Last week in the news
Regardless of some quite positive news coming from Elon Musk on accepting BTC as a payment mean for Tesla cars, still the gainer of the previous week was US equities after weak US inflation data. On Thursday, Dow Jones Industrial increased by more than 200 points, followed with S&P with 0.8% and Nasdaq with 0.2%. At the same time, BTC lost some of its value, reaching $50K, but reverted back the next day.
The US inflation figures were published during the previous week. Core PCE was 0.1% on a monthly basis, while it was 1.4% on a yearly basis. Last trading of 10Y US stocks was at level of 1.65%. Low inflation figures and potential opening of the economy due to ongoing vaccination, boosted investors confidence. All major US indices strongly gained during the previous week.
Elon Musk made it official on Twitter that customers will be able to buy Tesla cars using Bitcoin for this purpose. Currently this option is available only for US citizens, but later this year it would also be available for customers outside the US. Tesla would use internal software for this purpose and it will not be transferred into fiat currencies, Musk noted. This differs from current practice of some other companies that accept BTC as a means of payment for products and services, as they were transferring their coins into fiat currencies without holding any of coins on their balances.
SkyBridge Capital has filled with the Securities and Exchange Commission for a bitcoin exchange traded fund. These operations will be conducted together with First Trust Advisors, as per reported news. New fund called First Trust SkyBridge Bitcoin ETF Trust will invest solely into bitcoin, however, SkyBridge still have not issued any statement or comment on filing.
Coindesk reported that US state Kentucky adopted Bill 255 “Incentives for Energy-related Business”, through which significant incentives are provided to crypto miners with minimum invested capital of $1 million, including tax breaks. In our previous weekly reviews we have reported that China is planning a ban on crypto mining in its effort to decrease use of electricity in its environmental-friendly initiative. There is also unconfirmed news that the Government of India is also planning to ban all crypto currencies and businesses related to it. In the wake of such news, Kentucky Incentive program can be treated as a refreshment in a crypto business world and potential safe-haven for crypto businesses from China and India.
Crypto market cap
Crypto market capitalization has been modestly decreased during the previous week. As of the end of week, capitalization was standing at $1.7 trillion, which is a decrease of 5.3% from $1.8 trillion from a week before. Currencies which were driving this decrease were Bitcoin with loss of $73 billion in capitalization and Ethereum with loss of $15 billion on a weekly basis. There has not been any significant change in volume of daily trades from a week before, which were ranging from $200B up to $250 billion on a daily basis. Total cash inflow from the beginning of this year is $911B which is an increase of 115% in relative terms.
Although the majority of coins were in red during the previous week when it comes to market capitalization, Theta and Ripple had a very good week. Theta had reached a new record high which increased capitalization for this coin to levels of $11B, which was an increase of $3.5B on a weekly basis. Ripple managed to gain additional $2.6B during the previous week. Currencies with significant decrease in market cap were Bitcoin, with loss of some $73B or 6.8%, followed by Ethereum whose market cap was decreased by $15.5B or 7.8%. Litecoin was also down by 10% and LINK with 13%.
The table below provides most recent information regarding market cap and circulating supply for most popular crypto currencies.
BTC short term price correction
It was another volatile week for Bitcoin. Increased investors confidence due to data on low inflation pressures in the US, have turned investors' interest to US equities. However, there was some good news for BTC tweeted by Tesla`s founder Elon Musk. Namely, as he was mentioning this possibility from the start of this year, it has been now made official that Tesla`s customers can now buy their favourite cars paying for it in Bitcoin.
BTC ended the week before testing resistance level of $60K. As the market did not have enough strength to break this level, currency reverted down touching support level at $50K. BTC ended the week at levels of $55K where current short term resistance stands. Clear break of this resistance would lead BTC to test once again a level of $58K and $60K. RSI is currently moving around 50, which does not provide a clear clue in support of potential break of $55K level. In case that level of $55K is not broken, it opens a path for BTC to test once again a level of $50K.
ETH next short term target at $1.850?
During the previous week ETH tested resistance of $1.850, but without success to break it, currency reverted to test short term support level at $1.550, previously clearly breaking support at $1.650. For the last three weeks RSI is moving around level of 50, which does not indicate that there might be some trend indication on ETH`s price. ETH is currently traded around a level of $1.700. Next resistance stands at $1.750. In case that currency manages to break this level, the next significant level stands at $1.850 before the psychological level of $2K. In case that there is reversal on the opposite side, support levels are standing at $1.650, $1.550 down to $1.400 which is a significant support line and 0.618 FIBO.
Ripple`s next target at $0.6?
Since last week Ripple is finally out of slow volatility mode. Coin managed to push price to the level of $0.6, but soon reverted back to test quite strong support at $0.45. It is currently trading around level of $0.57, slightly above resistance at $0.55. RSI is currently moving around 60, which indicates that the market is modestly moving toward the overbought zone, but it is still not there. This provides some potential that level of $0.6 might be tested once again in the next short term. In case that this resistance is broken, Ripple might test the next significant level at $0.63 and above to $0.7. On the opposite side, short term support levels to watch are at $0.5, and below $0.45, $0.37 and $0.30.
What’s in store for altcoins
Third week in a row Theta has an amazing performance. Theta started March at levels around $3 and finishing month by reaching incredible $15. In relative terms, this is an increase of 400% during only one month or 476% since the beginning of this year. Unfortunately there is still no official information who is the major buyer of this coin, in which sense, any surprise with relation to price in the future period might be expected. New ATH has been reached on March 24th at level of $15. Coin has reverted a bit down to level of $11 where it is currently trading. Since the beginning of March, RSI is moving in a clear overbought zone. Application of technical analysis with such strong moves as Theta had during the last three weeks, might provide some misleading conclusions. Without also available fundamental data, we will just mention some potential levels for this coin on the down side at $8 and $6.
Cardano (ADA) is slowing down a bit after a few quite good weeks when the newest ATH at $1.47 has been reached. Coin is currently trading around a level of $1.2 after testing support at $0.9 during the previous week. In case that current resistance at $1.2 is broken, there would be a clear way for levels of $1.4 or $1.47 again. However, in the opposite case, support levels currently stand at $1.14 down to $0.9.
Litecoin managed to reach a clear overbought side during the previous week with RSI moving below 40 at level of $167. It was a clear indication of trend reversal and LTC reverted to the up side and current level of $183. Prior to this move, LTC was testing resistance at $200 for a few days. Clear break of $180 resistance would lead coin to next levels at $200 and $230. In case that coin reverts back from this level, then short term support levels to watch are $155 down to $130.
For some time LINK was testing strong resistance at $30. Without enough strength to break this level, the coin reverted back to support at $25. It is currently trading around $27. Overbought zone has been reached during the previous week, with RSI moving down below levels of 40. Trend reversal was clearly indicated. As the coin is currently testing resistance at $25, a clear break of this level would lead to next resistance at $30 up to $35. On the opposite side, current support level stands at $20 down to $18.
During the previous week DOGE reverted to down side in order to test support at $0.05, after not being able to break resistance at $0.06. Current chart shows that DOGE is back on the road to test $0.06 again. If this level is clearly broken, next resistance stands at $0.07. In case of reversal, levels to watch are $0.05 down to $0.03.
NEO is currently testing resistance at $40. During the previous week there has been some short term trend reversal, with coin reaching level of $37. If the trend from the previous week continues, the next long term support level stands at $30 down to $20. However, if current resistance is broken, then levels to watch would be $45 and $55.
There has been low volatility of Monero (XMR) during the previous week. Coin was moving between levels of $235 down to $203. Resistance level stands at $230 and there is currently some probability that this level might be tested once again. Next resistance levels are at $250 and $270. On the opposite side, support levels stand at $200 down to $170.
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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