Market Update – 22nd October 2020
The stimulus countdown clock is ticking with just under two weeks until the Presidential elections. The risk-off sentiment seen during this mornings sessions shows investors are growing tired of hearing that stimulus talks are “progressing”.
There have been conflicting stories coming out from both sides. Nanci Pelosi, Democratic House Speaker has stated there is still time for a deal to be struck and both sides are coming closer to an agreement. Whereas McConnell, the Republican Senate Majority leader has warned the White House not to take the deal as Pelosi is operating in bad faith, attempting to complicate Trump’s Supreme Court nomination, Amy Barrett.
It is widely understood that a stimulus package will arrive at some point, it is just a matter of when and how large. McConnell has made it known that the Republican party, who control the Senate, are not in favour of such a large package. The longer the negotiations continue, the less likely chance of a package being agreed upon prior to the US Presidential elections.
US equities are looking fragile and threatening further downside if a stimulus package is not provided soon. If a stimulus deal is struck, the EURUSD may provide an opportunity to continue its bullish momentum after facing a pullback.
EURUSD – Weekly Charts
The EURUSD’s fate hangs in the balance with the weekly charts showing an inside bar. An inside bar can indicate reversal opportunities as well as a continuation of a trend. We will need to see confirmation during this weeks closing price. A close above the weeks previous high will indicate bulls are in control.
EURUSD – 1 Hour Charts
The 1-hour charts are showing a temporary resistance zone at a key trend line. The EURUSD has been rejected from the previously broken trend line at 1.1880. Bulls will need to break above resistance to convince the market of a continuation of further upside.
Immediate support can be found at 1.1835. A breach of the key support zone may indicate the market is not convinced a stimulus deal will be reached prior to the elections.
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Price analysis 10/21: BTC, ETH, XRP, BCH, BNB, LINK, DOT, LTC, ADA, BSV
The crypto markets are cheering PayPal’s decision to allow its customers to use cryptocurrencies to shop from its vast merchant network. PayPal also revealed that U.S. account holders will be able to buy, sell, and hold cryptocurrencies in the PayPal app.
The company plans to extend this service to a few other countries in the first half of 2021. PayPal’s decision has significantly increased the reach of cryptocurrencies. Now many of the company’s 346 million active users will have the options to engage with cryptocurrencies and become investors if they choose.
However, a mass influx of investors into cryptocurrencies is likely to take more time. Ultimately, this move by PayPal proves that companies cannot ignore the rise of digital assets anymore.
Although the news is bullish, a vertical rally may not materialize immediately. After the initial buying frenzy dies down, the extent of any future correction will confirm whether a new roaring bull market has begun or if institutional investors used this news to lighten up their positions in order to buy at lower levels.
Let’s analyze the charts of the top-10 cryptocurrencies and spot the critical levels to watch out for.
Bitcoin (BTC) soared above the resistance line of the ascending channel on Oct. 20. That was followed by a sharp up-move today when the bulls propelled the price above the stiff overhead resistance at $12,460.
A new 52-week high is generally a bullish sign. The breakout of the ascending channel gives the BTC/USD pair a target objective of $12,975. If this level is crossed, the rally may extend to $14,000.
The current up-move has pushed the relative strength index to 80. Previous instances show that the risk of a correction increases when the RSI rises above 80.
The first sign of weakness will be a break and close (UTC time) below the previous resistance turned support at $12,000.
Conversely, if the bulls can arrest the next correction at $12,000, it will signal strength and increase the possibility of a resumption of the up-move.
Ether (ETH) has held above the 20-day exponential moving average ($370) for the past few days. The failure of the bears to break this support has attracted buying from the aggressive bulls who are trying to sustain the price above the overhead resistance at $395.
If they succeed, it will complete an ascending triangle pattern that has a target objective of $478. The gradually upsloping 20-day EMA and the RSI above 61 suggest a marginal advantage to the bulls.
However, the bears are unlikely to throw in the towel so easily. They will attempt to defend the overhead resistance at $395. If the ETH/USD pair turns down from the current levels and breaks below the uptrend line, it will signal weakness.
XRP is currently range-bound between $0.26 and $0.2295. After failing to sustain above the moving averages for the past two days, the altcoin has made a decisive move higher today.
If the bulls can sustain the momentum and push the price above $0.26, the XRP/USD pair will complete an inverse head and shoulders pattern. This setup has a target objective of $0.30.
Contrary to this assumption, if the bulls fail to push the price above $0.26, the bears will again try to sink the price below the moving averages. If they succeed, the pair may extend its stay inside the range for a few more days.
Bitcoin Cash (BCH) broke down and closed (UTC time) below the critical support at $242 on Oct. 20 but the bears could not capitalize on this weakness.
The BCH/USD pair has surged today, which shows strong buying by the bulls and short covering by the aggressive bears who may have opened short positions hoping for a fall to $200.
If the bulls can sustain the momentum and push the price above $266.46, the pair could rally to $280 and then to $300. The bounce in the RSI from 50 shows strength.
This positive view will be invalidated if the bears sell the current rally and sink the pair below the $237.69.
Binance Coin (BNB) broke and closed (UTC time) below the $29.5646 support and the 20-day EMA ($29) on Oct. 21. However, the bears could not capitalize on this advantage and intensify the selling.
The bulls are currently attempting to push the price back above the downtrend line. If the BNB/USD pair closes (UTC time) above the downtrend line, a rally to $31.9798 and then to $33.3888 is possible.
Conversely, if the price turns down from the current levels, the bears will once again attempt to sink the pair below the 20-day EMA. If that happens, the pair could decline to the 50-day simple moving average ($27).
Chainlink (LINK) turned down from the overhead resistance at $11.199 on Oct. 19 and plunged below the moving averages on Oct. 20.
However, the bulls are not willing to surrender without a fight. They are currently attempting to push the price above the $11.199–$11.8029 overhead resistance zone.
If they succeed and the LINK/USD pair closes (UTC time) above the resistance zone, it will complete an ascending triangle pattern that has a target objective of $15.
On the contrary, if the pair once again turns down from the overhead resistance, the bears will try to sink the price below the uptrend line. If that happens, a decline to $8.3817 is possible.
The bulls are struggling to push Polkadot (DOT) above the 20-day EMA ($4.14) and the bears are finding it difficult to sink the price below $3.80. This has kept the altcoin stuck inside a tight range.
Usually, a squeeze is followed by expansion. If the bulls can push the price above the 20-day EMA, the DOT/USD pair could move up to $4.6112 and that could be followed by a rally to $5.5899.
The 20-day EMA has flattened out and the RSI has risen sharply to the midpoint. This suggests that the selling pressure has reduced.
However, if the price once again turns down from the overhead resistance and slips below $3.80, a retest of the $3.5321 is possible.
Litecoin (LTC) price soared today and has reached the critical $51–$52.36 overhead resistance zone. If the altcoin can close (UTC time) above this zone, it will complete an inverse head and shoulders pattern.
This bullish reversal pattern has a target objective of $61. The moving averages have completed a bullish crossover and the RSI has risen above 63, which suggests an advantage to the bulls.
However, the bears will pose a stiff challenge in the resistance zone. If the pullback from the current level is shallow, it will suggest that traders are not booking profits at the resistance and this will increase the possibility of the start of a new uptrend.
On the contrary, if the price turns down from the current levels and the bulls fail to arrest the decline above $50, the LTC/USD pair may again drop down to the moving averages.
The bulls have once again purchased the dip to the support line of the rising wedge pattern. They will now try to push Cardano (ADA) to the resistance line of the wedge.
However, it is unlikely to be an easy task because the flat 20-day EMA ($0.10) and the RSI just above the midpoint suggest a balance between supply and demand. The bears will try to stall the recovery at the downtrend line.
If the price turns down from the overhead resistance, the bears will make one more attempt to drag the ADA/USD pair below the wedge.
On the other hand, if the bulls can push the price above the downtrend line, a move to the resistance line of the wedge is possible. A breakout of the wedge could start a new uptrend.
Bitcoin SV (BSV) largely remains range-bound between $180.63 and $146.20. The bulls are currently attempting to sustain the price above the moving averages. If they can do that the altcoin could move up to the downtrend line and then to $180.63.
On the other hand, if the price turns down from the downtrend line, the bears will try to sink the BSV/USD pair to $146.20.
Currently, the flattish moving averages and the RSI close to the midpoint suggest a balance between supply and demand.
The next trending move could start after the bulls push the price above $180.63 or the bears break the support at $146.20. Until then, volatile range-bound action is likely to continue.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
PayPal Launches New Service Enabling Users to Buy, Hold and Sell Cryptocurrency
Will enable cryptocurrency as a funding source for digital commerce at its 26 million merchants
Receives conditional Bitlicense from New York State Department of Financial Services
SAN JOSE, Calif., Oct. 21, 2020 /PRNewswire/ — The migration toward digital payments and digital representations of value continues to accelerate, driven by the COVID-19 pandemic and the increased interest in digital currencies from central banks and consumers. PayPal Holdings, Inc. (NASDAQ: PYPL) today announced the launch of a new service enabling its customers to buy, hold and sell cryptocurrency directly from their PayPal account, and signaled its plans to significantly increase cryptocurrency’s utility by making it available as a funding source for purchases at its 26 million merchants worldwide.
Mainstream adoption of cryptocurrencies has traditionally been hindered by their limited utility as an instrument of exchange due to volatility, cost and speed to transact. However, the promise of advanced technological platforms offers the possibility of mainstreaming digital currencies. According to a survey by the Bank for International Settlements, one in 10 central banks – representing approximately one-fifth of the world’s population – expect to issue their own digital currencies within the next three years.
“The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly,” said Dan Schulman, president and CEO, PayPal. “Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange. We are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.”
Building Understanding and Adoption of Cryptocurrency
To increase consumer understanding and adoption of cryptocurrency, the company is introducing the ability to buy, hold and sell select cryptocurrencies, initially featuring Bitcoin, Ethereum, Bitcoin Cash and Litecoin, directly within the PayPal digital wallet. The service will be available to PayPal accountholders in the U.S. in the coming weeks. The company plans to expand the features to Venmo and select international markets in the first half of 2021. The service is enabled in the U.S. through a partnership with Paxos Trust Company, a regulated provider of cryptocurrency products and services.
PayPal has also been granted a first-of-its-kind conditional Bitlicense by the New York State Department of Financial Services (NYDFS).
“NYDFS’ approval today follows our June 2020 announcement for a new framework for a conditional Bitlicense to encourage, promote, and assist interested institutions to have a well-regulated way to access the New York virtual currency marketplace in a way that is both timely and protective of New York consumers, through partnerships with New York authorized virtual currency firms,” said Linda A. Lacewell, superintendent, NYDFS. “NYDFS will continue to encourage and support financial service providers to operate, grow, remain and expand in New York and work with innovators to enable them to germinate and test their ideas, for a dynamic and forward looking financial services sector, especially as we work to build New York back better in the midst of this pandemic.”
As part of this offering, PayPal will provide accountholders with educational content to help them understand the cryptocurrency ecosystem, the risks and opportunities related to investing in cryptocurrency, and information on blockchain technology. There are no service fees when buying or selling cryptocurrency through December 31, 2020, and there are no fees for holding cryptocurrency in a PayPal account.
Increasing the Utility of Cryptocurrency in Digital Commerce
Beginning in early 2021, PayPal customers will be able to use their cryptocurrency holdings as a funding source to pay at PayPal’s 26 million merchants around the globe. Consumers will be able to instantly convert their selected cryptocurrency balance to fiat currency, with certainty of value and no incremental fees. PayPal merchants will have no additional integrations or fees, as all transactions will be settled with fiat currency at their current PayPal rates. In effect, cryptocurrency simply becomes another funding source inside the PayPal digital wallet, adding enhanced utility to cryptocurrency holders, while addressing previous concerns surrounding volatility, cost and speed of cryptocurrency-based transactions.
Exploring and Investing in the Next Generation of Financial Services Infrastructure
In addition to providing these significant cryptocurrency services, PayPal has been exploring the potential of digital currencies through partnerships with licensed and regulated cryptocurrency platforms and with central banks around the world. For the past five years, PayPal has increased its focus and resources on exploring the next generation of digital financial services infrastructure and enhancements to digital commerce through an internal blockchain-focused research team. In 2019, PayPal Ventures, the company’s venture capital arm, invested in TRM Labs, a company focused on helping financial institutions prevent cryptocurrency fraud and financial crime, and Cambridge Blockchain, a blockchain-based identity management and compliance software company. PayPal will continue exploring the potential of distributed ledger technologies to improve financial services and assure they are faster, more secure and less expensive. The company intends to work hand-in-hand with regulators, governments and central banks in this quest.
To learn more and join the waitlist for PayPal’s cryptocurrency services, click here.
Forward-looking statements involve risks and uncertainties which may cause actual results to differ materially from the statements made. More information about these and other factors can be found in PayPal Holdings, Inc.’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the Securities and Exchange Commission (the “SEC”), and its future filings with the SEC.
The forward-looking statements contained in this announcement speak only as of the date hereof. PayPal expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
SOURCE PayPal Holdings, Inc.