Cryptocurrencies bounced back on Tuesday as investors are trying to find reasonable prices to buy after the recent declines. Bitcoin is trading above the 7,400 area, while Ethereum is back above 560.00.
Bitcoin performs an engulfing candlestick on daily chart
Bitcoin fell to its lowest level since April 12 against the US dollar at 7,040; however, the pair managed to bounce and it rose back to trade above the dynamic line coming from September 2017 at 7,400.
BTC/USD closed Tuesday at 7,465, and it is now trading 1.10% positive on the day at 7,542. The crypto king performed a daily engulfing candlestick on May 29 that can be a hint for further recovery. Especially after Wednesday’s continuation.
Thought expectations for a recovery are very limited right now. If the pair consolidates levels above the 7,400 dynamic line, some hope for gains can be expected.
In any case, BTC/USD is trading at intra-week highs, and a close above the 7,660 area would be a confirmation for a possible recovery for the cryptocurrency. In this case, next resistances are at the 8,000 and 8,600 regions. Then, 9,000, and 9,500.
To the downside, a return below the 7,400 would open the doors for more weakness with the 7,000 area as the primary support. Below that, 6,500 and the crucial 6,010.
Ethereum back above the 560.00 area
Ethereum didn’t perform an engulfing candle, but it recovered the 560.00 critical area after bouncing back from its lowest level since April 18 at 507.00 to close at 566.66 on Tuesday.
ETH/USD is now trading at 577.00, 1.80% up on the day. The second cryptocurrency by market value is joining the positive environment that the crypto market is performing currently.
If the pair stays above the 560.00 area, it will find next resistances at the 600.00 and 645.00 areas. A close above the 20 and 50 days moving average would be a signal that more bullishness is expected.
To the downside, the cross needs to get back below the 560.00 area to demonstrate that the previous bounce was a failing break. Then, 500.00 will be the next significant area, and nothing else is in between there and the 400.00 area.
Korea to allow ICOs again
The National Assembly of Korea is officially proposing new legislation to permit ICOs as long as investor protection is put in place according to the BusinessKorea report.
In September 2017, Korea Government and the Financial Services Commission banned token sales as part of ICOs as they considered that these instruments were a violation of the capital market law.
However, Korean lawmakers are now calling for the creation of a task force to increase the transparency of cryptocurrency regulation within the South Korean Cryptocurrency Exchange The idea is to strength regulation but at the same time, provide blockchain technology with all it can need.
El-Erian anticipates a government-issued cryptocurrency
Famous economist Mohamed El-Erian sees an “official sanctioned” cryptocurrency as we are moving “away from cash.” However, he doesn’t see it in the next five years, as structural changes don’t happen overnight.
El-Erian believes that the world will live in a no-paper money economy with digital payments becoming the standard. “Is there a role for cryptocurrency in the future? Yes, but critically, officially sanctioned, that’s very different,” said El-Erian, economic advisor at Allianz.
In an interview with CNBC, El-Erian stated that “we are moving away of cash” with no doubts. He mentioned Sweden as a sample of how fast one can move away from cash.