Cryptocurrencies are everywhere as they march from the sidelines into the mainstream. While many enthusiasts and backers of the technology behind the coins welcome the developments, moving into the mainstream always attracts global regulators. Bitcoin lead the way and was created in the aftermath of the last global financial crisis as the existing financial system was viewed as deeply flawed and an alternative was sought. As Bitcoin as well as other cryptocurrencies try to carve out a spot inside the global financial system, the threat looms that they will have to change until they become part of the system they were initially meant to improve and replace.
As regulators around the planet discuss how to regulate the crypto market, one of the biggest unanswered questions remains if cryptocurrencies are a viable tender for good and purchases and so far the overwhelming consensus was that they are not. Volatility is one of the biggest obstacles together with transactions times in order to convert cryptocurrencies into fiat currencies. While the blockchain technology which is behind the coins is remarkable and allows for vast improvements across industries, there are flaws which need to be addressed.
After the price of one Bitcoin peaked at $20,042.90 on December 17th 2017, it plunged by 69.06% to 6,202.21 on February 6th 2018. A 91.52% rally to 11,878.70 was concluded on February 20th 2018 and the price is now moving lower once again together with all other major crypto currencies. Traders should now eye the $3,675.27 level as the next potential support level. The latest round of the crypto sell-off was lead by Ethereum which tumbled far greater than its peers. More volatility should be expected as the G20 Finance Ministers will meet in Buenos Aires later this week. Digital assets are top priority.
One great way to reduce exposure to cryptocurrencies and to diversify risk is to deposit a portion of the coins with a forex broker such as PaxForex who accepts Bitcoin as well as Ethereum. As more steps will be taken to reign in the wild rides of cryptos with regulation of exchanges to initial coin offerings, downside pressure will remain. Open your PaxForex Trading Account today and decrease your risk profile while boosting your earnings potential.
Most of the cryptocurrency trading takes place in Asia and Japan is leading the push for regulation. Since last year, crypto exchanges have to be licensed. China is taking steps in a different direction with banning exchanges as well as ICO’s, blocking online access to platforms outside of China and by cutting power to mining farms. South Korea is working in tough regulation in order to combat fallout. Other regulators in the EU, the US as well as around the G20 will follow suits. This would most likely push cryptocurrency prices to new multi-year lows. Here are three forex trades which will help smart crypto traders as well as all regular forex traders profit from the G20 storm on cryptocurrencies.
Forex Profit Set-Up #1; Buy USDSGD - D1 Time-Frame
This currency pair exited its sell-off after a successful breakout above its horizontal support area. Following the push higher, the USDSGD tested the upper band of its support area two more times which confirmed the validity. In the process, an ascending support level emerged which is now additionally applying upward pressure on price action. Forex traders are recommended to enter long positions above and below the ascending support level.
The CCI confirmed the momentum change from bearish to bullish after accelerating from extreme oversold conditions, below the -100 level, to the upside. This indicator is now trading in positive territory and provides the final buy signal for the USDSGD. Download your PaxForex MT4 Trading Platform now and profit from the next move to the upside.
Forex Profit Set-Up #2; Sell EURHKD - D1 Time-Frame
Price action has collapsed below its horizontal resistance area after a failed breakout attempt and momentum has now turned to bearish. Current resistance was tested on five occasions and was able to reject a further advance in the EURHKD. A descending resistance level is set to further push this currency pair to the downside. Forex traders are advised to seek short entries on potential short-term rallies back into its descending resistance level.
The CCI briefly spiked into extreme overbought conditions above the 100 mark, but has quickly reversed direction which led to a bearish crossover below the 0 level. This technical indicator is now trending lower in negative territory with more downside expected. Subscribe to the PaxForex Daily Forex Technical Analysis and remain one step ahead of the crowd.
Forex Profit Set-Up #3; Buy CHFJPY - D1 Time-Frame
Selling pressure in the CHFJPY is being replaced by bullish momentum as this currency pair corrected from its horizontal resistance area down into its horizontal support area. The last two daily candlestick formations show a bullish pattern which further signals the end of the most recent sell-off. A breakout above the upper band of its current horizontal support area is expected to result in a short-covering rally. Forex traders should spread their buy orders between 110.800 and 111.650 in order to reduce risk and maximize profit potential.
The CCI, a technical momentum indicator, has ascended above the -100 level which identifies extreme oversold conditions. In addition a positive divergence has formed with offer a strong bullish trading signal. Learn how to add over 500 pips to your forex trading account with the help of the PaxForex Daily Fundamental Analysis which can be delivered directly into your inbox.