Last week in the news

Inflation is again in the spotlight of the market, in line with geopolitical risks. During the previous week markets were traded in a mixed mode, impacted mostly by release of latest figures of the US and EU inflation figures, as well as by Fed's decision that US interest rates will be higher. Bitcoin is already $41K, while Ether is trying to hold at $2.7K.

Powell noted the previous week that inflation pressures and market make it appropriate to hike rates at this moment, and tighten US monetary policy.  End of the week brought US inflation figures for February of 7,9%. Inflation continues to surge supported with rising energy and food prices. At the same time ECB announced that it will end its asset purchases program sooner than expected amid fears of potential stagflation, currently without change in interest rates. Inflation in the EU zone remained at a high level of 5.8% in February.

The US administration revealed on Wednesday executive order on cryptos, which is providing a unified approach for regulating these assets. Aim of these regulations is to instruct government agencies to bring a unified approach aimed to address risks coming from crypto assets. This order brought some relief to the crypto community in terms that crypto currencies will certainly not be banned in the US, while on the other side there were concerns over the lack of clarity.

Block (SQ), formerly Square, announced that it is building a bitcoin wallet with enabled fingertip sensors which will be used to unlock the wallet. This wallet based on hardware will be charged through lithium batteries chargeable through USB port.

Crypto market cap

Surging inflation in both the US and EU has been in the spotlight of the investors during the previous week, aside from ongoing geopolitical risks. Financial markets were traded in a mixed mode, including the crypto market. Total market capitalization during the week reached $1.8 trillion, however, the week ended at a level of $1.71 trillion. This represents a decrease of 1% compared to the week before, where the crypto market lost another $12B. Daily trading volumes were modestly decreased from a week before, ranging from $140B up to $155B on a daily basis. Total outflow of the funds since the beginning of this year stands at 21% or $469B.

Weekly changes in crypto market capitalization were mostly influenced by altcoins, rather than major coins on the market. Bitcoin and Binance coin finished the week flat. Ether continues to lose strength with the latest decrease in market cap of almost $8B or 2.5% on a weekly basis. On the opposite side was XRP with a surge in market cap of $2B or 6%, followed by Polkadot, which increased market cap by $1.6B or almost 10% in a single week. There are few coins which managed to sustain a relatively flat market cap, despite decrease in price, through increase in coins in circulation. Some of these altcoins are Filecoin, with a surge by 1.9% in circulating supply, and Zcash with an increase of 0.4%. During the previous week Tether for the first time reached a market cap of $80B.

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

Crypto futures market

There have not been many changes on the crypto futures market during the previous week. Bitcoin short term futures were down by some 2% on average, which was in line with the spot market as of the end of the week. Longer maturities remained relatively flat compared to the week before, with December 2022 still holding slightly above $41K. Situation with ETH futures was slightly different, where all maturities were down mostly by 1% from the week before, except March and April this year, which dropped by some 3% in line with spot market developments.

Bitcoin: weight of external factors continues

It seems like investors are slowing down a bit in order to weigh other factors which might have influence on the crypto market in the future, like, current state of world major economies and their prospectus for the future period taking into account geopolitical risks. BTC started the previous week with a strong push to the upside, reaching level of $42.6K, however, news on surging inflation in the US and forthcoming FED rate increase did not have a positive impact on coin, so it ended the week modestly below the $40K support line. After Fed's decision Bitcoin went to $41$K.

The level at $40K is holding for the last three weeks, regardless of the continuing pressures to the downside. On a positive side are also decreased trading volumes during the week, which were unable to push the coin below its current support line.

Chart analysis for BTC still requires a level of precaution, since fundamentals continue to be strong and shape investors sentiment. BTC is starting a new week by testing a $45K resistance line. Whether this line will manage to hold in the coming period will depend solely from positive or negative fundamentals. BTC is going to test $43K one more time, with some probability that the resistance line at $45K can be tested.

Ether: are bulls eyeing $3K?

During the previous week ETH indeed tried hard to get back on the previous track, but $3K is passé for this moment. Fundamentals have turned investors to hold their positions until current risks are fully weighted. That means that re-positioning is still to come in the crypto market. Until then, it seems that ETH will be on hold, while those who are still buying the dip, are unable to push the price to the higher grounds. So, it seems that it will take some time until ETH heads again toward the $3K psychological line.

It is still too early to speak about the final change of the course for this indicator, but still the slowdown marks potential the end of the current trend.

In case that there is no such news, then ETH might head once again toward $2.630, eventually try to reach $2.850 one more time.  

Ripple: are mega-whales in a game again?

Few weeks ago there was news regarding XRP, that so-called “mega-whales” are on the move again on the market and that they had accumulated $700 million in the last three months. Although this information cannot be fully confirmed through available data, still charts might provide some support for this, through XRP`s market moves against general crypto market trend. The question is if the mage-whales are in the game again or some sort of inside info trading?

XRP found a support line at MA50, which started its modest convergence toward its MA200 counterpart. Although this is a positive sign which might indicate that a cross is coming.

Current analysis should be taken with precaution, considering that there might be some elements outside of the pure technical analysis which might influence future price of XRP, and which are unknown at this moment. Technical analysis is suggesting that XRP will continue to test the current resistance line at $0.85.

Binance Coin: slowdown indicates a coming break

Slow-motion moves are not characteristic of BNB, but still for the last month BNB has significantly decreased its volatility. During this period of time, the coin was moving in a range between levels around $400 and $360, which is the support line that was holding strongly during this period of time. However, in technical analysis, when a coin is slowing its daily moves, it is usually a signal that the final break to one side is coming.

Technical analysis is suggesting that pressure on the $393 line will continue in the coming days. There is some probability for $400 to be tested again, with a decreased probability that the coin might test $420 resistance.

Cardano (ADA):  moving to $1

Good news for ADA is that the coin managed to sustain a $0.8 support line during the previous week. Bad news is that it indicates a significantly decreased market interest for this coin in the last few weeks.

Based on current charts, there is also some probability that $1 might be tested on one more occasion, but it does not seem that the coin will have strength for a move above this line.

LINK: Is there strength to reach $15 level?

Positive for this coin is that the support line at $13 continues to hold strongly for the last three weeks. So The coin probably can reach the $15 level.

The coin will certainly head toward $14, eventually $15 resistance line. However, in case that $13 is broken to the downside, it would mean LINK`s move toward the $8 long term support line.


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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