Last week in the news

Geopolitics continues to shape investors sentiment on financial markets. US and EU equities are continuing to fall, while Bitcoin returned to the levels around $40K, after being pushed to $45K during the week. ETH is finishing the week flat, above $2.6K.

Ken Griffin, CEO of the Citadel investment company, changed the narrative over the crypto currencies in his latest interview to Bloomberg. He was previously known as an investor who was strongly against crypto assets, naming them a “jihadist call”.  However, in his latest call, he is admitting to be wrong and noting that the company will consider becoming a market maker for cryptos.

Two years after the company ceased its operations in the US, the Chinese cryptocurrency exchange Huobi announced that they are returning to this market. As news is reporting, the company is planning to enter the market with products related to asset management, and not as an exchanger, as the company initially failed to fulfill US regulatory requirements.

Colorado Governor Jared Polis stated that the state government is currently making plans to start accepting crypto currencies for tax payments. The volatility of the crypto currencies will be addressed by immediate switch of cryptos to US dollars and no cryptos will be held on state accounts.

Largest crypto exchangers in the world like Kraken, Binance and Coinbase are united in opinion that they will not cease their operations from Russia, except in case that they are officially required to do so. For the moment, sanctions against certain individuals in Russia imposed by the US would require these exchangers to comply with restrictions on a certain number of accounts.

Metaverse is strongly moving further into incorporation into more businesses. Latest news is related to the US drugstore chain CVS, who is preparing to enter the Metaverse, by offering consumer goods and prescription drugs to be used in the virtual rooms. CVS will be one of the first drugstores to enter into the entertainment industry in order to offer its products through Metaverse.  

Crypto market cap

Regardless of geopolitical tensions, crypto market had relatively good previous week, moving in a green zone, however, it ended week relatively flat compared to a week before. Analysts are noting that week-end runoff was due to fears from potential nuclear plant explosions in Eastern Europe, however, this info cannot be fully confirmed at this moment. Total crypto market capitalization is finishing week 2% lower from the week before at level of $1.72 trillion. Major contributors to this modest drop are Ether and majority of other altcoins. Daily trading volumes were ranging between $180B down to $140B on a daily basis. Total outflow of the funds since the beginning of this year stands at 21% or $457B.

Although the previous week started in a positive mode, the majority of coins lost this sentiment as of the weekend, leading to a relatively flat trading week. Bitcoin erased earnings from the beginning of this week, ending it with a modest decrease of $3B or 0.4%. Highest loss was with Ether, who managed to decrease its market cap by 4% or $14B. Other altcoins ended a week with a modest loss. Stellar`s market cap was down by 10%, however, the coin also decreased its coins in circulation by 1.5% on a weekly basis. Algorand has also decreased its market cap by 10%. On the other hand, there were few altcoins which managed to end the week in a green zone, like NEO with an increase of 3.3%, or ZCash with an increase of some 4% compared to the week before.

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

Crypto futures market

Crypto futures market was traded in a mixed mode during the previous week. In line with the spot market, BTC futures were traded higher for all maturities, revealing investors optimism regarding futures prices of this coin. BTC future price for maturity in December this year was traded around $41K, which was higher from $40K traded a week before. BTC reached the price of $45K for maturities in December 2023. At the same time, ETH futures were traded lower, where the highest drop was for shorter maturities of some 6%.

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

Bitcoin: is the battle for $45K over?

Market fundamentals are led by geopolitics within the last three weeks. Still, the crypto market is showing some resilience, expressing investors' sentiment that they are still waiting for some positive signals which would allow them to set the course toward riskier assets. This was a situation during the previous week, where BTC had a good start of the week, moving up to the resistance line at $45K. However, during the weekend, price returned to the level of current support at $40K. At this moment, the coin is traded modestly below this level, testing it to the downside.

Moving average of 50 days is continuing to slow down divergence from its 200-days counterpart, second week in a row. This might lead to a positive signal over potential reversal in indicator`s trend and its move to the upside. However, it will take some time until such a move is confirmed on charts. In line with market sentiment, RSI also made a move in a mixed mode. At the beginning of the week, the indicator reached level of 60, indicating that it might make a move toward the overbought market, however, as of the weekend it returned down to level of 45, confirming that the overbought market is still on hold for BTC.

Risks on financial markets are still quite strong. This will support volatility of the crypto market in the weeks to come. It could also swiftly change signals coming from technical indicators, so some precaution is advised. At this moment charts are showing that BTC will start a new week testing support line at $40K. In case that this line is broken on the downside, BTC`s next target will be $37K down to $35K support line. At the same time, there is currently the same probability that the coin might head toward $45K, but with decreased chance to break this line. Certainly, fundamental news will continue to define moves of the BTC in the week to come.

Ether: probability for a move above $3K is reduced

Although ETH is still holding, based on previous coin moves, it seems like investors are putting more confidence in BTC during the times of general market instability. Third week in a row ETH was struggling to break the psychological line at $3K. Market just doesn't have strength for this move at this moment. This adds to the decreased probability for ETH to break $3K resistance in the coming period. Weekly high-low spread for ETH was $2.550 - $3.040. Coin is ending a week trading above $2.6K.

Although the moving average of 50 days slowed down a bit its divergence from MA200 two weeks ago, during the previous week this divergence continued. This is another signal in support of decreased probability for break of $3K line. RSI went modestly above 50, however, soon reverted down to 42, indicating that it is still too early to expect a move toward the overbought market.

For the last two weeks the support line at $2.630K was holding strongly, however, with continuous market pressure. ETH is finishing the week around this level. This pressure is expected to continue at the beginning of next week. In case of negative fundamental news, this line might be broken to the down side, when ETH will seek the next support line at $2.4K. In case that $2.6K holds, then ETH will revert again toward $2.8K and potentially to $3K to test it once again, but with decreased probability that this line can be broken to the upside.

Ripple: signals are mixed

During the previous week XRP has slowed down its volatility. Coin started a week from the $0.7 support line and made a move toward $0.8, however, it did not manage to make a break toward the $0.85 resistance line. Instead, the coin reverted back to $0.7 support as of the weekend.

RSI was moving around the line of 50 not providing much indication regarding potential future reversals of the trend. Moving averages of 50 days are continuing their convergence slowdown, which is to some extent a positive technical sign, indicating probability that XRP might hold to these levels for some time. However, it is still too early to speak about the timing of the start of their convergence trend.

Current signals are mixed for XRP. On a positive side is that $0.7 support is still holding and based on technical analysis there is strength for this level to be sustained in the coming period. Still, as with other coins on the market, fundamentals will play a crucial role for coins' future price. In this case XRP might make a move toward the next support line at $0.65. On the other hand, if $0.7 sustain pressures, the coin might revert back to $0.8, potentially to $0.85 resistance line to test it for the first time in three weeks.  

Binance Coin: slowdown continues

It is not quite usual for BNB to slow its volatility, but it has occurred on several occasions since the beginning of this year. During the previous week, the coin once again slowed down, moving in a range from $355 up to $420, which was the highest level reached during the week. It is also interesting to note that even during increased optimism at the beginning of the previous week BNB did not make any significant move, rather it was moving slowly but gradually toward the week`s peak price.

For the third week in a row MA50 is continuing to diverge from MA200, while indicators still dont show any sign of a potential slowdown in the coming period. This, to some extent, adds to the probability that the price of BNB might go lower from current levels, still, the support line at $350 was holding strongly in the past few weeks. RSI is moving around level of 50, currently not providing any indication on potential next move of the coin.

It is positive for BNB that $350 was holding during the previous period, which adds to the probability that this level might sustain current pressure. However, in case that low investors interest or negative fundamentals push the price to the lower grounds, then BNB might make a move toward the next support line at $300. On the opposite side, there is a probability that the coin will head to test $420 resistance for one more time in the coming period.

Cardano (ADA):  can go lower from here?

ADA`s free downfall is continuing, regardless of general market developments. There is currently not much information available in order to understand what is continuously pushing the price to the downside. From charts, it looks like investors' initial optimism about this coin is fading away, which does not put too much positive prospectus for ADA. During the previous week, ADA made a modest move from level of $0.85 up to $1.0 resistance after the coin reverted back to the beginning level.

Moving averages still don’t look too optimistic. For the last month, the moving average of 50 days is strongly converging from MA200, without any sign of slowdown in this trend. At the same time, RSI made a slow move toward 47 and swiftly returned down to 35. Oversold market has not been reached, but current RSI movements are indicating that this might occur, if the price continues with its fall.

Current technical analysis prospectus for ADA is not too optimistic. There is some probability that the coin might try to test the resistance line at $1.0 one more time in the coming period. However, there is still no confirmation on a potential that this level might be breached. Pressures to the downside are consistent, which increases probability for ADA to make a move toward the next support line at $0.7.

LINK: charts are not optimistic

LINK spent another week in a slow motion mood, with increasing pressures to the downside in motion. Coin started a week modestly above the support line at $13 and made a move toward its highest weekly level at $15.8, after which, it reverted back to the support line at $13. Coin is currently trading around $14.

During the week RSI was moving between levels of 40 and 47, but it did not manage to reach 50 lines. It adds to the probability that it might take some time until the coin sets the stage toward the overbought market. Moving average of 50 days is still strongly diverging from MA200 counterpart, without any sign of potential slowdown.

Current charts are not at all optimistic. If we add to it potential negative fundamentals, it increases probability for LINK`s next move toward the support line at $13 which might be clearly tested in the coming days. A break of it would lead LINK toward a long term support line at $8. On the opposite side, there is some probability that resistance at $15 might be tested one more time.

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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