Ethereum, Litecoin, and Ripple’s XRP – Daily Tech Analysis – January 29th, 2021

Ethereum, Litecoin, and Ripple’s XRP – Daily Tech Analysis – January 29th, 2021

Ethereum

Ethereum rallied by 7.46% on Thursday. Partially reversing a 9.28% slide from Wednesday, Ethereum ended the day at $1,333.61.

A mixed start to the day saw Ethereum fall to an early morning intraday low $1,220.08 before making a move.

Steering clear of the first major support level at $1,173, Ethereum rallied to a late intraday high $1,363.27.

Ethereum broke through the first major resistance level at $1,343, before easing back to end the day at sub-$1,340 levels.

At the time of writing, Ethereum was up by 0.81% to $1,344.00. A mixed start to the day saw Ethereum slip to an early morning low $1,331.35 before rising to a high $1,345.29.

Ethereum left the major support and resistance levels untested early on.

For the day ahead

Ethereum would need to avoid a fall through the pivot level at $1,306 to support a run at the first major resistance level at $1,391.

Support from the broader market would be needed, however, for Ethereum to break out from Thursday’s high $1,363.27.

Barring an extended crypto rally, the first major resistance level and resistance at $1,400 would likely cap any upside.

In the event of another extended crypto rally, Ethereum could test the second major resistance level at $1,449 and resistance at $1,500.

Failure to avoid a fall through the $1,306 pivot would bring the first major support level at $1,248 into play.

Barring an extended sell-off, however, Ethereum should steer clear of the 23.6% FIB of $1,148. The second major support level at $1,162 should limit the downside.

Looking at the Technical Indicators

First Major Support Level: $1,248

Pivot Level: $1,306

First Major Resistance Level: $1,391

23.6% FIB Retracement Level: $1,148

38.2% FIB Retracement Level: $944

62% FIB Retracement Level: $614

Litecoin

Litecoin rallied by 8.89% on Thursday. Partially reversing a 9.08% slide from Wednesday, Litecoin ended the day at $133.61.

A mixed start to the day saw Litecoin fall to an early morning intraday low $120.91 before making a move.

Story continues

Steering clear of the first major support level at $115.38, Litecoin rallied to a late intraday high $136.29.

Litecoin broke through the 38.2% FIB of $125 and the first major resistance level at $132.51.

In spite of a late pullback to end the day at $133 levels, Litecoin avoided a fall back through the first major resistance level.

At the time of writing, Litecoin was up by 1.55% to $135.68. A bullish start to the day saw Litecoin rise from an early morning low $133.58 to a high $136.06.

Litecoin left the major support and resistance levels untested early on.

For the day ahead

Litecoin would need to avoid a fall through the $130.27 pivot level to support a run at the first major resistance level at $139.63.

Support from the broader market would be needed, however, for Litecoin to break out from Thursday’s high $136.29.

Barring an extended crypto rally, the first major resistance level and resistance at $140 would likely cap any upside.

In the event of an extended breakout, Litecoin could test resistance at $150 before any pullback. The second major resistance level sits at $145.65.

Failure to avoid a fall through the $130.27 pivot level would bring the 38.2% FIB of $125 and the first major support level at $124.25 into play.

Barring another extended sell-off, Litecoin should steer clear of the second major support level at $114.89.

Looking at the Technical Indicators

First Major Support Level: $124.25

Pivot Level: $130.27

First Major Resistance Level: $139.63

23.6% FIB Retracement Level: $148

38.2% FIB Retracement Level: $125

62% FIB Retracement Level: $87

Ripple’s XRP

Ripple’s XRP rose by 5.63% on Thursday. Partially reversing a 6.51% decline from Wednesday, Ripple’s XRP ended the day at $0.26476.

A mixed start to the day saw Ripple’s XRP fall to an early morning intraday low $0.24749 before making a move.

Steering clear of the first major support level at $0.2402, Ripple’s XRP jumped to a late intraday high $0.27076.

Ripple’s XRP broke through the first major resistance level at $0.2653 before pullback back to end the day at sub-$0.2650 levels.

At the time of writing, Ripple’s XRP was up by 1.39% to $0.26844. A bullish start to the day saw Ripple’s XRP rise from an early morning low $0.26487 to a high $0.27000.

Ripple’s XRP left the major support and resistance levels untested early on.

For the day ahead

Ripple’s XRP will need to avoid a fall through the $0.2610 pivot level to bring the first major resistance level at $0.2745 into play.

Support from the broader market would be needed, however, for Ripple’s XRP to break out from this morning’s high $0.2700.

Barring an extended crypto rally, the first major resistance and resistance at $0.2750 would likely cap any upside.

In the event of an extended rally, Ripple’s XRP could test resistance at $0.2850 before any pullback. The second major resistance sits at $0.2843.

Failure to avoid a fall through the $0.2610 pivot would bring the first major support level at $0.2512 into play.

Barring another extended crypto sell-off, Ripple’s XRP should steer clear of sub-$0.25 levels. The second major support level sits at $0.2377.

Looking at the Technical Indicators

First Major Support Level: $0.2512

Pivot Level: $0.2610

First Major Resistance Level: $0.2745

23.6% FIB Retracement Level: $0.6274

38.2% FIB Retracement Level: $0.5285

62% FIB Retracement Level: $0.3687

Please let us know what you think in the comments below.

Thanks, Bob

This article was originally posted on FX Empire

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Valid Points: What to Expect When Ethereum 2.0 Undergoes Its First ‘Hard Fork’

Eth 2.0 is looking at its first hard fork this year.

The Ethereum Foundation-backed research team is currently organizing schematics for a mid-2021 backward-incompatible change to the Beacon Chain, according to a Jan. 14 developer’s call.

This hard fork is really not a hard fork in the traditional sense, Teku client project manager Ben Edgington pointed out. Rather, it’s a warmup before sharding and a merge of the Eth 1.x and Beacon Chain.

Related: Blockchain Bites: Scaramucci on GameStop and Bitcoin; Why Flamingo DAO Dropped $762K on an NFT

“The word ‘fork’ is heavily overloaded in blockchain usage. In fact, there shouldn’t even be a fork when this upgrade is done, in the sense of the network ending up with multiple competing chains,” he wrote in his Eth 2.0 blog post on Jan. 15.

The upgrade is likely to include the following code changes, although these changes have yet to be fully agreed upon:

Infrastructure for light client support through sync committees. Light clients enable verification of the chain without needing as much overhead as a typical validator rig.

A new function, called balance_denominator, changing in-activity penalties against non-participating validators. The current penalty method is a denial-of-service (DOS) vector while the new function increases the chain’s efficiency, Eth 2.0 researcher Danny Ryan wrote on GitHub.

Rewards will be calculated over an epoch (similar to a block) instead of after the epoch closes as is currently done. Egington notes the change should help limit the number of incorrect attestations.

Ice Age on Eth 2.0?

One additional feature that is being considered is the inclusion of the difficulty bomb, also known as the “Ice Age.” The difficulty bomb – which kicks into gear at pre-set block heights – is a mining adjustment mechanism originally added to the Eth 1.x blockchain in 2015. It makes mining incrementally more difficult over time in an effort to keep developers motivated to build Eth 2.0.

Story continues

To date, the Ice Age has been postponed three times on the proof-of-work (PoW) Ethereum blockchain in the Byzantium (2017), Constantinople (2019) and Muir Glacier (2020) hard forks.

Related: First Mover: Risks Nobody’s Ever Seen, From the Fed to Tether (and GameStop)

The difficulty bomb is a staple of Ethereum as it pushes economic incentives on developers to keep innovating on the baselayer. Yet, it’s unlikely to be included in Eth 2.0 as there’s already an economic force pushing Beacon Chain development, Ryan told CoinDesk in a yet-to-be-released Mapping Out Eth 2.0 podcast.

“There is no Ice Age on the Beacon Chain, but it essentially has a forcing function because right now there is 2.5 million ETH locked into the system,” Ryan said. “There’s no way developers in the community at that order of magnitude would allow it to live in parallel and not have it do anything more.”

The decision to include or not include a difficulty adjustment feature like the Ice Age into Eth 2.0 itself comes down to how you see the Ethereum blockchain progressing after Eth 2.0 is complete, he said. Some want further innovation while some think ossification similar to Bitcoin’s blockchain is the way to go.

“Some want to continue to upgrade and iterate and bring in the latest cryptography into Layer 1. I’m sure the debate whether an Ice Age should exist in Ethereum 2.0 will center around some of those ideas of ossification versus continual upgrades,” Ryan said.

Eth 2.0 reaches all-time high for network participation

The Ethereum 2.0 network continues to grow at a steady pace and at near-perfect user participation levels. On Saturday, Jan. 23, Eth 2.0 reached its highest daily average network participation rate at 99.46%. This indicates that, despite a growing number of participants, validators on Eth 2.0 are largely engaged in securing the network and earning rewards.

As background, the economics of Ethereum 2.0 operates on a sliding scale of rewards that adjusts dynamically based on the total number of active validators. The larger the number of validators staked on Eth 2.0, the lower the total amount of rewards issued on the network. (Read more about Eth 2.0’s monetary policy here.)

The daily average of rewards earned per validator dipped to a seven-week low on Thursday, Jan. 21, at 0.007235 ETH. However, due to the bullish price activity of ether in the crypto markets, the value of rewards earned on the network has increased 81.47% over the same time period. In other words, because the ETH price has risen, validators are earning more on average per day in U.S. dollar (USD) terms.

Breakdown of Eth 2.0 user deposits

One other useful metric for evaluating ongoing network health and decentralization is the breakdown of user deposits on Eth 2.0. According to a tool still in beta testing by blockchain explorer Etherscan, roughly 50% of all ETH deposits are made by cryptocurrency exchanges and staking pools.

This suggests an equal balance between individuals choosing to stake using their own hardware and software and those who choose to rely on a service provider to do it for them. Shifts in this distribution over time will indicate growing advantages as well as disadvantages, swaying users towards one method of staking on Eth 2.0 versus another.

For now, the even distribution of Eth 2.0 depositors is a strong indicator that running hardware independently versus relying on a provider to do it for you are both equally attractive options for users.

Validated takes: Further reading from the past week

The bull case for cryptography by Justin Drake (Podcast, Bankless)

Big investors stacked up ether as price rose to record high (Article, CoinDesk)

Ethereum-based ConsenSys Quorum partners with China’s BSN blockchain (Article, CoinDesk)

Minority mining pools threaten to collude against contentious Ethereum upgrade (Article, CoinDesk)

More institutional investors are buying ether and seeing it as a store of value (Article, CoinDesk)

Ethereum NFTs are getting merged with augmented reality (Article, Decrypt)

Smart contract platforms and DeFi are outperforming in 2021 (Blog post, Into The Block)

Ethereum 2.0 client team Prysmatic Labs’ summary of 2020 (Blog post, Prysmatic Labs)

Factoid of the week

We’ll soon be incorporating data directly from CoinDesk’s own Eth 2.0 validator node in our weekly analysis. All profits made from this staking venture will be donated to a charity of our choosing once transfers are enabled on the network. For a full overview of the project, check out our announcement post.

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The housing market has been one of the most vibrant corners of the pandemic-era economy, but a new survey finds more than half of Americans believe it will crash either this year or next year. What Happened: The survey by LendingTree Inc. (NASDAQ: TREE) polled 2,051 adults conducted between Dec. 17-20 and found 41% of respondents predicting the housing market bubble will deflate during 2021 and force accelerating home prices to fall. Another 26% of respondents forecasted the same scenario in 2022, while 13% did not see another housing market crash in the near future. LendingTree’s Chief Economist Tendayi Kapfidze cast his lot with the 13% of naysayers. “Though housing heated up late in 2020 and growth is likely to slow in 2021, the idea that it’s a bubble that would burst seems unlikely,” said Kapfidze. “The mortgage market is healthier than it was prior to the 2008 crisis, and the government is more experienced with interventions that protect the housing market like forbearance and mortgage modifications.” The latest housing data is also not detecting any fissures in the market. This week’s S&P CoreLogic Case-Shiller Index found sales were going stronger than ever into the autumn. “With existing home sales up over 20% from a year ago, S&P CoreLogic Case-Shiller Index clocked a 9.49% surge in November – a new high since February 2014,” said CoreLogic Inc. (NYSE: CLGX) Deputy Chief Economist Selma Hepp, adding that “buyer competition reached a new peak nationally in October and November when the ratio climbed to 0.996 – the highest level since 2008, when the data series began.” Mat Ishbia, president and CEO at Pontiac, Michigan-headquartered United Wholesale Mortgage (NYSE: UWMC), is also expressing confidence. “I think the main trend is going to be a very, very strong mortgage and housing year across the board,” he said. “Rates are very low, the economy is recovering, and will recover. Housing demand is great, millennials are buying, mortgage brokers are growing their business channel, and the education of consumers is happening. I think 2021 is going to be one of the best years in history from a mortgage perspective.” Why It’s Important: Ishbia’s company went public last week and is the first in a growing queue of housing industry companies that are responding to the vitality of the housing market by readying for the initial public offering route. The residential brokerage Compass, the residential mortgage lender and servicer AmeriHome, and Home Point Capital Inc., the parent company of the mortgage originator and servicer Home Point Financial Corp., announced plans earlier this month to pursue IPOs. Several mortgage companies that announced plans for an IPO in late 2020 — including loanDepot, Caliber Home Loans and Finance of America — are in a holding pattern and have yet to proceed. Ishbia’s concern with the housing market is not aimed at consumer confidence, but instead is centered on whether mortgage companies are able to handle the continued buyer demand. “Most of the companies that have really struggled are ones that have not invested in technology,” he said. “We’re in an interesting industry because nobody wants our product that we’re selling. “Nobody wants a mortgage, they want the house, right? Or they want the savings. So how do you make it faster and easier? “People really have to go all-in on technology,” he continued, because too many times companies in our industry spend a lot of time partnering with this vendor and kind of doing a halfway job of really investing in technology. You’ve got to be all-in with technology if you’re going to make the process faster and easier for consumers. If you’re doing that, you’re going get a lot more business.” And despite the pessimism that many Americans shared with LendingTree, 80% of those polled in the new survey said they still considered the American Dream to be defined by homeownership, with 45% predicting more affordable opportunities will be made available through the policies of the Biden administration. But not everyone is that optimistic: 31% of survey respondents predicted the new administration will bring fewer affordable housing options and 40% said the historically low mortgage rates that encouraged increasing home sales will begin to rise this year. See more from BenzingaClick here for options trades from BenzingaWhy The Fate Of Fannie Mae, Freddie Mac Remains UnclearWhat Biden’s Executive Order Means For Private Prison Stocks© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.