Last week in the news
Previous week market was driven by investors' concerns over the surging number of infections with new virus and its impact on the economy as well as the FED's meeting scheduled for next week. Major U.S. indicators finished the week in red. Crypto market traded relatively flat, although major cryptos gained during the previous week. BTC and ETH are ending the week around 6% higher from a week before.
The Central Bank of China aims to make the Yuan more international. As per the Central Bank statement there is an effort of China monetary officials to promote internationalisation of their local currency “steadily and prudently”. Cross border settlements in Yuan are continuously increasing, while only during last year this increase reached 46% on a yearly basis. Aim of this internationalisation is to decrease its reliance on the U.S. Dollar. It has not been noted if digital Yuan, which CB of China is already testing, would further support CB`s internationalisation efforts.
Bloomberg reported on Friday that potential insider trading and market manipulation at Binance Holding Ltd. is currently investigated by the U.S. officials. As per people involved in a matter, the investigators from the U.S. Commodity Futures Trading Commission are reaching some people which might be involved in order to investigate potential breach of the Law. Binance Ltd issued a statement that the company follows a “zero tolerance” policy when it comes to inside trading.
Ripple, a global payment company, is planning to make a breakthrough on the market by building a crypto market-making platform for its token XRP, with the aim to provide liquidity for XRP. As of December last year the company and XRP has been strongly hit by the news that SEC has initiated a lawsuit against several key persons in Ripple due to offering of unregistered securities by issuing XRP token, which has not been in line with the U.S. Securities Law. This legal case still has not been settled.
El Salvador's President Nayib Bukele tweeted that almost 95% of bugs found in the country`s Chivo Bitcoin app are fixed, noting that the local wallet was a huge success as it already has more than 500 thousand users, which is 8% of the country's population. There are also 200 operating ATM`s in El Salvador and 50 in the U.S. supporting Chivo BTC wallets. Bukele also announced new stimulus for businesses in the country which will accept BTC.
As per news reports, the Biden administration is planning to strengthen current anti-money laundering and terrorist financing regulations through inclusion of provisions related to digital currency ransomware attacks and related payments.
Elon Musk again supported the price of DOGE by tweeting a picture of his shiba-inu puppy with a note “Floki has arrived”. Although initial market reaction was in support of DOGE price, still, the coin continued to trade in a mixed manner during the course of the week.
Crypto market cap
During the previous week, most investors' concerns were related to the surging number of infections with new virus and its impact on the economy, as well as FED's meeting which is scheduled for next week. Expectation on FED's tapering of bond purchases has pushed the USD up, however, the equity market finished the week in red. Crypto market was almost flat for majority of altcoins, while BTC and ETH were traded at relatively higher grounds. Total crypto market capitalization was increased by 4% on a weekly basis, reaching $2.17 trillion. Daily trading volumes has been decreased to levels of $160B up to $200B on a daily basis. Total inflow from the beginning of this year stands at $1.38 trillion, which is an increase of 174%.
Previous week was a flat week for the majority of altcoins, while the market was driven by major cryptos. Bitcoin gained more than 6% in market cap on a weekly basis, or some $56B, followed by Ethereum whose market capitalization surged by almost 6% or $23B. On the other side, Bitcoin Cash and Theta finished week in red, with decrease of 4% and 3% respectfully. Circulating supply of several altcoins has been increased, among which are Ethereum Classic and ZCash with an additional 0.4% of circulating coins.
The table below provides most recent information regarding market cap and circulating supply for most popular crypto currencies.
Crypto futures market
During the previous week there has been modest improvement on the crypto futures market, in line with the BTC and ETH spot market.
BTC futures maturing until the end of this year have gained some 4% in value, still trading at values modestly below $48K. Positive move is made for futures maturing as of the end of 2022 as BTC price has reached levels slightly above $50K.
ETH futures also made a positive move, however price of futures are slower reaching higher grounds. Futures with shorter maturities were increased by some 3%, while those maturing at December 2022 are still traded below $4K level.
Table below provides the most recent information on BTC and ETH future prices.
Bitcoin: targeting $50K one more time ?
During the previous focus of investors was switched again to major cryptos which are BTC and ETH. Bitcoin started a week at level above the support line at $45K and headed toward next resistance at $50K, however, this level has not been tested. Instead, BTC stopped at short term resistance at $48K, where it is currently traded. RSI was continuously moving around level of 50 not indicating potential reversal. It is interesting that oscillators made a cross where MA50 crossed MA200 from down side. This is an indication of potential for an uptrend, however, it needs to be confirmed within the next couple of days.
Current charts are showing that there is strong potential for a resistance line at $50K to be tested once again. If it is broken, it might expect for BTC to head toward next short term resistance at $53K where BTC was at the beginning of September. This level would be one strongly to watch, as it will mark a significant point where BTC will either move to the higher ground, or it will mark a certain reversal point to the downside to the level of $40K. As per current charts, this risk remains.
Currently there is an increased probability that BTC will try to test $50K resistance once again in the coming days. In case that this level is broken, then level to watch would be $53K and $55K as strong resistance. In case that current $48K holds, then BTC will revert a bit on a downside in order to test support at $45K once again.
Ether: how far is $4K?
It was a relatively positive week for ETH. After a modest reversal down to level of $3K, during the previous week, ETH pushed to the upside, reaching again levels above $3.6K. ETH is finishing week at levels above $3.3K. Oscillators are continuing to diverge from each other for the last few weeks. For the second week in a row, ETH continues to find support at 50-days moving average line. RSI is still moving around 50.
Current chart is suggesting that the resistance line at $3.5K will be in focus in the following days, for the second week in a row. If it is clearly broken, there is high probability that ETH will continue toward next short term resistance at $4K, with some short term stops around $3.7K. On the other side, if there is no market strength to push ETH further to the up side, then coin will continue its volatility around $3.5K, down to $3.1K which would be short term stop for ETH and also break of MA50 support line.
Ripple: high pressure on $1.0 support line
Although the previous week was another flat week for XRP, there has been some quite interesting news from Ripple. News reported that the issuer of XRP is planning to build a crypto market-making platform for XRP tokens in order to provide liquidity for this coin. The issue here is that after the SEC pressed charges against Ripple officials, many platforms have banned this coin, making it less marketable one. With this move a company is trying to bring XRP back in the market game. Certainly, this would be one of the topics to be followed in the coming period, as higher liquidity makes currencies more attractive to investors. Still, it should be considered that the SEC lawsuit is still unsettled, so some legal risks for XRP are still remaining.
During the previous week XRP continued to trade in a relatively slower motion, between levels of $1.12 and support line at $1.0. Currently there is strong pressure on $1.0, but XRP is still continuing to find support at the MA50 line. Daily trading volumes continue to decrease, which raises a question for how long a support line at $1.0 can hold?
Support line at $1.0 is to watch in the coming days. In case that market pushes the coin further to the downside, it increases the probability that XRP will head toward long term support at $0.9. In case that current support is not broken, there is some probability that XRP might try to test the next resistance at $1.2.
Binance Coin: $380 support is still holding
During the last two weeks, the price of BNB slowed down a bit, after steady and continuous uptrend which started in July this year. For the last two weeks BNB is moving between $430 resistance and $380 support. Coin ended this week above $400 level, but still continuing to find support at the 200-days moving average line. RSI is moving around 40, but still without indication of an oversold market.
Current charts are suggesting that there is an increased probability for the support line at $380 to be tested again, so this will be the level to watch in the coming days. In case that it is broken, the next level to watch would be $350. However, if it is not broken, BNB will revert to the upside till the level of the current resistance at $430.
Cardano (ADA): short term correction after record score
Alonzo hard fork has been successfully implemented as of September 12th, enabling Cardano`s blockchain path to DeFi`s. However, during the previous week ADA` price was moving between $2.30 and $2.80 levels, without even trying to reach the new ATH. Such market behaviour might provide some indication that previous price push might include some elements of speculative trading, however, without a certain proof. Nevertheless, a rise of almost 200% within two months is certainly an impressive score for ADA.
During the previous week RSI was moving around level of 40. Oversold market has not been reached. Oscillators are continuing to diverge from each other, but ADA is still finding support at MA50 line. Based on relatively short historical data, some levels are emerging as important lines for this coin. Current support line stands at $2.30 which has been tested during the last two weeks. This would also be a level to watch in the coming days. In case that it is broken on the downside, then ADA might head toward levels of $2.10, down to $2.0. A move to the opposite side increases probability to push the price at least to the level of $2.60.
LINK: is the break of the channel coming?
Although LINK started a week around level of $26, the coin headed on the upside in order to test the resistance line at $30, reaching its highest weekly level at $31. Strong resistance has not been broken one more time, so LINK headed back to the strong support line at $25, finishing week modestly above $28 level. RSI continues to move around 50, while oscillators are continuing their convergence toward each other. If this is going to be a signal that LINK is getting ready to break the $25 - $30 channel, we are going to see in the coming days.
For the moment, support and resistance lines at $25 and $30 are continuing to be in focus. In case that resistance is broken, the next level to watch would be $35. On the opposite side, a break of $25 support would push LINK down to next support at $20.
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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