Pro traders went long as Bitcoin fell to $45K, liquidating $5.9B in futures

Pro traders went long as Bitcoin fell to $45K, liquidating $5.9B in futures

In the past 48 hours, Bitcoin’s (BTC) price has dropped by $13,360 and more than $2.6 billion worth of futures contracts have been liquidated. When including altcoins, the total sum of liquidations equaled $5.9 billion.

After marking a record-high open interest at $19.5 billion on Feb. 21, the metric has stabilized at $16.5 billion. This means that half of the terminated leverage positions have been reopened.

According to the top traders’ long-to-short data and various funding rate indicators, retail traders took the largest hit.

Top traders bought the dip

The top traders’ long-to-short indicator is calculated by using clients’ consolidated positions, including spot, margin, perpetual and futures contracts. Unlike the futures premium or options skew indicators, this metric gathers a broader view of professional traders’ effective net position.

Top traders long-to-short ratio. Source: Bybt.com

Despite the discrepancies between crypto exchange methodologies, analyzing changes over time provides valuable insights.

Top traders at Huobi held a 0.81 long-to-short ratio on Feb. 20, favoring shorts by 19%. By adding net long positions over the following 48 hours, the indicator peaked at 0.95, indicating that buy-side activity prevailed.

OKEx top traders were aggressive net buyers over the past three days. Starting from a 0.86 indicator favoring shorts by 14%, they’ve managed to revert it to a 69% net buyer position.

Lastly, Binance top traders started at 1.36, favoring net longs, but were either liquidated or opened net shorts until reaching the current 1.23 level. Either way, those traders haven’t been adding positions over the past three days.

Overall, the average top traders’ long-to-short position went from 1.01 (flat) on Jan. 20 to the current 1.37 favoring net longs. Therefore, it’s clear that arbitrage desks and whales increased their longs throughout the liquidations.

The reduced funding rate shows retail investors reduced their longs

If top traders are net buyers, then retail must be holding the other end, even if that happened through leveraged long liquidations.

To keep a balanced risk exposure, derivatives exchanges charge either perpetual futures longs (buyers) or shorts (sellers) a fee every eight hours. Known as the funding rate, this indicator will turn positive when longs are the ones demanding more leverage.

On the other hand, periods of fear and heavy selling activity lead to negative funding rate turns. This time around, shorts would be the one paying up.

BTC perpetual contacts funding rate. Source: NYDIG

Since Feb. 6, the average weekly funding rate has exceeded 2.3%. That happened while Bitcoin surpassed $38,000, indicating excessively leverged retail longs. On the other hand, top traders usually opt for fixed-calendar futures in order to avoid the exorbitant funding fees during rallies.

This movement faded completely on Feb. 23 as Bitcoin’s price plunged below $50,000. After briefly flirting with a negative funding rate, it has now stabilized near 0.5% per week. The metric signals that retail traders were liquidated, hence causing the indicator to return to neutral levels.

Although $50,000 sounds like a meaningful psychological level, Bitcoin’s 67% year-to-date gains will likely continue to attract investors. The modest 3% performance from the S&P 500 and a 0.6% yield on  five-year U.S. Treasury Notes offer no match for the potential upside that can be captured from cryptocurrencies.

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.

Title: Pro traders went long as Bitcoin fell to $45K, liquidating $5.9B in futures
Sourced From: cointelegraph.com/news/pro-traders-went-long-as-bitcoin-fell-to-45k-liquidating-5-9b-in-futures
Published Date: Tue, 23 Feb 2021 18:51:42 +0000

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Pro traders went long as Bitcoin fell to $45K, liquidating $5.9B in futures

$5.64 billion liquidated in 24 hours as Bitcoin extends losses — Is a relief rally near?

$5.64 billion liquidated in 24 hours as Bitcoin extends losses — Is a relief rally near?

The price of Bitcoin (BTC) plummeted by more than 17% in the last 24 hours as the futures market saw mass liquidations across the board.

Liquidations occur when leveraged futures positions fall to a certain threshold. For example, a position using 10x leverage would get liquidated or turn worthless if the price of BTC drops by 5%.

What triggered the mass Bitcoin liquidation fest?

If the Bitcoin futures market is highly overleveraged and overcrowded, a minor price movement can trigger mass liquidations.

According to analysts at Santiment, a data analytics firm, an address was responsible for the second-largest Bitcoin transaction of the year, as Cointelegraph reported.

More than 2,700 BTC were transferred right before the drop, which were bigger than the 2,000 BTC inflow seen before the March 2020 crash when Bitcoin dropped below $4,000. The analysts said:

“As we noted yesterday, there was an 11x exchange inflow spike that initiated #Bitcoin’s price correction from its $58.3k #ATH. Further data combing revealed that an address was responsible for the 2nd largest $BTC transaction of the year, an import of 2,700 tokens to the wallet before a quick sell-off. This same address also made a 2,000 $BTC import last March right as the Black Thursday correction took place. In total, it’s made 73 transactions in its one-year existence, for a total of 91,935 $BTC imported, with all tokens moving away within minutes after arrival.”

Total cryptocurrency futures liquidations. Source: Bybt

It is a possibility that a major sell-off in the spot market triggered the futures market to see intense selling pressure from many long positions getting liquidated.

When Bitcoin initially began to correct on Feb. 22, the futures funding rate of the dominant cryptocurrency was hovering at around 0.15% even as it continued to drop.

This trend showed two things: overleveraged buyers were aggressively buying each dip and the market remained overheated even as the pullback happened.

As a result, new buyers during the short-term downtrend were continuously liquidated, igniting a brutal cycle of cascading liquidations.

However, a pseudonymous trader known as “Byzantine General” described it as a “coordinated shakeout,” and said it is a healthy trend.

Bitcoin price chart with orderbook suite. Source: Byzantine General

If Bitcoin dropped on a so-called “black swan” news or some abnormality, it would be a cause for concern. But, the trader pinpointed the presence of relatively large buy orders to show that buyers are waiting to step in to buy the dip. He said:

“I’m glad I’m seeing signs of this being a coordinated shakeout because that implies that BTC is still bullish and big players just want their bids filled. If it wasn’t premeditated then it would be a lot more scary.”

In the near term, it is critical that Bitcoin defends the $45,000 support area to ensure that the short-term cycle does not enter the “bear zone.” Below it, the probability of a deeper and prolonged correction rapidly increases.

Title: $5.64 billion liquidated in 24 hours as Bitcoin extends losses — Is a relief rally near?
Sourced From: cointelegraph.com/news/5-64-billion-liquidated-in-24-hours-as-bitcoin-extends-losses-is-a-relief-rally-near
Published Date: Tue, 23 Feb 2021 11:38:18 +0000

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$5.64 billion liquidated in 24 hours as Bitcoin extends losses — Is a relief rally near?

Whale who sold Bitcoin before 2020 crash cashed out $156M before this week’s 20% dip

Whale who sold Bitcoin before 2020 crash cashed out $156M before this week’s 20% dip

Bitcoin (BTC) lost 20% in a day partly thanks to the actions of a single whale, new research suggests. 

Data from on-chain analytics firm Santiment on Feb. 23 showed that BTC/USD dipped to $47,400 after Bitcoin’s second-largest transaction of 2021 took place.

Ghost of Bitcoin sell-offs past returns

The transaction, 2,700 BTC worth $156.6 million at $58,000 per token, resulted in a sale which piled pressure on the market, this snowballing into the largest one-hour candle in Bitcoin’s history.

“As we noted yesterday, there was an 11x exchange inflow spike that initiated #Bitcoin’s price correction from its $58.3k #ATH,” Santiment wrote in accompanying comments on Twitter.

“Further data combing revealed that an address was responsible for the 2nd largest $BTC transaction of the year, an import of 2,700 tokens to the wallet before a quick sell-off.”

Import chart for suspect whale sell-off address. Source: Santiment/ Twitter

The findings shed light on what exactly was happening as volatility took over for Bitcoin, which managed to recover to $54,000 before trading below $50,000 once more at the time of writing.

Some believe that the market was overextended, with naysayers in particular claiming that a bubble-like process had long been underway. Others argued that it was simply “business as usual” for crypto trading, but as Cointelegraph reported, concerns had mounted about unusual inflows to exchanges.

Santiment noted that the same address had also sold immediately before the cross-asset price crash in March 2020. At the time, Bitcoin lost almost 60% of its value and hit $3,600.

“This same address also made a 2,000 $BTC import last March right as the Black Thursday correction took place,” it revealed.

“In total, it’s made 73 transactions in its one-year existence, for a total of 91,935 $BTC imported, with all tokens moving away within minutes after arrival.”

Whales in the spotlight

Suspicions had long been eyeing whales, who had profited from small wallets selling during previous price dips throughout Bitcoin’s recent bull run. As Cointelegraph reported, the number of whale-sized wallets had been growing, while smallholders had been decreasing.

Bitcoin whale addresses vs. BTC/USD chart. Source: Dovey Wan/ Twitter

“The most interesting side by side tells you how Bitcoin investor profile progress – ‘whales’ diminished as price elevated in the last cycle; new group of whales just keep popping up this time, while shrimps are the weak hands who sold too early,” Primitive founding partner Dovey Wan tweeted last week alongside a chart comparing the 2017 and 2021 bull runs.

“THE GREAT WEALTH TRANSFER,” she added. 

Some responses to the research meanwhile noted that the wallet in question had been responsible for a fraction of total trading volume and that its influence should therefore be limited.

“We don’t believe that one address alone triggers the price retracement of the largest crypto asset in the world, so we certainly wouldn’t want you to believe it either,” Santiment replied.

“Was this address activity a contributing factor though? Yes.”Title: Whale who sold Bitcoin before 2020 crash cashed out $156M before this week’s 20% dip
Sourced From: cointelegraph.com/news/whale-who-sold-bitcoin-before-2020-crash-cashed-out-156m-before-this-week-s-20-dip
Published Date: Tue, 23 Feb 2021 08:46:00 +0000

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Whale who sold Bitcoin before 2020 crash cashed out $156M before this week’s 20% dip

Here’s how pro traders use options to profit from Bitcoin price corrections

Here’s how pro traders use options to profit from Bitcoin price corrections

Bitcoin seems to be struggling at the $58,000 level, which is leading some traders to fear a more significant correction could take place.

While Bitcoin’s (BTC) 2021 performance has been incredibly strong, its current 696% gain and comments from United States Treasury Secretary Janet Yellen suggesting that cryptocurrencies are used to finance terrorism may be enough to have investors feeling a bit cautious.

Reducing open position sizes is usually the method most investors use to reduce exposure, but another way to manage risk is to use BTC options contracts to provide protection. Buying a put (sell) option is the easiest way, but it is quite costly considering the current high volatility scenario.

For example, a March 26 put option with a $56,000 strike trades at $5,300, and its holder would only profit if BTC trades below $50,700 in 32 days. That would be 12% below the current $57,500 price. This protection cost depends on the number of days until expiry and the implied volatility, or a traders’ expectation of substantial price swings.

By using call (buy) options and puts (sell), a trader can create strategies to reduce this cost. There are infinite possibilities, but for now, let’s focus on a low-cost bearish one.

Protective puts can generate a profit on the downside

This bearish strategy consists of buying a protective put in order to profit from the downside while simultaneously selling call options at higher strikes. These additional trades will cover the put option’s cost but will result in losses if BTC surpasses a certain threshold.

Profit / Loss estimate. Source: Deribit Position Builder

The above trade consists of buying 1 BTC contract of the March 26 put option with a $56,000 strike, while selling 1 BTC contract of the March 26 call option with a $64,000 strike.

As the estimate above shows, the end result between $56,000 and $64,000 is neutral. The trader would not incur any losses, but would also not profit from the strategy. On the other hand, if BTC drops to $46,000, or by more than 20% from $57,500, the contract holder would profit by $10,200.

In order for the trader to incur a $5,000 loss, BTC would have to reach $69,000 on March 26, which is equivalent to a 20% gain from the current price. Therefore, even though this is a bearish strategy, traders would only incur losses above $64,000, or 11% above the current price level.

This strategy provides a good risk-reward for those seeking downside protection. Moreover, there is zero upfront involved for those trades, except from the margin or collateral deposit requirements.

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.

Title: Here’s how pro traders use options to profit from Bitcoin price corrections
Sourced From: cointelegraph.com/news/here-s-how-pro-traders-use-options-to-profit-from-bitcoin-price-corrections
Published Date: Tue, 23 Feb 2021 00:30:00 +0000

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Here’s how pro traders use options to profit from Bitcoin price corrections

3 reasons why Fantom (FTM) price continues to rally to new all-time highs

3 reasons why Fantom (FTM) price continues to rally to new all-time highs

Interoperability has emerged as the hot topic in February as platforms like Binance Smart Chain and Polkadot work on building Ethereum network bridges that allow users to escape high transaction costs and network congestion.

Fantom (FTM) is the latest project to receive a boost by offering cross-chain functionality with Ethereum, and data from Cointelegraph Markets and TradingView shows a 1,570% increase in FTM price from $0.025 on Jan. 23 to a new high of $0.43 on Feb. 21.

FTM/USDT 4-hour chart. Source: TradingView

Three fundamental reasons for Fantom’s current rally are the release of a cross-chain bridge between Ethereum and Fantom, the roll-out of on-chain governance features and the ability to stake tokens on the network while still accessing their value for use in the decentralized finance ecosystem.

Yearn.finance helps facilitate a cross-chain bridge to Ethereum

On Feb. 21, Fantom, with the help of Andre Cronje of Yearn.finance, announced the development of a cross-chain bridge with Ethereum that allows users to transfer ERC-20 tokens to Fantom to “enjoy fast and cheap transactions.”

According to the team, transactions on Fantom “are confirmed in 1-2 seconds” and “cost a fraction of a cent.” The team also promised that cross-chain functionality with other chains will be soon to follow.

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for FTM on Feb. 21, prior to the recent price rise.

The VORTECS™ score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ score (green) vs. FTM price. Source: Cointelegraph Markets Pro

As seen on the chart above, the VORTECS™ score for FTM reached a high of 74 early on Feb. 21, shortly before the price broke out to a new all-time high.

On-chain governance boosts community involvement

Another one of the popular themes of the current bull market is the ability of tokenholders to participate in the development of the ecosystem via a governance mechanism.

On Jan. 12, the Fantom Foundation unveiled the release of on-chain governance for the Fantom network, becoming one of the first chains to support such functioning for a fully decentralized blockchain.

Through the governance mechanism, each FTM token equals one vote, and any tokenholder can submit a proposal on ways to improve the ecosystem, as well as vote on any pending proposal.

Proposal submissions cost 100 FTM, which is burned during the operation, and voting costs a fraction of 1 FTM.

The Fantom voting system differs from other governance platforms, as it offers a variety of proposal templates and the ability to express the degree of agreement with the proposal as opposed to casting a simple “yes” or “no” vote.

Fantom plans to integrate staking and DeFi features

A third motivating factor behind the recent price rise of FTM is the introduction of liquid staking, or the ability to stake tokens on the network and simultaneously access the value of the token for use in DeFi.

On most proof-of-stake networks, tokenholders have to choose between staking their tokens to secure the network and earn rewards or give up those rewards to access the value of the token as collateral or for trading purposes.

FTM holders are able to stake their tokens on the network and mint an equivalent amount of sFTM, which can then be used as collateral on the Fantom Finance DeFi platform.

Providing tokenholders with an extra way to earn a yield has proved to be an attractive incentive, and after FTM was listed on SushiSwap and 1inch on Jan. 25, its price exploded from $0.05 to $0.26 over the next three days.

Since then, FTM has been added to Coinbase Custody and the Ledger hardware wallet, as well as being chosen by the Ministry of Digital Transformation of Ukraine as the platform for the exchange of intellectual property.

Each of these developments supports the strong breakout in FTM price, and the upcoming public release of its Ethereum cross-chain bridge has placed Fantom in a good position to receive a new level of DeFi engagement. Furthermore, the prospect of transaction fees that cost less than $0.01 may prove to be an enticing incentive for crypto traders and could lead to liquidity migration. 

com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Title: 3 reasons why Fantom (FTM) price continues to rally to new all-time highs
Sourced From: cointelegraph.com/news/3-reasons-why-fantom-ftm-price-continues-to-rally-to-new-all-time-highs
Published Date: Mon, 22 Feb 2021 17:05:00 +0000

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3 reasons why Fantom (FTM) price continues to rally to new all-time highs

Fuel for a broader Bitcoin rally? BTC dip fills futures gap, liquidating $1 billion

Fuel for a broader Bitcoin rally? BTC dip fills futures gap, liquidating $1 billion

An important  Chicago Mercantile Exchange (CME) Bitcoin (BTC) futures gap closed as BTC/USD suddenly dropped below $54,000 on Feb. 22. 

A CME gap forms when the price of Bitcoin moves either up or down after the CME closes during the weekend or holidays in the U.S. 

Unlike most cryptocurrency exchanges, since the CME Bitcoin futures exchange is not open at all times, a gap forms between CME and many Bitcoin trading platforms.

BTC/USDT 4-hour price chart (Binance). Source: TradingView.com

Why is the CME Bitcoin gap significant?

The CME gap is sometimes considered an important gap to fill for the Bitcoin rally to continue in the near term.

For instance, the latest gap formed when the price of Bitcoin exceeded $58,000 across major cryptocurrency exchanges, while CME’s Bitcoin futures market closed for two days.

As such, a gap at $55,504 emerged, which closed as the price of Bitcoin fell steeply after the new weekly candle opened.

#Bitcoin CME gap closed finally. https://t.co/JygwzJwClk pic.twitter.com/XYkPgKuBjp

— Fomocap trades (@Workedia) February 22, 2021

Bitcoin has a tendency to sharply correct in a short period after a new weekly candle opens. This flushes out overleveraged longs and brings some balance into the market.

Prior to the weekly candle open, the funding rate of the Bitcoin futures market ranged between 0.1% to 0.15%. This is 10 to 15-fold higher than the default 0.01% funding rate.

Although the funding rate of Bitcoin has remained relatively high throughout the bull cycle, a 0.15% funding rate indicates that the market is extremely overcrowded.

The combination of a high Bitcoin futures funding rate, the presence of a CME gap, and whales depositing to major U.S. exchanges likely fueled the drop.

Large deposits spotted on Gemini

Prior to the pullback, CryptoQuant found that large BTC deposits were transferred to Gemini, one of the leading U.S. cryptocurrency exchanges.

Before the dip, there were significant $BTC inflows into all exchanges, mostly Gemini.

Chart https://t.co/6gPk3Qbg6j pic.twitter.com/j1wDNtqNak

— CryptoQuant.com (@cryptoquant_com) February 22, 2021

When whales deposit BTC into exchanges, it typically signals an intent to sell. Hence, it is likely that some whales took profit on their positions, causing the market to dip sharply in a short period.

However, whales selling large amounts of Bitcoin can cause a bigger correction than usual because it leads to cascading liquidations in the futures market.

Many overleveraged longs can get liquidated consecutively, amplifying the effect of the whale-induced sell-off. Data shows that over $1 billion worth of futures contracts were liquidated in the last 24 hours.

After the drop, traders are anticipating a gradual recovery. Scott Melker, a cryptocurrency trader and technical analyst, said that recent history indicates dips do not last long. He wrote:

“I have no idea what happens here, but recent history shows that dips have not lasted long. Would love to see another slow float back up after this bit of selling. Of course we could drop, but each move like this of late has been a buying opportunity.”Title: Fuel for a broader Bitcoin rally? BTC dip fills futures gap, liquidating $1 billion
Sourced From: cointelegraph.com/news/fuel-for-a-broader-bitcoin-rally-btc-dip-fills-futures-gap-liquidating-1-billion
Published Date: Mon, 22 Feb 2021 12:03:03 +0000

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Fuel for a broader Bitcoin rally? BTC dip fills futures gap, liquidating $1 billion

DEX goals diverge as SushiSwap (SUSHI) and Uniswap (UNI) rally to new highs

DEX goals diverge as SushiSwap (SUSHI) and Uniswap (UNI) rally to new highs

Uniswap and SushiSwap have emerged as two of the top decentralized exchanges (DEXs) that are leading the current DeFi bull run higher.

Despite a controversial start for SushiSwap, the last few months have seen it catching up to Uniswap in terms of activity on the platform, total value locked, and the price of its SUSHI governance token.

A recent report from Delphi Digital took a closer look at the two projects and broke down the fundamental differences in the way that each has diverged in their development since SushiSwap’s vampire attack on Uniswap.

SUSHI vs. UNI price. Source: TheTIE

SushiSwap originally emerged as a fork of Uniswap v2 with the inclusion of the SUSHI governance token which was distributed to participants of the community.

At the time, Uniswap had yet to launch the UNI token which would subsequently be airdropped to users who had interacted with the protocol either by trading or providing liquidity.

While UNI had likely been planned for release at some point, many saw the surprise airdrop as being a bid to stop a potential vampire attack that would drain the liquidity from Uniswap to SushiSwap.

After a bumpy start which saw SushiSwap co-creator Chef Nomi dump all of his SUSHI tokens on the market for $14 million worth of Ether (ETH), only to later return those funds to the treasury, SushiSwap co-founder ‘0xMaki’ took over as the lead on the project and helped it to correct course and become a viable contender among DeFi platforms.

Total value locked on Sushiswap. Source: Defi Llama

When it comes to comparing the original token distribution, 65% of the original UNI supply was distributed to the community through liquidity mining and a governance-controlled treasury versus 80% of all SUSHI tokens.

In this regard, the SushiSwap platform has emerged as a more community-controlled project that is self-funded with 9% of all SUSHI emitted from the system awarded to the treasury. In contrast, Uniswap has received some VC backing with a total of $12 million being raised from various sources to help fund future development.

SushiSwap is more decentralized than Uniswap

Differences in the path of development began soon after the fork and led to two distinct platforms that offered a different experience. The excitement continues to build for the release of Uniswap v3, although only a handful of insiders know exactly what the new version will entail.

While users and token holders trust the lead developers which have created an incredible interface thus far, many in the cryptocurrency space prefer a project with more transparency and community involvement.

SushiSwap keeps more to the community ethos of cryptocurrency in this way, with a core team of developers that is more transparent about what is coming and where the project is headed in the future.

SushiSwap also has established an effective governance system that allows community members to have a say in important decisions. The governance system for Uniswap is less conducive to community involvement, which could be the result of the rushed release of the UNI token and a desire to create a solid foundation before integrating community governance.

Divergence in value proposition and community involvement

Over the past few months, the Uniswap team has been focused on building out v3. As Delphi Digital pointed out, Uniswap’s first-mover advantage has provided the platform with a bevy of integrations as the platform was sought out by projects across the sector for the liquidity it provided.

SushiSwap on the other hand has been busy establishing connections with other burgeoning DeFi platforms, most notably the yEarn ecosystem which includes yEarn, Cream, Pickle, Cover, and Alpha. This will help increase the use of SushiSwap’s liquidity offerings and help make the platform more resilient to upcoming challenges.

SushiSwap vs. Uniswap pool liquidity. Source: Dune Analytics

More recently, SushiSwap has begun to incentivize liquidity for longer tail assets as it looks to establish itself as a place to get access to projects with long term viability. In contrast, Uniswap has been a way for new projects to get a head start on liquidity and community exposure.

One of the most significant differences between the two platforms relates to cash flow generation.

In March of 2021, the UNI community will have the ability to divert 0.05% of all fees on the platform to the Uniswap treasury which is governed by the UNI token. The fees will accrue in the treasury and UNI token holders will be able to vote on what to do with those funds in the future.

SushiSwap has had the 0.05% fee in place since it was created in September 2020 and the governance council agreed that the money generated is used to purchase SUSHI directly and award it to stakers, providing a source of direct income.

In terms of fees generated, Uniswap clearly comes out on top for the time being. With a larger number of available trading pairs and huge liquidity pools for top coins, the Uniswap platform sees higher volumes and this translates into more cash flow for liquidity pools and UNI token holders.

Uniswap vs SushiSwap volume. Source: TheTIE

But with fees going to a treasury rather than directly to token holders, UNI has been more appealing to investors with a longer-term outlook who prefer the approach of “accumulating capital in the treasury during the early years.”

So SushiSwap offers a more community-oriented and governed system that provides direct income to token holders from fees generated on the platform while Uniswap is working on a long term plan to create a one-stop DEX that meets every traders’ needs.

First mover advantage and dominant liquidity pools have allowed Uniswap to compete with the likes of Coinbase in terms of trading volume and long-time cryptocurrency advocates appreciate this accomplishment.

Weekly DEX volume. Source: Dune Analytics

SushiSwap has risen from the ashes to create a community-driven project that those just getting into crypto can appreciate for its ability to generate immediate income.

SUSHI has also seen a recent spike in trading volume on Uniswap, showing that the fight for the title of top DEX is just getting started in these early rounds of the crypto bull cycle.

SUSHI volume on Uniswap. Source: Glassnode

The DeFi sector is just beginning to gain attention from the traditional financial sector and as the liquidity, total value locked and price of each platform’s governance token reaches new highs for both Uniswap and SushiSwap it will be interesting to watch as the two platforms continue to diverge in development.

com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Title: DEX goals diverge as SushiSwap (SUSHI) and Uniswap (UNI) rally to new highs
Sourced From: cointelegraph.com/news/dex-goals-diverge-as-sushiswap-sushi-and-uniswap-uni-rally-to-new-highs
Published Date: Mon, 22 Feb 2021 01:00:00 +0000

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DEX goals diverge as SushiSwap (SUSHI) and Uniswap (UNI) rally to new highs

Top 5 cryptocurrencies to watch this week: BTC, AAVE, ATOM, NEO, VET

Top 5 cryptocurrencies to watch this week: BTC, AAVE, ATOM, NEO, VET

The Purpose Bitcoin (BTC) exchange-traded fund debuted on the Toronto Stock Exchange on Feb. 18 and has quickly ramped up trading volumes of about $400 million worth of shares in two days. This is quite impressive, considering that the equity market in Canada is only a fraction of the size of the U.S. markets. This shows strong demand for Bitcoin and investor’s preference to take the ETF route to establish fresh positions.

Last week, Bitcoin reached another important milestone when it hit the critical $1 trillion market capitalization on Feb. 19, making it the sixth asset on the list of top market cap companies in the world. 

The involvement of institutional investors and a market cap of over $1 trillion could allay the concerns of manipulation and liquidity raised by the U.S. Securities and Exchange Commission in the previous years as it rejected Bitcoin ETF applications. 

Crypto market data daily view. Source:Coin360

In a recent interview with CNBC, Ark Invest CEO Cathie Wood said that “the probability of an ETF has gone up.” Wood said the new SEC chairman Gary Gensler, who taught a digital currency class at the Massachusetts Institute of Technology, could be more open to crypto, increasing the likelihood of an approved Bitcoin ETF.

Although Bitcoin’s fundamental factors continue to improve, the near term could experience some turbulence due to the steepening of the U.S. Treasury curve.

Let’s analyze the charts of the top-5 cryptocurrencies that indicate the possibility of the resumption of the uptrend in the short term.

BTC/USD

Bitcoin broke above the resistance line of the ascending channel on Feb. 19 and the bulls have managed to sustain the breakout. This suggests that traders continue to buy at higher levels.

BTC/USDT daily chart. Source: TradingView

The BTC/USD pair had formed a Doji candlestick pattern on Feb. 20, indicating indecision among the bulls and the bears about the next directional move. That uncertainty has resolved to the upside today and the bulls will now try to propel the price to $60,974.43.

The 20-day exponential moving average ($47,450) is sloping up and the relative strength index (RSI) is in the overbought zone, which indicates that bulls have the upper hand.

Contrary to this assumption, if the price re-enters the channel, the bears will try to pull the price down to the 20-day EMA. A break below the channel will indicate a possible change in trend and the pair may then correct to the 50-day simple moving average.

BTC/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows the pair remains in a strong uptrend and the bulls have aggressively purchased the dips to the 20-EMA. The bears will try to stall the current uptrend at the resistance line of the ascending channel.

If they succeed, the pair may again drop to the 20-EMA. A bounce off this support will suggest that the trend remains strong and the bulls are not waiting for a deeper correction to buy. The momentum could pick up if the bulls can propel and sustain the price above the channel.

On the contrary, if the bears can sink the price below the 20-EMA, it will suggest profit-booking by traders. The trend could weaken if the pair plunges below the channel.

AVE/USD

AAVE has been consolidating between $392.50 and $545 for the past few days. A consolidation after a strong uptrend is a positive sign as it suggests that traders are not rushing to the exit because they anticipate higher levels in the future.

AAVE/USDT daily chart. Source: TradingView

The 20-day EMA ($427) is flat and the RSI is just above 56, which suggests that the range-bound action may continue for a few more days.

If the buyers can push the price above $480, the AAVE/USD pair may rise to $545. A breakout and close above the $545 to $581.667 resistance zone could start the next leg of the uptrend that may reach $697.50 and then $814.397.

On the other hand, if the bears can sink and sustain the price below $392.50, it will suggest that supply exceeds demand. That could start a deeper correction to the 50-day SMA ($297).

AAVE/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows that the price has been oscillating between $500 and $392.50. If the bears sink the price below the $392.50 support, the pair could drop to $300 and then to the 61.8% Fibonacci retracement level at $267.094.

Contrary to this assumption, if the bulls can push the price above the 50-SMA, a move to $500 is possible. A break above this resistance will enhance the prospects of a move to $545 and then $581.667.

TOM/USD

Cosmos (ATOM) is currently correcting in a strong uptrend. While the pullback is five days old, the bears have not yet been able to pull the price down to the 38.2% Fibonacci retracement level at $19.007. This shows a lack of sellers at lower levels.

ATOM/USDT daily chart. Source: TradingView

A shallow correction is usually a sign of strength and it increases the possibility of a retest of the $26.55 overhead resistance. The rising moving averages and the RSI in the positive territory suggest that bulls have the upper hand.

If the bulls can thrust the price above $26.55, the next leg of the uptrend could begin. The ATOM/USD pair could then rally to $32.173. If the bulls can conquer this level, the up-move may extend to $40.

On the contrary, if the pair continues to fall, a drop to the 20-day EMA ($18.19) is possible. A strong bounce off this support could keep the uptrend intact but a break below it will suggest a deeper correction to the 61.8% retracement level at $14.347.

ATOM/USDT 4-hour chart. Source: TradingView

The 4-hour chart is currently correcting inside a descending channel. The moving averages are on the verge of a bearish crossover and the RSI is in the negative territory, indicating a minor advantage to the bears.

However, if the price rises from the support line of the descending channel, it will indicate accumulation at lower levels. On a break above the moving averages, a move to the resistance line of the channel is possible.

A breakout and close above the channel could result in a retest of $26.55. On the other hand, a break below the channel may weaken sentiment. The pair could then decline to the 50% retracement level at $16.677.

NEO/USD

NEO broke and closed above the $47.444 resistance on Feb. 19. The bears attempted to fake this breakout and trap the aggressive bulls on Feb. 20 when they pulled the price back below $47.444.

NEO/USDT daily chart. Source: TradingView

However, the bulls had other plans. They aggressively purchased the dip and have pushed the price above the psychological resistance at $50 today. This may start the next leg of the uptrend that could reach $60.373 and then $64.95.

The upsloping moving averages and the RSI in the overbought territory indicate that bulls are in control.

But if the bulls fail to sustain the price above $50, it will suggest that traders are booking profits at higher levels. A break below the 20-day EMA ($37.80) will signal a possible change in trend.

NEO/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows the formation of an ascending triangle, which has a pattern target at $58.588. Generally, the price turns down and retests the breakout level but sometimes, when the trend is strong, the price only consolidates before resuming the up-move.

The bulls are currently defending the $50 support. If the price rises from the current level and breaks above $54.191, the uptrend could resume.

This positive view will invalidate if the pair turns down from the current level and breaks below the triangle. Such a move may result in a fall to $36.30.

VET/USD

After the sharp rally from $0.026714 to $0.060774, VeChain (VET) has largely held the 38.2% support at $0.047763 on a closing basis, which shows accumulation at lower levels. The rising moving averages and the RSI in the overbought zone suggest the path of least resistance is to the upside.

VET/USDT daily chart. Source: TradingView

If the bulls can drive the price above the overhead resistance at $0.060774, the VET/USD pair could start the next leg of the up-move. The target level to watch on the upside is $0.085172 and then $0.10.

Contrary to this assumption, if the bulls fail to propel the price above the overhead resistance, the VET/USD pair may consolidate between $0.060774 and $0.0424 for a few more days. The trend will tilt in favor of the bears if they can sink and sustain the price below $0.0424.

VET/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows that both moving averages are flat and the RSI is just above the midpoint, indicating a balance between supply and demand.

However, the pair has formed an ascending triangle pattern that will complete on a breakout and close above $0.060774. This bullish setup has a pattern target of $0.079148.

On the other hand, if the price slips below the trendline of the ascending triangle, it will invalidate the pattern and open the doors for a fall to $0.042.

Title: Top 5 cryptocurrencies to watch this week: BTC, AAVE, ATOM, NEO, VET
Sourced From: cointelegraph.com/news/top-5-cryptocurrencies-to-watch-this-week-btc-aave-atom-neo-vet
Published Date: Sun, 21 Feb 2021 19:45:01 +0000

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Top 5 cryptocurrencies to watch this week: BTC, AAVE, ATOM, NEO, VET

Monster bull flag for Yearn.finance puts $200,000 YFI price in play

Monster bull flag for Yearn.finance puts $200,000 YFI price in play

Bitcoin (BTC) bears looked on in disbelief as BTC price rallied to over $57,800 on Feb. 21, sparking a major altcoin rally. It seems bull flags are being printed one after the other on coins like Polkadot and Cardano, which are playing out predictably. 

However, one coin that is not getting the limelight it deserves right now is Yearn.finance (YFI), and at present, it looks like a period of aggressive selling could be coming to an end with a potential 50% move to the upside being imminent. But first, let’s take a look at why it has been struggling recently.

Troubled waters for Yearn

YFI/USD 1-hour candle chart. Source: TradingView

Much to the dismay of investors and traders on Jan. 20, Yearn.finance retweeted a gif of Pepe the Frog dressed as a wizard, which linked to the proposal entitled “YIP-57: Funding Yearn’s Future.”

The article outlined the plans to mint 6,666 new YFI tokens for the Yearn treasury, thus increasing the YFI supply by more than 20% and in turn, a 24.45% red candle was printed on the daily chart.

After the aggressive selling eased off, the price slowly gained traction again. However, about two weeks later on Feb. 4, an $11m yDAI exploit occurred, spurring on the following tweet:

“We have noticed the v1 yDAI vault has suffered an exploit. The exploit has been mitigated. Full report to follow.”

This led to a further sell-off for YFI, printing another 15% red candle in a single day. Yet despite all this bad news, the price unexpectedly rallied 50% to a new all-time high at $52,700, three days before Bitcoin cracked the $50K barrier.

But was this unexpected? Or was it just a bull flag playing out albeit over a slightly extended period of time due to knee-jerk reaction sell-offs?

Monster bull flag on the daily

YFI/USD 1-day candle chart. Source: TradingView

Over on the daily chart, we can see that a 52% candle was printed on Jan. 7, and after the price consolidated over a period of 10 days, the price broke out of a classic bull flag structure before the bad news started circulating, causing holders to lose faith in founder Andre Cronje.

However, once the news had passed it was clear from the gradual 52% price increase that bullish investor sentiment had returned, which just so happened to be the same size as the flagpole on the somewhat failed bull flag.

The good news for YFI holders now is that the charts are now showing the exact same pattern playing out with a 50% candle, which would bring the price target up to $65,770

$200,000 in play for YFI price

YFI/BTC 1-day candle chart. Source: TradingView

In 2020, YFI was trading higher than Bitcoin, and even once you factor in the newly minted tokens, the upside is simply staggering.

Without factoring in the extra tokens, the upside to return to its previous sats value would be in excess of 450% from the current price.

However, even by deducting 20% off this level, which would represent a move to the 0.786 Fibonacci (fib) level, this still puts a potential upside target around 350%. In other words, this puts YFI at an eye-watering $200,000 per coin.

DeFi is so hot right now

UNI/USD 2-hour candle chart. Source: TradingView

Whilst the prospect of paying $200,000 per coin may seem insane, you only have to look at how well other projects in the DeFi space are performing. Uniswap, SushiSwap and PancakeSwap all managed to accomplish 10x since Christmas.

But all of these have fully rebounded beyond their previous sats value, so now is the time to look for something that hasn’t made this move yet, and right now, in my opinion, the largest most obvious one to go next is Yearn.

You only have to look at the UNI/BTC chart to see that right now. Everything about YFI screams “buy,” where even a move just to the 0.236 Fibonacci level would represent a 70% increase in price.

UNI/BTC 1-day chart. Source: TradingView

Bullish and bearish scenarios

If there’s one thing Yearn.finance has taught us, it is always to expect the unexpected when testing in production.

YFI/USD 1-hour candle chart. Source: TradingView

Right now, there’s a heavy point of control around $39,000 that price keeps revisiting and serving as support.

Should this level continue to hold, a move to the upper resistance of the current channel around $55,485 is where I would be first targeting, before the wider breakout to $65,000.

Should $39,000 fail to hold, I would be looking around $32,500 as support, something I’m not worried about unless another Andre project gets rugged.

The views and opinions expressed here are solely those of @officiallykeithand 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.

Title: Monster bull flag for Yearn.finance puts $200,000 YFI price in play
Sourced From: cointelegraph.com/news/monster-bull-flag-for-yearn-finance-puts-200-000-yfi-price-in-play
Published Date: Sun, 21 Feb 2021 14:00:00 +0000

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Monster bull flag for Yearn.finance puts $200,000 YFI price in play