The Great Crypto Crash

The Great Crypto Sell

Bitcoin and many other cryptocurrencies experienced a ‘meltdown’ event, similar to what we have seen at the 2008 financial crisis. The hysterical selling began when Elon Musk announced Tesla will no longer accept Bitcoin. Some accused Elon Musk of market manipulation, which sparked off the selling.

The main news however came from China. The Chinese authorities announced regulations will be placed on bitcoin mining. As of 2020, 65% of bitcoin mining is from China. A crackdown on bitcoin mining may have severe repercussions on BTC, which may then spill over to other cryptocurrencies.

It is still early to label the current selling as the infamous ‘Tulip Mania’ where the Tulips market collapsed in the 17th Century. Many may see the current selling as a buying opportunity. After all, technical indicators may point to oversold territories.

Buying dips is often based on some logic. Buying crypto simply due to some selling as the price is now ‘cheap’ may not be a wise investment or trading strategy.

One method is via technical analysis that is appropriate for cryptocurrencies. ‘Copy-pasting’ strategies from stocks or Forex into crypto may not work as expected. Adjustments must be constantly made to accommodate¬† the current market conditions.

Crypto Trading Bots

Crypto trading bots are likely to benefit from some popularity following the heavy selling. Investors or traders that were affected by the declines may turn into alternatives such as robots or algorithmic trading. The biggest challenge in paying for trading robots are scammers.

In forex trading, the average lifespan of a trading bot used to 90 days. After 90 days the bot simply accumulate losses, some more severe than others. With time the average lifespan did increase to 6 months (180 days). We are unconfident many of the new crypto traders are aware of theses statistics.

Being lured into purchasing trading bots or indicators will probably thrive on Telegram and other social media channels. There is no magic formula for trading. From our experience, we have seen forex trading bots that were successful for some time. Failure to tweak the robot to the ever-changing market conditions often leads to consecutive losses.

Ethereum Signal

It may provide an intraday buy signal but very short-lived. A short entry will only be provided should the price re-test $41,100 after reaching $28,930. Should the price begin correcting higher prior to reach $28,930 there is little that can be done from our angle.

Click on ETHUSD to enlarge the chart:

Ethereum 4hr Chart 23 May 2021 - by ddmarkets

As opposed to Bitcoin, Ethereum (ETH) may post some corrective gains. We paying close attention to the 4hr chart, we require a 4hr close (in several hours at the time of this writing).

Should we have an entry you will be notified via email. We are aware that most cryptocurrencies tend to rise and fall together. Nevertheless we choose to focus on strict technical analysis.

Ethereum Signal

Click on the chart to enlarge:

ETHUSD 4hr Chart Signal 23 May 2021 - ddmarkets

ETHUSD 4hr Chart Signal 23 May 2021 – ddmarkets

The following was sent to all members via email:

ETHUSD long at market price (2,025)
Take profit: 2,440
Protective stop: 1,708
Risk Ratio (RR): 1: 2.2 (approx.)
Estimated duration: 4 days

Relevant as long as ETHUSD is below 2,100

Note: This is a 4hr entry. The potential drawdown is a re-test of 1,718.

Date: 23 /05 /2021

ETHUSD Signal Update

Click on the chart to enlarge:

ETHUSD Signal Profit May 2021 - ddmarkets

ETHUSD Signal Profit May 2021 – ddmarkets

Target has been acquired.

Bitcoin Signal

We will now discuss our trading strategy and signals. We will begin with bitcoin.

Click on BTCUSD to enlarge:

Bitcoin Daily Chart Strategy 23 May 2021 - by ddmarkets

The above charts our BTCUSD daily and weekly charts. $28,930 is currently the key level. The price is attempting to form top Head-And-Shoulders (H&S). The shadow of the weekly may or may not count as a re-test of $28,930.

At the time of this writing there is a fair probability bitcoin may re-test $28,930. This does not mean however there is a sell signal. We will have to wait and see what will happen should the price re-test $28,930.

Bitcoin Signal

Please click on the chart to enlarge:

BTCUSD Daily Chart Signal 28 May 2021

The following was sent to all members via email:

BTCUSD short at market price ($36,736)
Take profit: $28,950
Protective stop: $38,900
Risk Ratio (RR): 1: 3.6 (approx.)
Estimated duration: 4 days

Relevant as long as BTCUSD is above $36,100

Note: This is a daily entry. The potential drawdown is a re-test of $38,200. This is a late entry as the price already corrected lower. The price was near $41,100 (in green), which acted as the near resistance. As the resistance was re-tested and held firm, it may provide a short entry.

Date: 23 /05 /2021

BTCUSD Short Signal Update

We are noting the downtrend is weakening at the time of this writing. While the objective of the downtrend may still be relevant we are reluctant to absorb potential corrective gains.

Click on the chart to enlarge:

BTCUSD Daily Chart 30 May 2021 - ddmarkets

BTCUSD Daily Chart 30 May 2021 – ddmarkets

We decided to exit the short trade at market price ($34,474).

To receive our trade alerts see more information on the crypto signals we provide.

Last Updated on June 15, 2021