Which Cryptocoin to buy?
For the time being our choice of Cryptocurrencies we are trading is limited to those available on the Kraken platform, which only offers a narrow selection of larger market cap coins. At the time of posting this comprises the following coins:
You can trade Bitcoin(XBT), Ethereum (ETH), Bitcoin Cash (BCH), Monero (XMR), Dash (DASH), Litecoin (LTC), Ripple (XRP), Stellar/Lumens (XLM), Ethereum Classic (ETC), Augur REP tokens (REP), ICONOMI (ICN), Melon (MLN), Zcash (ZEC), Dogecoin (XDG), Tether (USDT), Gnosis (GNO), and EOS (EOS).
We like to trade preferably to the upside, which is the major direction for the blockchain and cryptocurrency complex at large and do not like to sail against the wind.
We do not like to buy in overextended or overbought configurations due to the inherent downside risk when a correction sets in, meaning we avoid buying the tops and prefer to buy the lows.
Zcash, Zbig Move Up Coming?
As nothing in certain in trading activities we prefer to add a question mark to this paragraph’s section. Nevertheless, Zcash (Symbol: ZEC) combines right now a combination of positive technical and supportive fundamental aspects that may propel it higher in the weeks or months to come.
1. Market capitalization
Zcash market cap represents today less than one percent of Bitcoin. It is not a major cryptocurrency but also not an insignificant one and has room for growth and higher ranking:
2. Zcash is used for secure and anonymous payments
Zcash has a good reputation and is used for anonymous online payments. It is quite popular and presently used extensively in the Hacker’s sphere, notably for example by the shadow brokers. Its business case somewhat compares to Monero, that has a more than three times larger market cap and ranks nr. 14.
One year ago Zcash launched a Zcash Multi-Party Computation Ceremony highlighting that:
Zcash’s zero-knowledge proofs rely on a set of public parameters which allow users to construct and verify private transactions. Due to cryptographic limitations, these parameters must be generated in a setup phase: some random numbers are sampled (which we refer to as the “toxic waste”) which are then used to construct the parameters. After the setup phase (aka “The Ceremony”), the toxic waste must be destroyed to prevent counterfeiting of Zcash.
3. Zcash recenly broke out from a longer foundation phase
The Zcash price history is amazing as can be seen on the monthly time scale. It set a price record of somewhere between $20,000 to $30,000 at the time of its ICO in Oct 2016 ($20,000 in case of Bitfinex, monthly chart presented here below) and has plummeted abruptly to a low of $37 in Feb 2017. But as can be seen on a logarithmic time scale, ZEC has broken out of a monthly foundation phase (blue line) in Dec 2017 and made a retest early January of the broken resistance-turned-support line, a so-called inversion of polarity.
How We Will Get Long Zcash?
As can be seen on the weekly price chart ZEC has already broken out from the foundation phase when it moved through the $500 price level, which would have been the ideal time to buy. The weekly price is already in the overbought area but has significant room to move up. We are looking to buy any retest of the $600 price area, which will correspond to the position of the rising upper volatility band by the opening of the week on Monday 8th of December.
This should as well correspond to a retest of the expected level of the supporting 7-period arithmetic moving average (M7) by tomorrow.
The position should be kept open as long as ZEC does not close below significant support levels, which is around $500.
In terms of the medium term objective we expect a move in the $4,000 price area approximately.
- We will buy ZEC if it moves back to $600
- Position will be stopped if it reverses and close decisively below $500
- We target the $4,000 price area
Trading activity to be recorded
We plan to buy ZEC in our Kraken account and whenever activated this will be tracked as the first trade to be entered in the recently created Trading Activities section (empty for now).