencies with the behavior of traditional financial instruments and news flows.
In our analysis, we adhere to the emerging situation of a certain mirroring in the behavior of the dollar and cryptocurrencies traded for the same dollar, as well as the dynamics of the dollar and Chinese yuan, and the behavior of the American stock market.
In our opinion, one should pay attention to the fundamental reasons that drive the exchange rate of the American currency and take them into account in the analysis. A clear weakening of the dollar is supporting cryptocurrencies, but it should be recognized that until the situation with the future monetary policy of the Fed is clarified, we do not expect any specific directional movements. Therefore, we are of the opinion that the general sideways trend will continue until the Fed meeting.
After the opening of Monday trading in the United States, quotes of the cryptocurrency three came under pressure in the wake of positive dynamics in the stock market. Before the start of trading, the pairs including BTC/USD, LTC/USD and ETH/USD rose sharply but also retreated dynamically despite the weakening dollar against a basket of major currencies. We believe that if such market sentiment persists and such a probability does occur, then the dynamics of the three cryptocurrency pairs will be formed in rather narrow ranges until the end of this week.
After the publication of data on inflation in China on Tuesday, which unexpectedly intensified, the renminbi began to grow, which, in our opinion, was the reason for the local increase in the LTC/USD pair. However, while the other pairs - BTC / USD and ETH / USD - did not show activity, these remained in very narrow ranges.
Technical picture and trading ideas:
In the short term, we expect the Bitcoin/USD pair to remain in a wide range of 9295.50-10900.00 in the wake of waiting for news on the topic of the trade conflict between the US and China. Today, it is likely that the pair will remain in an even narrower range of 9967.35-10489.00.
The Litecoin/USD pair has broken out from the level of 70.50 in the wake of the local appreciation of the renminbi against the US dollar. Holding above this mark, it is likely that it will continue to grow to 75.35.
The Ethereum/USD pair still remains in the lateral range 164.80-182.50. However, if it overcomes the level of 182.50, there is a high probability that it will continue to increase to 195.43.
