Last week in the news
During the second trading week in a year, the crypto market managed to recover some losses, reaching levels modestly lower from the end of the previous year. Bitcoin is finishing the week above $43K, while Ether is holding around $3,3K.
Elon Musk started the year with new tweets supporting Dogecoin. Namely, he announced that some of Tesla`s products are “buyable” with Dogecoin. This refers to some cheaper goods like belt buckles or whistle shaped like Tesla`s cars. For the moment, vehicles cannot be purchased with crypto coins. After the announcement, Dogecoin surged by more than 15% on Friday.
At Crypto Finance Conference held in St. Moritz in Switzerland, venture capitalist Bill Tai told CNBC that many assets will be turned into NFT`s in the future, including “company stocks and real estate”. He also noted that he is certain that this will happen as the internet moves from Web 2.0 to Web 3.0.
A non-profit organization in Arkansas, Northwest Arkansas Council, is supporting the tech sector in this US state by offering up to $10.000 in Bitcoin to remote tech professionals to relocate to Arkansas. Their incentive to tech professionals is part of campaign “Life Works Here” which is funded by Walton Family Foundation, and is currently available only for US citizens or those eligible for work in the US.
According to a LinkedIn study, there has been a significant increase of 395% of job-postings related to the crypto business, during last year. Rise in job postings is not only related to software professionals, but also for positions related to finance and consulting in the crypto industry. San Francisco, Austin, New York and Miami are one of the cities in the US with most such job offers.
As CoinDesk is reporting, Bank of America analysts noted that Solana has a potential to significantly impact market share of Ethereum over the time, considering its level of decentralization, security and lower costs of transactions. They called it a “Visa of the digital asset ecosystem”.
Crypto market cap
During the second trading week in a year, the crypto market managed to recover some losses, reaching levels modestly below from the end of the previous year. Total crypto market capitalization has been increased by 6% on a weekly basis, moving once again above $2 trillion. Daily trading volumes were relatively flat, moving around $130B on a daily basis. Total decrease in market cap value from the end of Y2021 was $108B or 5%.
Some of the losses that the majority of crypto currencies incurred during the first week of January have been recovered during the second trading week. Increase in total market cap was led by the major currencies, Bitcoin, with gain of 3% or $27B, followed by Ether, which gained $18B or almost 5%. Other popular coins also had good performance. Binance Coin was up by 10% on a weekly basis, gaining additional almost $8B. DOGE was supported by the tweet from Elon Musk, announcing that Tesla will accept some of their products to be purchased with this coin, gaining 20% in a single week, or $4B in the market cap. Significant gainers were also Polkadot and Polygon with gains of 9% and 15% respectively. Polygon also increased its coins in circulation by 2.1%, followed by Solana, with an increase of 0.9%.
The table below provides most recent information regarding market cap and circulating supply for most popular crypto currencies.
Crypto futures market
Crypto futures market ended the previous week in a mixed mode. Short term maturities were following developments on the spot market, due, BTC futures with maturities until April 2022 were up around 3%, while ETH futures for same maturity surged around 4% on a weekly basis. Still, prices of futures with longer maturities have decreased by 10% for BTC futures and 13% for ETH futures. Maturities in December 2022 are still holding at $45K for BTC, while for ETH they have dropped to $3.4K.
Table below provides the most recent information on BTC and ETH future prices.
Bitcoin: oscillators don’t look quite optimistic
Second trading week of this year has been positive for the crypto market and Bitcoin. Some of the losses which have been incurred during the first week have been modestly recovered during the previous week. Bitcoin started the previous week testing support line at $40K. However, there has not been market strength to break this line to the downside, and BTC reverted to the upside and toward resistance line at $45K. Still this level has not been tested during the week; instead, BTC made a short break around the $43K level. BTC has ended the week modestly above $43K.
Although BTC`s price moves from the previous week look promising, technical indicators might spoil initial optimism. As of the end of the previous week MA50 has made a cross with its MA200 counterpart from the upside. In technical analysis, this implies an increased probability for further downtrend for this coin. It might be too early to jump into conclusion, considering that it will take a few days until cross confirms itself on charts. Still, the risk stands at this moment. RSI has moved from the oversold market to the upside, currently moving around 40. At this level the indicator is not adding to the probability for some major reversal of the BTC.
Level in the spotlight during the next few days would be the $45K resistance line. Since it has not been clearly tested during the previous week, it increases the probability that BTC will test this level in the coming days. In case that there is no market strength to break it, there is a high probability that BTC will revert once again back to $40K support line. On the other hand, a break of $45K would push BTC toward a short term resistance line at $48K, but based on current charts, there is low probability for such a move.
Ether: $3K is resisting pressure
During the previous week the $3K support line resisted the market pressure, which started a week before. Minimum level reached during the week was $2.940 but only on one occasion, after which, the coin reverted back to the levels above the $3K strong support line. Two weeks ago, ETH reached an oversold market, and the coin entered into a short term price reversal. However, the highest level reached during the week was $3.400, while the $3.500 resistance line has not been clearly tested.
Moving averages of 50 and 200 day are still slowly converging toward each other, but managing to keep a safe distance between them. RSI has moved to the level of 40, not providing much indication over the next course of the coin.
Considering that the resistance line at $3.5K has not been tested during the previous week, it increases the probability for ETH to test it in the coming days. However, the pressure to the downside is still persistent on the charts, which is adding to the probability for ETH to test one more time support line at $3K. For next support line at $2.850 is still too early in time, as there is currently low probability for this level to be reached in the coming few days.
Ripple: $0.8 resistance is still a hard task
First week in January XRP was struggling around the $0.85 resistance line, however, the coin spent the second week struggling around the lower resistance at $0.80. XRP`s starting point during the previous week was the support line at $0.7. Although the coin swiftly went to the opposite side, the resistance line at $0.8 could not be broken, although it has been tested within the last four days. It seems like this level is a hard task for XRP at this moment.
Moving averages of 50 and 200 days are continuing to diverge from each other, confirming a cross that these lines made three weeks ago. This also implies that there will be some continuing pressure on the downside in the coming weeks. RSI is moving around level of 40, not providing much information over the potential reversal in the short period of time.
In the following week it might be expected that XRP will continue to test the $0.80 resistance. There is decreased probability that it will be broken to the upside and that next resistance at $0.85 will be reached. However, based on current charts, there is some potential for a $0.83 level, but very weak at this moment. On the opposite side, in case that $0.8 is not clearly broken, XRP will revert down to $0.75 and potentially $0.7 support lines.
Binance Coin: no space for too much optimism?
After reaching a clear oversold market, the price of BNB reverted to the upside during the previous week. Reversal started at $420 support line and finished the week testing $500 a short term resistance. The $520 historical resistance line for BNB has not been tested during the week. This increases the probability that the current reversal move is still not finished and opens a space for BNB`s price to move higher from this level.
RSI made a move from oversold market to the level of 50. A move above this line in the coming days would provide an indication that BNB will head up until a clear overbought market is reached. A bit concerning factor, in the long run, is that moving averages of 50 and 200 days are continuing to converge toward each other, but still, they are moving at a currently safe distance. Potential cross will depend on the further price moves of the coin.
Based on current charts, the $520 resistance line might be a next target for BNB in the coming days. There is a decreased probability that this line will be broken, in which sense, BNB might revert to the downside to test first $500 short support line, down to $420 for one more time. There is low probability for $420 to be broken on the downside, except in case that fundamentals push the price lower.
Cardano (ADA): only a temporary recovery?
Cardano started the previous week shortly testing the support line at $1.0, however, as expected, the coin swiftly reverted back till the level of $1.30, and broke the resistance line at $1.20. This move was clearly indicated by the technical analysis; however, optimism for sort of longer trend reversal should be taken with precaution.
Since last week, moving averages of 50 and 200 days are slowing down their convergence from each other, which might put some positive influx into potential for their cross in the future. Still, it is too early to make such conclusions. RSI has not made a clear oversold market signal, instead, it moved to the level of 50, but without clear indication that it is heading toward an overbought market.
At this moment, signals from technical analysis are a bit mixed for ADA. Support line at $1.20 will stay in the market focus for the next few days. There is a high probability that this level will be tested once again in the coming days. On the other hand, the historical resistance line at $1.35 has not been clearly tested during the previous week, which adds to probability for a move toward $1.35 before short term reversal toward $1.20 level for one more time.
LINK: how strong is $25 support?
First week of January was a good one for LINK, as the coin managed to move away from the general bearish crypto market and increase its value by almost 30%. During the previous week LINK was still holding to this short term trend, and reached weekly high at $28,6. Still, for the second week in a row, the resistance line at $30 has not been tested. Instead, pressure was more on the $25 support line.
With the latest move, RSI was pushed further to the level very close to the overbought market, to the level of 68. Although, clear overbought market has not been reached in this turn, the coin reverted a bit as of the end of the week, pushing RSI down to 55.
Charts are currently suggesting that market pressure on the $25 support line will continue in the coming few days. There is a decreased probability that this level might be broken on the down side, decreasing the probability for the next support line at $20. On the opposite side, higher probability stands at the $30 resistance line, which coin did not manage to test the previous week, with a short stop around $28 level.
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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