• Francisco Hernandez

BTSE token down -45.65% since release, but steadily rising over last week

BTSE-USDT, 6H, BTSE


Introduction

On March 5th, 2020, BTSE, a Bitcoin and Digital Assets exchange, released the BTSE utility token (BTSE), the first exchange token built on Bitcoin's (BTC) sidechain Liquid. This provides users of the BTSE token with fast and confidential transactions, and inter-exchange settlement. Additionally, users who hold the BTSE token receive discounts on trading fees, earn bonuses, and gain access to exchange products and services. Additional user benefits are on the roadmap. There is a total supply of 200 million BTSE tokens with a current circulation of 4.2 million. The supply will reduce to a total of 100 million over time through token burns. The token's initial value was $2.00 and is now worth about $1.07, giving it a market cap of about $4.5 million. In this article, I look at the TA of the BTSE-USDT trading pair on a 6-hour time frame.


BTSE-USDT, 6H, BTSE.


Moving Averages (MA)

The BTSE token saw a sell off of -50.5% in the first 30 days on the market, hitting a low of $0.99 on April 5th, 2020. This, of course, drives the MAs downward. The 20-period MA (red) falls straight down and begins to bottom out the last week of March. The 50- (orange) and100-period MA (yellow) also follow suit. The 20-period MA forms a golden cross by crossing over both the 50- and 100-period MA. Price is currently supported by the 20-period MA, which is still located above the other two MAs. After reviewing the Bollinger Bands and Fibonacci retracements, I will zoom in to the chart for the month of April.

Moving averages.


Bollinger Bands (BB)

Price has generally been riding the lower band, only breaking out over the middle band a handful of times. Price has broken out of the upper band, but only a few times. Price has been stable, moving horizontally since the last week of March. This is evident given the bands are contracted, although not as contracted as they have been in the past. Currently, price is in the upper band and has been for the last few days.

Bollinger Bands.


Fibonacci retracements

The Fibonacci retracements tell a different story than the moving averages above. Here price is being supported by the 23.6% Fibonacci level at $1.76 the first few days after release. Price then broke down past the following three levels and found support at the 78.6% Fibonacci level and testing the 61.8% level as resistance. Again, price broke down but this time towards a 100% retracement. Price bounced and tested the 78.6% level of $1.21 as resistance. Price was rejected and fell to a low of $0.99. Currently, price is located between the last two Fibonacci retracement levels, with support at $0.99 and resistance at $1.21.

Fibonacci retracements.


Zoomed in

From the low of 99 cents, the BTSE token has seen a 9.29% increase to the current price of $1.08. Price pumped for the next 4 days making a lower high of $1.16. Price sees another lower high April 15th. However, since that large red candle on April 9th, price has been rallying upward. Again, price is in the upper Bollinger Band, has support at the 20-period moving average, and formed a golden cross a few days back.

Zoomed in chart with moving averages, Bollinger Bands, and Fibonacci retracements.


On Balance Volume (OBV)

The OBV is suggesting that despite the 50% sell off the sell pressure was steady. The slope of the decrease from initial release towards the end of March is not steep at all. That is, nothing compared to the decrease the OBV sees the first few days of April which made a low. Since that low, the OBV has been rising, making higher highs and higher lows. This is nearly bullish. One more set of a higher high and higher low and I would consider the OBV bullish. Preferably, the OBV moves past its break down point from the end of March.

On Balance Volume.


Chaikin Money Flow (CMF)

The CMF started out below the zero line and bounced up towards the zero line over the first few weeks of release. The CMF bottomed out towards the end of March and started moving upwards in the last week of March. This is one week earlier than the OBV bottomed out and started moving upwards. With the CMF moving upwards this way, it suggests that selling pressure had been reducing. The CMF has been testing the zero line since the start of April and currently is above the zero line, indicating increased buying pressure. The CMF has been making a series of lower highs and lower lows. However, in the last week, the CMF has been making higher highs and higher lows. I would like to see the CMF remain above the zero line and continue to make higher highs and lows in order to consider it bullish.

Chaikin Money Flow (CMF)


MACD

The MACD has been bullishly divergent from the candle chart and both previous indicators since release. While everything else has gone downwards (except for this past week), the MACD line (blue) has been riding over the signal line (red) from the start, crossing below it only three times. When the MACD lines is higher than the signal line the histogram values are positive, which is present here in the chart. The MACD histogram has been positive most of the time. Currently, the MACD line is hovering on the signal line, bouncing below and above the signal line. I want to see the MACD remain above the zero line and for the MACD line to stay above the signal line for it to be bullish. Now, it is not. All other indicators are bullish for the last week, except the MACD.

MACD.


Conclusion

The BTSE token is a new utility token released by BTSE Bitcoin exchange. The token provides users with several benefits, such as fee discounts. In the first couple weeks, the token lost half its value and has been almost worth one dollar since. While the token is down about -45%, it has seen a recent ~10% rally in the last week. When the chart is examined via Heikin Ashi candles, the recent upward trend is evident. There was a correction of 3 red candles in the last few hours, followed by the current two green candles. Heikin Ashi suggests the trend is upward. However, the current candle is dojiish, suggesting price could go either way. It appears that price is facing some resistance around the $1.10 area. I would like to see price approach this area of resistance and close above it to establish a new level of support. Beside this, all other indicators are bullish except for the MACD. I would also like to see the MACD diverge from the signal line in the upward direction. Overall, indicators suggest that the BTSE token is has been and is leaning towards bullish.

Heikin Ashi chart.

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