There have been better days and worse days for Bitcoin, Ethereum, Ripple, Litecoin and other cryptocurrencies.
The better days were back in November and December when a “virtuous” rotation helped spread the rally from Bitcoin to other cryptocurrencies. This means that funds cashed out from one currency were invested in other currencies.
That’s a bullish "technical" sign for cryptocurrencies, as it keeps the momentum for the sector alive.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment. Disclosure: I don't own any cryptocoins or tokens.]
The worse days were early this week when the sell-off in major cryptocurrencies spread across the entire sector. This means that money cashed out from one cryptocurrency didn’t flow to other cryptocurrencies, but moved to cash or to other investments.
And that’s a bearish sign for cryptocurrencies, as it undermines the momentum for the sector.
Apparently, momentum is changing very fast in cryptocurrencies, much faster than in other asset classes.
That’s why technical analysis alone may not be a reliable indicator for trying to guess the direction of the cryptocurrency markets.
What about fundamental analysis?
Original article and pictures take arabhardware.net site
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