STEEM/BTC Technical Analysis 6-27-2017 -- Multi-headed Infrastrcutural Attack ?
It's been a tumultuous week in the cryptocurrency market. Ethereum has been getting shellacked, Bitcoin is breaking down, STEEM plunged below $1.50 at one point and the arbitrage between STEEM and SBD's widened to nearly $0.50US yesterday.
This is a classic example of markets out-running their trading infrastructure. Numerous outages over at Coinbase, the STEEM blockchain having to be re-indexed, etc. Was all of this the result of a bad ICO in Ethereum last week or is it something bigger, darker.
We've had a big breakdown from the 0.75mBTC level that was strong support for the past two weeks during all of this. That level is now acting as strong resistance for any bounces in the ratio. I wouldn't expect that level to be broken in the near-term. In other words, we've entered a bear market correction in the STEEM/BTC market.
That's the bad news. The good news is that we have a temporary bottom that could become a significant one in the future. The drop below 0.68mBTC support was met with YUGE buying and the subsequent pull-back didn't approach that previous low around 0.61mBTC. In fact, we got another spike low on strong volume (two black volume bars) and a move back above 0.7mBTC.
Three-month Chart
The market clearly sees 0.65 to 0.7mBTC as an important level, maybe even a floor. But, things are still dicey. The big volume bar that accompanied the spike low from earlier may be enough to arrest the selling. We will, however, need to see a break of a previous high soon or this is simply the beginning of a much deeper correction that could take the STEEM/BTC price back towards 0.40mBTC. It will depend on the volume and closing price of this current bar.
Nice post and analysis. I think unclear situations will most likely resolve them self in an unfashioned move towards the longer trend. So for me every shake down in steem is a buying opportunity.
I agree. It certainly looks that way. The markets also look to be stabilizing here temporarily. So, we'll see if there's further weakness or not.
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Spot on.
Like you said, we can't be too sure of the correction that's taking place right now. More likely than not, the market movers will keep pulling the smaller ones. Although, another side to this story is easily by plain side by side comparison. While tens of billions were pulled out of the total cryptocurrency market cap, Steem by comparison, practically "chilled out" for the most part. It tells us a lot about the different market motivations.
Based on a post I've seen (here on Steemit), it looks like we are growing at a compounded monthly rate of somewhere around 30%, and that spreads out the volume quite evenly. The deeper our market gets, the harder it is to move the prices to levels like the Ether correction and Zcash correction.
So, in my opinion Steem's prices aren't going anywhere anytime soon.
Yes, the expansion of STEEM's market is having a big effect on how well prices are holding up. Between that and some whale power downs thanks to HF 19, we'll be under pressure for the next couple of days.
In fact, there's a big lot of STEEM likely to hit the market on the 29th and then after that things should settle down.
https://steemdata.com/charts
Yeah~ Interesting current bar! :D