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Ethereum

3 Technical Signs Suggest Bull Trend Coming

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  • Ethereum has dramatically underperformed Bitcoin over the past two weeks.
  • The coin has gained 13% in the past two weeks while BTC has gained 20%.
  • Analysts think that the gap may begin to close shortly.
  • One trader noted that there are a number of technical signals derived from the Ichimoku Cloud indicator suggesting Ethereum will move higher.

Ethereum Forms Pivotal Bull Signals

Ethereum has dramatically underperformed Bitcoin over the past two weeks. The leading crypto asset has gained around 13% as BTC has surged closer to 20%.

Despite this underperformance on a short term basis, analysts think that ETH will soon see an explosion in price appreciation.

One crypto-asset analyst shared the chart below on October 27th. It shows that Ethereum is currently underperforming BTC but may soon catch up due to a number of technical signals. He specifically pointed to three technical signals, derived from the Ichimoku Cloud indicator. These signals are as follows:

  • Ethereum has retested the flat Tenkan level, which confirms it as support. This level is important for bulls to hold during uptrends.
  • The Chikou is pointing up after the bounce on the Kumo (the cloud).
  • Ethereum’s future cloud has twisted into the green, suggesting a bull trend is forming.

“$ETH hasn’t even started yet: retested the flat Tenkan, chikou pointing up after bounce on Kumo, bullish future (twist). Spot buys done here Ballot box with check. Opening Perps on 1st blue HA candle / break of WF”

Chart of ETH's price action vs that of Bitcoin over the past few weeks with analysis by crypto trader Trading Cyclist (@Fullgastrader)
Source: ETHUSD from TradingView.com

Likely to Outperform BTC Moving Forward

Despite this, analysts think that Ethereum may outperform Bitcoin moving forward.

Su Zhu, CIO and CEO of Three Arrows Capital, recently shared the following sentiment:

“$BTC going up swiftly is not only not bullish for alts but it’s bearish. reasons for this are myriad but boil down to the fact that money is a coordination game and Bitcoin is the Schelling point; this is independent of how you feel about it, community is literally irrelevant.”

We’ve seen this play out quite well over the past week. As aforementioned, as Bitcoin has rocketed higher, ETH has been lagging.

Ethereum may continue higher, though, once Bitcoin begins to consolidate and capital made in BTC longs begins to cycle down the crypto risk spectrum.

This may not take place for a while, though. Analysts also note that the Bitcoin dominance metric, which tracks how altcoins perform against BTC, is set to move higher.

Featured Image from Shutterstock
Price tags: ethusd, ethbtc
Charts from TradingView.com
Ethereum Hasn't Even Started: 3 Technical Signs Suggest Bull Trend Coming





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Ethereum

Price analysis 11/27: BTC, ETH, XRP, BCH, LINK, LTC, ADA, DOT, XLM, BNB

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Bitcoin’s recent correction is healthy, but several altcoins have lost momentum and could remain range-bound for a few days.



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Ethereum

Compound liquidator makes $4M as oracles post inflated Dai price

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The crypto market suffered a powerful crash on Thursday morning UTC, which sent prices of major currencies like Bitcoin (BTC) and Ether (ETH) tumbling in excess of 10%.

When traders rush for the exits, the price of stablecoins generally increase as the demand for stability rises. In today’s crash, however, the effect became particularly pronounced on Dai (DAI), which briefly traded for $1.3 between 7 and 8 AM UTC.

Dai/USD price on Coinbase, courtesy of TradingView

Most notably, DAI traded at this inflated valuation only on Coinbase and Uniswap, while other exchanges including Kraken and Bitfinex seem to have maintained a relatively stable price.

Dai/USD price on Bitfinex, courtesy of TradingView

Coinbase and Uniswap are the two exchanges used by Compound’s Open Price Feed oracle. The former acts as the baseline, while the latter is used as a sanity check and anchor. Nonetheless, it appears that Uniswap failed in its function and also posted a much higher price than normal.

Compound’s liquidation this morning amounted to $89 million, of which about $52 million came from DAI, according to data from DuneAnalytics.

One liquidation in particular is notable for its extremely large size of 46 million DAI repaid.

As DeFi researcher Sam Priestley explained, this liquidation was performed on a leveraged COMP farmer, who used USD Coin (USDC) and DAI collateral to power recursive borrowing in the same currencies. The apparent increase in DAI price put the account below the liquidation threshold.

The liquidator seized almost 2.4 billion cDAI, worth approximately $50 million with a price of $0.0209, while returning just $46 million in DAI. This is expected behavior given Compound’s current liquidation incentive of 8%.

The transaction in question involved the use of a flash swap from Uniswap and calls to update Compound’s oracle. Another four transactions issued by the same liquidator removed an additional $6 million in debt.

The event highlighted the dangers of relying on just a few data points for oracles, Chainlink (LINK) founder Sergey Nazarov told Cointelegraph. “We predicted this very exploit of centralized oracles and poor data quality over a year ago,” he said, mentioning his explanation of the risks of using a single exchange. He continued: 

“DeFi protocols that rely on centralized oracles that pull data from single exchanges, DEXes or otherwise, are inadvertently putting user funds at risk. […] The Chainlink network was unaffected by this exploit because we source data from multiple leading data providers and hundreds of exchanges, making sure we capture the real-world price of a cryptocurrency through proper market coverage.”

While there is no evidence to suggest active manipulation, the fact that DAI price jumped specifically on the exchanges used by Compound’s oracles could draw suspicion. In general, the liquidation adds to the recent flash loan hacks to highlight DeFi’s excessive reliance on just a few data sources as oracles, Nazarov concluded.





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Yearn Finance announces another ‘merger’ with the Cream lending protocol

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Two days after Yearn Finance (YFI) and Pickle Finance joined forces in DeFi’s first effective merger, Yearn founder Andre Cronje published details of another upcoming integration with Cream, a lending protocol similar to Compound and Aave.

The blog post, published on Thursday, outlines how the two protocols will cooperate for the launch of Cream V2. As part of the partnership, the teams will merge development resources and introduce several symbiotic interactions between the two protocols.

Yearn users will be able to put their vault tokens — their share in a yield farming strategy fund — as collateral to borrow on Cream. Furthermore, the farming strategies will be able to access leverage on the platform, potentially increasing their yield.

The cooperation will continue with future releases, with Cream specializing in lending products. Stable Credit, an upcoming lending platform built by Yearn, will be launched through Cream. A zero-collateral protocol that would allow more flexibility in lending was also teased as a future development.

Unlike with Pickle Finance though, the governance and token economics of Cream will remain unchanged. The two protocols will remain largely separate, with synergies more resemblant of a very close partnership, rather than an outright merger.

The community had raised concerns about not being consulted before the Pickle Finance merger, suggesting that the matter should have been put up for a vote. A team member later clarified that it technically did not require approval since most of the integrations were on Pickle’s side.

Chris Blec, a DeFi researcher who often takes an adversarial view of events, believes that these decisions highlight that governance tokens offer less control than people expect.

In a conversation with Cointelegraph, he clarified that these types of decisions would likely fall under the umbrella of “facilitating business development and integrations,” one of the decision-making powers that YFI holders granted to the core team in August.

The Yearn community has so far reacted positively to the Cream integration, but most have yet to process the announcement.

While the core team seems to be within their rights to approve partnerships and mergers, these actions may trigger further discussion of the role of the YFI token holders in the Yearn ecosystem.