Analyses

Protest Takes Place Before Official BTC Adoption in El Salvador – Analysis, 7 Sep

Woman Holding Dollar Bills Technical Analysis Bitvalex 7 September 2021

Last week a Bitcoin protest took place in El Salvador. On Wednesday, September 1st, some El Salvadorans went to the streets to protest against the adoption of Bitcoin as legal tender in the country. However, El Salvadoran Bitcoin activists highlighted that just a handful of people participated in the protests, and the media outlets were trying to exaggerate the event:

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Source: Twitter

Although some people were protesting against the law in the country’s capital San Salvador, in other parts of El Salvador, cryptocurrency enthusiasts started to pay with Bitcoin. For example, well-known Bitcoin bull and libertarian Alex Gladstein recorded a video in which he bought a coffee by paying in Bitcoin in El Zonte:

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Source: Twitter

In the crypto community, El Zonte is known as the Bitcoin Beach – a place that has already adopted Bitcoin in the everyday lives of its residents. This way, El Zonte has already attracted many crypto enthusiasts from all over the world.

On September 6th, the President of El Salvador Nayib Bukele tweeted that on September 7th, the country will become the first nation that will officially adopt Bitcoin as a legal currency, and because of this, ‘all the eyes of the world will be on El Salvador’:

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Source: Twitter

Many cryptocurrency enthusiasts underlined that this is a historical event that is going to change the world:

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Source: Twitter

Interestingly, some Bitcoin bulls decided to initiate a movement called #september7buybitcoin (where everyone buys Bitcoin for at least $30) on Twitter and Reddit to support the El Salvadorans by increasing the buying pressure on BTC.

In the days before September 7th, the official day of the Bitcoin acceptance in El Salvador, the prices of most of the major cryptocurrencies went up significantly. However, the Monday market starts with a tight consolidation. According to Coin360.com, one Bitcoin costs €44,353.32 (+1.73%), one Ethereum – €3,303.84 (-0.21%), one DOGE – €0.2570 (-0.74%), and one UNI – €24.21 (-3.21%): 

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Source: Coin360.com (Daily crypto market performance)

Now, let us look at the price charts of the leading cryptocurrencies against the euro in the most notable time frames.

BTC/EUR

In the monthly time frame (MN), after the Bullish Engulfing, BTC/EUR has formed a bullish candlestick for August with a local low above the previous one and a local high above the previous one as well:

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The bullish candlestick for August confirms the dominance of the buyers over the sellers. It increases the chance for uptrend renewal.

In the shorter time frames, the sentiment remains bullish as well. For example, in the 4-hour chart (4H), BTC/EUR has started to move forward within a new Ascending channel (uptrend):

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Although the new Ascending channel has a less bullish slope than the old one, we expect the price of Bitcoin to continue its upward journey.

ETH/EUR

In the weekly chart (1W), ETH/EUR has drawn a solid bullish candlestick after the Hanging Man and Doji candlestick formations:

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As can be seen from the chart, the bullish candlestick has a local low above the previous one and a local high significantly above the previous one. We consider this as a signal indicating that the buyers’ pressure is starting to increase.

That is why, as already mentioned, in our previous two analyses, if, in the daily time frame (1D), ETH/EUR pulls back to the lower line of the Ascending channel (uptrend), we will wait for a rebound to open a long position:

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We will continue to apply this trading strategy within the Ascending channel in the 1-day chart as long as in the weekly chart the sentiment is bullish.

DOGE/EUR

In the monthly chart (MN), DOGE/EUR has formed a Bullish Engulfing in August:

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Since the Bullish Engulfing candlestick formation is a common trend reversal pattern, according to the technical analysis theory, we expect the price of Dogecoin to put an end to the correction in the monthly time frame. That’s why we consider two scenarios in the near future. Either the price of DOGE/EUR will start to move sideways (neutral), or it will begin to increase (bullish scenario).

For the more active traders, it is worth paying attention to the 4-hour chart (4H) of Dogecoin where DOGE/EUR has formed a Bullish Flag (common trend continuation pattern):

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According to the chart, DOGE/EUR is trying to break through the upper (resistance) line of the flag. If this breakout takes place, we expect the uptrend to resume.

UNI/EUR

In the monthly chart (MN), UNI/EUR has recorded a solid bullish candlestick after the Hammer – a combination of candlestick formations pointing to a potential uptrend renewal:

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Because the bullish sentiment is returning to the market in the monthly time frame, it is worth trying to spot a buy signal in the shorter time frames. For example, in our previous analyses, we outlined the Bullish Flag in the 4-hour time frame (4H):

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As can be seen from the chart, UNI/EUR has already exited the flag. Right now, it is testing the upper line of the flag. If the price rebounds from the upper line of the flag, a buy signal will appear.

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The analysis is purely informational and does not constitute investment, financial, trading, or any other sort of advice and you should not treat any of Bitvalex's content as such. Bitvalex does not recommend that any cryptocurrency should be bought, sold, or held by you. You are solely responsible to conduct your own due diligence and consult an advisor before making any investment decisions.


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