Christmas has come and gone and we are now just a few days short of saying goodbye to 2022 — a year that many cryptocurrency investors and traders would perhaps best like to forget.
What Happened: Since it is possible to trade Bitcoin BTC/USD, Ethereum ETH/USD and Dogecoin DOGE/USD during the holidays, it is pertinent to consider how to approach digital assets during the holiday season.
Benzinga discussed holiday cryptocurrency trading and the upcoming year with OANDA Senior Market Analyst Edward Moya and Amsterdam-based cryptocurrency trader Michaël van de Poppe.
Major Coins During Holidays: Moya said that Bitcoin’s performance will benefit from standard holiday trends but the likely focus will be on whether the U.S. Federal Reserve is nearly done with raising rates. On Ethereum and Dogecoin, Moya said, “Ethereum will eventually trade on technological adoption but for now it will follow whatever cues Bitcoin takes from the broader markets.”
Dogecoin interest is “fading,” according to Moya but it could get a “boost if Musk follows through on plans to make dogecoin an accepted form of payment.”
“If Twitter does come out with their own wallet, that could be good news for dogecoin, but mainstream acceptance still seems unlikely.”
Expect the Unexpected: Van De Poppe has some advice on how to trade coins during the period of time when trading volume usually is on the lower side.
“The only expectations were given that Bitcoin would be trending south and go lower, while social media remains to be significantly negative across the board. That’s usually a good period to start investing into the actual asset,” said Van De Poppe.
However, Van De Poppe suggested inexperienced traders to avoid periods with volatility and when volumes are significantly low.
“Organic price action has often disappeared and that’s why you see those ‘chops’ taking place in which price moves sideways for days, after which it drops by a few percent in 1 minute and it goes back into sideways notion. Avoid trading during these times.”
The trader advises instead to hold for a minimum of 3-6 months and build the ability to “learn and digest” information about markets.
“Evaluate your emotions and behavior during the past few years and start building. Right now is not the time to be trading, but right now is the time to be educating yourself so you will be a better trader during the better times.”
Buckle Up For A Bumpy 2023: The two analysts share their thoughts on how 2023 will pan out for the trio of Bitcoin, Ethereum and Dogecoin. Moya advised investors to brace themselves for a bumpy ride. “Buckle up, it will be a bumpy ride. Crypto is not trading on its own fundamentals and the broader markets could see enhanced volatility as uncertainty persists on whether the economy will have a recession or soft landing.”
Van De Poppe doesn’t see either Bitcoin or Ethereum to be making new all-time highs in 2023. He said, “What I think we’ll be seeing is a case of a relief rally, in terms of 2019 perspectives. In that way, Bitcoin could run towards levels at $35-45K, to correct afterward. This would mean that Ethereum can come back towards $2,500-3,000 as well and show significant strength.”
Macroeconomics and regulation could be the two large influencers of Ethereum price action next year, according to the analyst.
Ethereum “would be showing more strength in the coming bull cycle as the fundamental growth through PoS will be starting to be seen. Remember, 2017 was also driven through Ethereum, now probably we’ll see it again.”
On Dogecoin, Van De Poppe says he has “no idea” if the market is going to run upwards.
However, the trader concurred with Moya on the Elon Musk effect — “I think that the crucial variable of Dogecoin lies in the hands of Elon Musk, whether or not he’ll be deciding to integrate Dogecoin into Twitter.”
Clean Up In Store: 2022 was dominated by the unraveling of LUNA Classic (LUNC), FTX, and other cryptocurrency platforms. The two analysts expect 2023 to be the year when regulations will take center stage.
“Crypto regulation and investigations will be the dominant theme, and if any fresh strains hit the crypto market, downward pressure could resume. Regulation could prove to be troubling for stablecoins or with crypto exchanges. 2023 will be the year lots of corrupt parts of the crypto market get cleaned up,” said Moya.
Bitcoin (BTC) values have been on sea-saw in 2021, but they will end particularly on a higher note than where they began. Considering the position, it was in January 2021, Bitcoin is trading just below $49,000, representing a 66% rise. However, it is still 30% less than the all-time high of $69,000, which BTC touched in November, reports CNN.com.
So, what’s next for Bitcoin, ETH, and other cryptocurrencies?
Cryptocurrency has become an essential element in the present financial regime. Despite diverging views about crypto assets, the fact that total cryptocurrencies in circulation today stand at $2.2 trillion is by itself a testament that it has come to stay. BTC accounts for a significant chunk of the crypto tokens in circulation and equals $920 billion.
The other major player is Ethereum which also closes the gap with the number one token. Ethereum is also popular crypto for intelligent contracts and nonfungible tokens (NFT). NFT has taken the art world by storm and has a total market value of $475 billion. Ether (ETH) values have also surged, and its values have more than quintupled this year, from around $730 per coin to nearly $4,000.
There are several Bitcoin ETFs or Exchange Traded Funds, and investors can choose any one of them. In addition, other Crypto Tokens could also be contemplating ETF investments following the path of BTC.
CNN quoted Nick Elward, senior VP at Natixis Investment Managers, saying, “The next possible step is for additional ETFs for other coins to launch. For example, there probably will be Ether ETF in early 2022. There probably will be an ether ETF in early 2022.”
Major financial players, institutional investors, and top fund managers George Soros and Stanley Druckenmiller have invested in crypto. However, one factor that affects cryptocurrency is its extreme volatility. The current tanking of prices of BTC and ETH is a stark reminder of the unstable nature of the crypto market.
Less severe crypto winters ahead?
Investors had rushed to buy BTC in 2017, and the prices surged from $1,000 to $20,000 by the end of the year. Then came the crash of 2018 when BTC prices plummeted to $3,500. It took almost two years until December 2020 for prices to reach $20,000 again.
Prices of BTC again surged in 2021 till April this year when values plummeted, and it was mayhem in the crypto market. The crash was precipitated by several factors, including increased calls for regulation and the banning of crypto mining in China. Ecological concerns also gave a bad name for cryptocurrency mining.
Such wild swings are a common occurrence in the cryptocurrency market. The key is to fathom these ups and downs and ride them to safety.
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Bitcoin (CRYPTO: BTC), Dogecoin (CRYPTO: DOGE) and Ethereum (CRYPTO: ETH) have developed inside bar patterns on the daily chart. An inside bar pattern indicates a period of consolidation and is usually followed by a continuation move in the direction of the current trend.
An inside bar pattern has more validity on larger time frames (four-hour chart or larger). The pattern has a minimum of two candlesticks and consists of a mother bar (the first candlestick in the pattern) followed by one or more subsequent candles. The subsequent candle(s) must be completely inside the range of the mother bar and each is called an “inside bar.”
A double, or triple inside bar can be more powerful than a single inside bar. After the break of an inside bar pattern, traders want to watch for high volume as confirmation the pattern was recognized.
- Bullish traders will want to search for inside bar patterns on stocks that are in an uptrend. Some traders may take a position during the inside bar prior to the break while other aggressive traders will take a position after the break of the pattern.
- For bearish traders, finding an inside bar pattern on a stock that’s in a downtrend will be key. Like bullish traders, bears have two options of where to take a position to play the break of the pattern. For bearish traders, the pattern is invalidated if the stock rises above the highest range of the mother candle.
See Also: Dogecoin, Bitcoin, Ethereum See Buying Opportunity After Another China Crackdown
The Bitcoin Chart: Bitcoin was printing an inside bar on the daily chart just above a support level at $42,223. The crypto is trading in a short uptrend within a larger downtrend. Bitcoin will have to make a higher high above the $55,200 level for confirmation the downtrend is over.
The Dogecoin Chart: Dogecoin is trading in a steep downtrend but holding above a key support level of $0.197. The crypto’s inside bar on Saturday demonstrates consolidation. If Dogecoin loses support at its key level it could fall toward the 16-cent mark.
The Ethereum Chart: Like Bitcoin, Ethereum may be working to reverse course into an uptrend but will need to shoot up above Thursday’s high of $3182 for confirmation. Otherwise, the crypto could continue lower in its larger downtrend following Saturday’s inside bar.