Last week in the news

Geopolitical tensions shaped investors sentiment during the previous week. Markets ended a week in red. Bitcoin is testing support at $40K, while Ether is still trying to hold to $3K level.

The US inflation is continuing to be one of the main concerns on the financial markets. As FED officially  takes a calmer note, not all FED members are in agreement with that. During the previous week`s panel talk at Columbia University, St. Louis FED President James Bullard, pointed out high risks of inflation and stressed the importance of FED`s immediate reaction. He expressed a view that an increase of interest rates of one whole percent is necessary.

One of the popular investors in tech companies, Cathie Wood, founder of ARK Invest, noted in an interview with CNBC, that the portfolio of ARK Invest is “way undervalued”. The fund had suffered losses during the latest decline in the price of tech companies and crypto market, but she still believes in the potential that innovation companies can bring, which will be reflected through their portfolio within the next five years, as per her opinion.

Metaverse is continuing to attract potential users. One of the largest investment banks in the world, JPMorgan announced that it has opened a lounge in the Metaverse Decentraland. Aim of this lounge is to explore possibilities for further business growth within the metaverse segment. As stated, their initial focus will be “metanomics' ' as some assets in the metaverse have doubled their price within a short period of time, like, virtual land. In this sense, “metanomics' ' will be focused on potential financing or renting virtual real estate markets.

Cointelegraph.com is reporting that so-called “mega whales” of XRP coins have accumulated $700 million in the last three months. This accumulation coincides with the spikes of coins against both BTC and USD.

The Russian Ministry of Finance announced the start of the development of a legal framework for digital assets, including digital currencies. Market participants are called for their inputs related to this topic until March 18th. The document should be available for public view within the next three weeks, as announced.

Crypto market cap

Geopolitical tensions are continuing to shape investors' confidence on financial markets. During the previous week crypto market capitalization fell below $1.8 trillion, for the first time since February this year. Compared to the previous week, it represents a drop of 5%, where the market lost some $99B in value. Daily trading volumes modestly decreased on a weekly basis, moving between $120B up to $230B. Total outflow of the funds since the beginning of this year widened a bit to the level of 19% or $409B.

Negative investors sentiment had driven crypto market cap to the downside during the previous week, however, not all coins lost their value. Decrease in market cap in nominal value was driven by the major coins, BTC, ETC, ADA and Solana. Bitcoin lost $40B in market cap or 5%, followed by Ether which decreased its market cap by 5% or $18B. Some of the altcoins which lost the most in a single week were Cardano, with decrease of $2.5B or 7% and Solana, with loss of $1.3B or 4.5%. On the other hand, there are coins which were driving the market to the upside, like XRP, who gained almost $3B in market cap and increased its value by 8%. In a relative value, NEO had a good week with an increase of almost 16% in market cap. Filecoin, increased its market cap by 3.3% within a single week, however, it was supported by increased circulating coins.

The table below provides most recent information regarding market cap and circulating supply for most popular crypto currencies.

Crypto futures market

Investors' decreased confidence due to geopolitical tensions, left its mark on the crypto derivative market. Futures were traded lower from the week before. BTC short term futures were traded down by 6%, while maturities for December this year dropped to $43K from $46K traded in the prior week. ETH short term futures were down by some 5%, while end of December maturity was still holding modestly above $3K.

Table below provides the most recent information on BTC and ETH future prices.

Bitcoin: fundamentals continue to influence market confidence

Second week in a row financial markets are under strong influence of geopolitical tensions, including the crypto market. During the previous week BTC tried to test $45K resistance one more time, however, during the Friday trading, price of the coin returned to the $40K support level.  Crypto futures market also reflected current investors' decreased confidence and dropped below $45K for maturities as of the end of this year.

Two weeks ago MA50 showed some slowdown in divergence from its MA200 days counterpart, however, during the previous week`s drop in BTC price, MA50 continued to diverge from MA200. This adds to the probability that some lower grounds for BTC might be open in the near future period. RSI dropped from level of 60 down to 44, which might add to previous probability that BTC price is still not ready to reach the overbought market. In addition, the level of $40K had been tested as of the end of the previous week, where BTC reached its lowest price at $39.5.

Fundamentals would certainly continue to shape market confidence in the future period. Signals from technical analysis are pointing to the ongoing pressure to the downside. In this sense, the support level at $40K is the level to watch in the coming days. If this level holds, then it is expected that BTC will revert to the upside and levels of $43K, up to $45K resistance lines which might be tested. However, if fundamentals prevail in the coming week, there is a probability that BTC will head toward a $38K support line, eventually $35K to test it.

Ether: $3K continues to be hard task          

Psychological $3K continues to be a hard task for Ether. During the previous week ETH moved to the resistance line at $3.2K to test it for one more time during the last two weeks, however, fundamentals were not on a side of further price increase, so ETH price moved down to support line at $2.850 to test it one more time. Lowest level reached during the week was $2.7K, which indicates that pressures to the downside continue to prevail for ETH.

RSI has moved from levels above 60 down to level of 40, supporting the prevailing downside. Moving average of 50 days continues its divergence from 200-days counterpart, indicating that price is still not ready to switch trend to the clear upside. Support line at $2.630 has not been tested within the latest price move, which leaves some space for ETH to test it in the coming days.

Technical analysis is suggesting that pressures on the $2.850 support line will continue, which increases probability for the next support line at $2.630 to be tested in the coming days. On the opposite side, there is also an equal probability for the $3K resistance line to be tested one more time.

Ripple: is there strength for $0.9?        

Despite decreased market confidence due to negative fundamentals, XRP did not exactly follow the general crypto market trend during the previous week. While other major altcoins were losing some of value, XRP managed to gain 8% on a weekly basis. News are reporting that XRP so-called “mega whales” are active again on the market, increasing their holdings of these coins, however, this story is hard to confirm due to restricted data availability on private coin holdings.

During the previous week XRP price was moving in a range from $0.75 up to $0.85 resistance line. RSI started its way to the level of 50, however, soon reverted to the upside, confirming that the coin is still not ready for its move to the oversold market. Modest positive developments are seen also with moving averages line of 50 and 200 days, which started with their slowdown of divergence from each other.

Current charts are imposing a question if there is strength for XRP to test a long term resistance line at $0.9 in the coming period? Certainly the level to watch in the coming days is current resistance at $0.85 which coin has been tested during the previous week. In case that it is clearly broken, then XRP will certainly head to the road to next resistance at $0.9. In case that market reverts to the downside, there is probability that $0.75 will be tested again with decreased probability for next support line at $0.7.

Binance Coin: market is eyeing oversold zone?

It was another slow-motion week for BNB. Coin started the previous week heading toward the $430 resistance line, however, as of the end of the week it reverted to the downside, but only to the level of the short term support at $400. BNB is ending a week with prevailing pressures to the downside.

Moving averages of 50 and 200 days are continuing their divergence from each other, after a cross made some three weeks ago. This is an indication that the coin is still not ready to revert to the upside, confirming ongoing pressures to the downside. RSI is trying to make a move above the 50 level, but without too much strength the indicator is still holding below this level. It looks like that market is currently eyeing the oversold market, rather than overbought one.

Level to watch in the coming days is a short term support line at $400. In case that this line is clearly broken to the downside, BNB will head toward next short term support at $380, with currently lower probability for the $350 level. On the opposite side, there is a probability for $430 resistance to be tested one more time.

Cardano (ADA):  how strong is $1.0 support?

Since the beginning of this year, ADA is modestly but gradually slowing down its movements. Although the coin is struggling to make a move to the upside, still there are ongoing pressures to the downside, where the level of $1.0 is sort of defend-zone for the current value of the coin. During the previous week ADA reached its lowest level since the end of January this year at $0.988.

RSI made its move from level 47 down to 37, confirming that the market is heading for oversold level. Moving averages of 50 and 200 days are continuing to diverge from each other, not providing an indication of potential price reversal in the near future.

Another week in a row the support line at $1.0 will be in the spotlight of the market, with questions if this line will be able to withhold the ongoing pressures. In case that this line is clearly broken, ADA will make a move toward a short term support line at $0.9. On the opposite side, the next resistance line stands at $1.20 with extremely low probability that it might be tested in the coming days.

LINK: $15 support holds, but for how long?

LINK started the previous week heading toward the $20 resistance line for one more time within the last two weeks. However, this level has not been tested, but instead, LINK made a stop around the short term line at $17.5. After this level, the coin reverted back to the support line at $15, where it is finishing the week.

Moving averages are continuing their quite modest divergence from each other. On charts it looks like they are moving more like two parallel lines not providing much indication on potential stronger price reversal in the coming period of time. RSI is still moving in a zone below level of 50, which might imply that the market is more oriented toward oversold move, than to the opposite one.

Another week in a row $15 is a level which will be in the focus of the market. There were pressures to the downside, however, this level remained intact during previous weeks, which provides some confidence that it will withhold market pressures in the coming days. There is currently quite small probability for this line to be broken, in which case level of $13 is more likely to be tested. On the other hand, there is equal probability for LINK to head one more time toward the short term line at $18 to test it once again, with currently lower probability that $20 resistance might be reached in the coming days.

Disclaimer: This article provides exclusive views of the author. It does not in any sense represent a suggestion for trading.

This Market Analysis has been published by a staff writer at XBTFX.

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