Bitcoin Down as Tether Drops Again

As we can see on the chart below, the zig-zag movement in BTC/USD continues. After last week’s small rally this week we’re witnessing a selloff.

The divergence between tether and USD-based bitcoin exchanges continues. On Bitfinex one coin is selling for $6,476 dollars at the moment. On other exchanges like BitStamp and Coinbase bitcoin is trading at average of $6,277 dollars. This is due to the lower price of tether, a so called ‘stablecoin’ that is used as a substitute for USD on exchanges that have banking issues. Tether is trading at 97 cents right now, 3% below it’s ‘peg’.



Three days ago Bitfinex increased their fiat withdrawal fee to 3% for some customers. This quickly resulted in the market discounting the value of tether from around 99 cents down to 97 cents. The market is indicating that the banking problems for Bitfinex are not over yet. Last month when the latest tether drama started we wrote about tether and it’s influence on the crypto ecosystem. Let’s repeat some of what we wrote for newer readers.

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LTC/USD

The price of Litecoin has fallen by 16.34% from yesterday’s high at $51.38 and is currently being traded at $42.8.



Looking at the hourly chart, we can see that the price fell through the descending channels resistance with a massive momentum as the majority of the decline happened in only 8 hours. Currently, the price is below the S2 support line at $44.621. I’ve labeled as a support zone forming a cluster around those levels. The wicks from the downside are indicating that some support has been found but I believe that it will hold only temporary.

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LTC/USD

Since 6th of November, the price of Litecoin has been in a downtrend and on last Thursday the price was $45.385 at the open. From there the price stagnated at first but at the start of this week on Monday the price started to decrease again falling further down to $32.813, which is the yearly low.

The price has been consolidating and is now at around $34.64, which is an overall decrease of 23.40% in the last seven days.



As you can see from the hourly chart, the price went below the descending channels support (black interrupted line) and below the horizontal support level at $38.21. The price found support on the next horizontal support level at $33.29 and has been consolidating above it since then. The consolidation has a symmetrical triangle shape, which indicates equal aggressiveness from both sides.

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LTC/USD

From last Thursday when the price of Litecoin was $35.419 at its open, measured to the current levels on which the crypto is being traded, the price has only decreased by 1.08%. The price did go lower from last Thursdays open, as it was the minor Z wave ending point from which another drop has been made to $27.46 area where the horizontal significant level is.



Looking at the hourly chart, you can see that the price interacted with the mentioned level with a spike down on Sunday when the cryptocurrency market was at its lowest from the start of the year. Since the low has been made the price started to recover and has at first came up to the downtrends resistance line where it got rejected. But as the rejection ended with a higher low, enough momentum was picked up for a breakout at the second attempt.

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LTC/USD

Since our last week analysis on Thursday, November 29th, when the price of Litecoin was at $35.14 measured to the current levels at around $29.6, the cryptocurrency has decreased in value by 15.87%.



Looking at the hourly chart, you can see that the price didn’t go down in a straight line. Instead, the price fell at first to around $32, which was considered to be a higher high at the time a normal retracement after the upswing that broken the prior downtrend resistance. But as you can see the price increased again after establishing support but failed to exceed the prior high as it came to $35.4 area again and was stopped out.

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BTC/USD

At the moment of our last week’s analysis on Tuesday, December 11th the price of Bitcoin was $3524.5. As the price was in a downward trajectory it kept falling after a small increase and has broken some minor support trendlines in the process line, the minor uptrend line from the December 7th low and the horizontal support level from that low as well and came down to the next significant horizontal level at $3237, which served as support. This whole down move dating from 9th of December when the price of Bitcoin came up to $3713 at its peak is the corrective wave X, which meant that another increase was to be expected to around the same levels or a bit lower than the hight of the W wave ending point.



This is exactly what happened as the price of Bitcoin increased by 14% from the horizontal support level at $3237 to $3683, which is close to the vicinity of the W wave ending point. Now, when the price has reached those levels and the Y wave is most likely over, we are seeing a correction and judging by the wick from above the price has encountered the sellers’ territory. This pushes the price back, most likely to the black bold line, which is the baseline support 2 of the downtrend, where it is going to retest the support as the price previously broke it from above.

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BTC/USD

From January 1st when the price of Bitcoin was $3797 at its lowest the cryptocurrency price has increased. BTC/USD is currently trading at around $4140 which is an increase of 9%. The price went further up since the start of the year and was $4218 at its highest point so far on Sunday.



On the hourly chart, the price action has created a triangle, and the price has broken out from it on Sunday when it reached $4218 making it the yearly high so far. The BTC/USD pair broke the horizontal resistance at around $4000 as well a minor one at $4081 (the prior two highs level). The BTC price also broke the descending channel formed since the price reached the bold black line. As the cryptocurrency moved close to the black bold line, the significant downtrend support, it’s likely going to retest the level from the downside again.

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