Last week in the news
Ethereum`s so-called London Hard Fork upgrade had made a major impact on the price of Ether during the previous week. Due upgrade has been successfully launched, the price of Ether soared to $3K. Bitcoin was traded below $45K.
In an interview to Bloomberg last week, the U.S. Securities and Exchange Commission Chair, Gary Gensler, repeated once again the general stand of U.S. leading regulating bodies on crypto currencies, which is investors protection. Although he has been in the field of crypto for many years, he is much more interested in protection of investors, rather than technology itself. Also, he has mentioned a “49 non-crypto policy reviews” on his to-do list, hence, any timeline on the SEC further moves has not been provided. In line with environmental initiatives in the U.S., special attention of the SEC would be on companies' disclosures of environmental risks.
At the Aspen Security Forum, held last week, the U.S. SEC Chair Gary Gensler agreed with his predecessor in a view that the majority of ICO`s could fall under Securities Law in the U.S., in other words, they could be treated as securities. In this sense and in his view, they should be officially registered as securities and their issuers should comply with the currently in place federal laws.
The CoinJar, one of the oldest crypto exchanger in Australia has announced a launch of the CoinJar Card in cooperation with Mastercard, which will enable its clients to use their digital assets to buy, sell or make purchases from their platform. Payments will be possible in up to 30 crypto currencies. As CoinJar Chief market officer Gluchowski noted, transactions will be processed in Australian dollars through local banks and payment providers.
Investment trust RIT Capital Partners, founded by Jacob Rothschild, is investing further into digital-asset companies by supporting Aspen Digital, an institutional investors platform , with $8.8 million. As a reminder, RIT Capital Partners already acquired an interest in the Kraken company at the beginning of this year.
Stronger than expected job figures in the U.S. have pushed market confidence, pushing U.S. indexes further to the ATH`s. A job report posted on Friday shows that 943.000 jobs were added in July in the U.S., decreasing the unemployment rate to 5.4%, better than market estimated 5.7%. Tech companies didn't gain this time, as investors' expectations are on the side of companies which might better benefit from expected economic growth, like industrials, retailers and energy sectors.
Crypto market cap
General market sentiment has been positively impacted by expectation on after-pandemic recovery of the U.S. economy during the previous week, after released job data. This had a positive effect also on the crypto market, although some of the market focus has been on new updates on Ethereum network, which pushed Ether to higher levels from previous trades. Total crypto market capitalization has been increased by $160B, or 10% on a weekly basis. Although all coins gained second week in the row, Ether was certainly in the spotlight of the market, followed by Bitcoin. Daily trading volumes continued the trend from a week before, moving around $230B on a daily basis. Total inflow from the beginning of this year currently stands at $968 billion, which is an increase of 122%.
Second week in a row crypto market is ending in green, as all coins gained during the previous week. Market was driven by Ether, due to network updates, which pushed the price of coin above $3K, and outperformed Bitcoin. Market capitalization of Ether has been increased by $75B, or 26% on a weekly basis. Bitcoin gained an additional $35B or 4.5%. Some other coins with higher performance were Cardano, with market cap increase of $4.5B or 10% w/w, Dogecoin with additional $3.7B or 13% increase and Binance Coin with surplus of $3.2B or almost 6% on a weekly basis. Tether gained some 0.5% due to increased circulating supply.
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 have not been significant changes in prices of both BTC and ETH futures. Prices were moving in line with the spot market where expectations on future prices are adjusted in accordance with current market moves.
Table below provides the most recent information on BTC and ETH future prices.
Bitcoin: to be or not to be $50K?
Crypto market generally performed well during the previous week, but Bitcoin was not the star of the week, as it usually is. The price has moved from levels around $38K all the way up to $44.7 on Saturday. After a clear break of $40K resistance, a move toward next resistance at $45K was expected. Although this might sound like good news, in terms that BTC might head even to $50K in the coming days, there are several fundamental and technical aspects which need to be considered, and which are pointing to potential opposite moves of the BTC. It should be considered that there are still relatively low daily trading volumes, which might not be able to strongly push the market to the upside. Secondly, there are still risks on the fundamental side, considering potential news on crypto market regulation in the near future, especially in the U.S. Third, technical indicators are still not confirming that BTC is on the clear road to the upside.
Current charts suggest that BTC managed to break the resistance line at $40K and made its move toward next short term resistance at $45K. At the same time, RSI clearly went to the oversold zone, two times during the previous week, while at this moment the indicator is still moving above 70. MA50 is modestly converging toward MA200 from the downside, but there is still a safe distance between two oscillators.
BTC is currently heading to test the resistance line at $45K. In case that this line is broken on the upside, it can be expected that its next target will be at $50K. In case that there is not enough market strength for such a move, BTC will revert to downside, looking for support at $40K. Some probability for $35K stands but with a short stop around $37K.
Ether: too early for $3.5K?
It was a good week for Ethereum, as a new upgrade, EIP 1559, which should improve transparency over mining costs, was successfully implemented. As expected by investors, this upgrade has moved Ether`s price to the upside. During the previous week, Ether had quite good performance with an increase in price of some 26%, reaching levels modestly above $3K. Second success of ETH was outperformance of market leader, Bitcoin. Although some analysts are optimistic that this might lead to a definitive split of correlation between BTC and ETH, it might be too early in time to jump into such conclusions.
A strong push of ETH`s price during the previous week, have moved RSI to level below 80 which is certainly a clear overbought zone. RSI is still moving there, which might suggest that some short term price correction might be expected. During the whole last week both MA50 and MA200 oscillators were moving as one line, due they are currently not providing much information regarding future potential move. Resistance line at $3K is currently tested for the upside, but considering relatively lower trading volumes, it is questionable if the market will have strength to move the price further on the upside.
Current level at $3K is to watch during the next few days. In case that some fundamental news pushes price further, then it could be expected for ETH to move to the next resistance line at $3.5K. In the opposite case, short term price correction might lead the coin down to the support line at $2.850 or down to $2.630.
Ripple: is $0.9 too far?
During the previous week XRP managed clearly to break the important line at $0.7 and push its price up to the level of $0.81. Coin is currently traded around this level.
A clear break of the $0.7 resistance line, which XRP was trying to do for several previous weeks, has opened a path for the coin to move toward the next long term resistance line at $0.9. Some short term stop might be expected around the $0.8 level, based on quite short historical data. RSI is slowly reaching 70, which might be an indication that an oversold market is in store for XRP. In this sense, some short term price correction is to be expected. Oscillators are still moving on a safe distance, without indication that some change in trend is to be expected.
Considering that the next important line for XRP historically stands at $0.9, a current level at $0.8 might be only a short term stop. In this sense, the focused level continues to be $0.7. In case that market finds strength to push price further to the upside, then XRP will certainly manage to test the next resistance line at $0.9. If this is not the case, then focused level again will be $0.7 as a currently strong support line.
Binance Coin: is $350 resistance too strong?
During the previous week Binance Coin was moving in line with the general market trend, but moves on the upside were quite modest. Market moves were looking more like the market is not quite sure if the upside is the correct side. Positive still is that the resistance line at $300 is broken, which puts $350 resistance into the spotlight.
Resistance line at $350 is tested for a second week in a row. Regardless of general market optimism, BNB didn't have strength to break it, which currently puts some light on this level. RSI is moving toward the overbought zone, but it is still below 70, which leaves some space for BNB to go higher from current level. Two weeks ago, MA50 crossed MA200 from the upside, but it is currently modestly converging again toward its opposite line.
In the following days it might be expected that BNB will continue to test $350 resistance. In case that this line is finally broken, BNB will head toward the next important line at level of $380, with a small probability of $430. In case that coin reverts shortly to down side, then support at $300 is to be tested again.
Cardano (ADA): $1,4 resistance is still in focus
Cardano continues to test the resistance line at $1.4, which coin was testing for the last two weeks. Although during the previous week the coin managed to move above this line, reaching $1.5, it is still traded around $1.4 level. Decreased daily trading volumes might be seen as one of the reasons why ADA is still struggling to clearly break the $1.4 line. RSI is close, but still not in the clear overbought zone, adding to the probability that the $1.4 line might be soon clearly broken.
Level $1.4 continues to be in focus. In case ADA finds strength to clearly break it, then the next level to watch will be the $1.6 resistance line. In case that coin reverts a bit from current levels, then it is to be expected that price will touch MA200 line, above current support line at $1.2.
LINK: short term correction is due?
Upside potential continued for LINK for the second week in a row, however, as of the week-end, the coin slowed down a bit and entered into quite a short price reversal. LINK started a week at level of $20 and went up to the level of $26. Interestingly, during the whole week RSI was moving around the 70 level which is an indication of an overbought market.
Charts suggest that some sort term price correction might be expected in the coming days. As the resistance line at $20 was broken during the week, and the coin went to test resistance at $25, it might be expected that these two lines will be in focus in the days to come. So, if LINK manages to break $25 resistance it will head toward the next important line at $30. If this is not the case, then it will move down to $20 to test the support line again.
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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