Last week in the news
After a short term reversal during last weekend, the crypto market swiftly regained strength to the upside reaching levels before reversal. Ether managed to reach new ATH at $2.880, supported with the first digital bond issued through Ethereum blockchain as well as increased investors interest for NFT`s.
The European Investment Bank issued its first digital bond using Ethereum blockchain on April 27th. Sale of 100MEUR of 2Y bond was part of the Banque de France project on central bank digital currencies. As noted in the EIB statement, this bond issuance is promotion of capital market digitalisation which should be beneficial to market participants through decreased costs of transactions and faster settlements. It could be noted that it also represents another support to Ether, who is heading toward gaining dominance over Bitcoin on the crypto market. Significant support comes from underlying blockchain technology which is finding its way to mainstream through projects in several industries and increasing popularity of non-fungible tokens or NFT`s.
The FOMC meeting has been in the spotlight of investors during the previous week, with major interest on inflation prospectus and potential changes in FED interest rates. FED made the decision to continue with its policy of near-zero interest rates while continuing its bond purchase program of $120 billion bonds on a monthly basis. FED also mentioned that there might be inflator pressures which would be only temporarily. Although there are clear signs that the US economy is heating up, FEC Chair Powell noted that it will take some time for “substantial progress”, as current developments are supported by largest in history Government aid measures.
The US President Joe Biden presented to the Senate his American Families Plan on Wednesday. Aim of the Plan is to support American families earning up to $400.000 through various subsidies. Funds will be provided through increased taxes on the 1% of wealthiest. One of the most important changes is related to increased taxes on capital gains, which are proposed to be increased to a level of 39,6%.
The world’s largest crypto currency exchanger, Binance, announced that it will launch a marketplace for NFT`s. This marketplace would allow users to create, buy and sell their non-fungible tokens. As per currently available estimates, NFT market turnover reached $2 billion since the beginning of this year.
As Bloomberg reported, Tether should disclose statements regarding its reserves in USD used to back stablecoin, to the New York Attorney General during May. There is still ongoing dispute if Tether is actually holding enough reserves which could back all coins in circulation. As per the latest available information on coinmarketcap.com total circulating supply of Tether stands at $51,6 billion.
Crypto market cap
After last week's short rally, the crypto market is back on the old bullish road. Total crypto market capitalization increased by more than $300B during the previous week, which is an increase of 20%. It is currently very near the all time highest value of $2.2 billion reached in mid-April this year. Last week the market was driven partially by Bitcoin, while there have been significant contributions from other altcoins like Ethereum and Ripple. Daily trading volumes were relatively stable at levels around $250B on a daily basis.
Total inflow from the beginning of this year is $1,3 trillion which is an increase of 173% in relative terms.
It was gaining week for crypto currencies, as the majority of tokens finished the week in green. List was led by Bitcoin with a total market cap increase of $190B or 21%. BTC was followed by Ether, who gained additional $93B or 39% and Ripple with $25B or 55%.
The table below provides most recent information regarding market cap and circulating supply for most popular crypto currencies.
BTC next target at 60K
After a strong move to the down side a week before, when BTC reached a level of $48K, during last week it managed to gain some strength back, moving up to levels of $58K. Uptrend channel, which started in February this year, was broken on the down side, indicating trend reversal. BTC was testing support at $50K when a clear oversold market has been reached.
Currently, BTC is traded around a level of $58K. Significant support level stands at $60K, which currency might test in the coming days. RSI moved up to 50 which suggests that the current move on the up side might continue in the short future period. In case that BTC manages to make a clear break of current resistance at $60K, it would indicate a move to the levels of $63K and $65K. In case that $60K is not broken, then some short reversal might be expected on the down side, to support levels of $55K down to $50K.
Ethereum new ATH is still to come?
Positive news about increased use of Ethereum blockchain in several industries, have pushed the price of Ether to new highs. During last week’s short term downtrend in the crypto market, Ether was holding confidently above the level of $2K, which is a positive sign that investor’s confidence about this token is quite strong. As of Saturday, ETH managed to reach new ATH at level of $2.880, however, at this moment, there is no final confirmation based on technical analysis that this move on the up side is over at this level. RSI is modestly moving above 70, which might indicate that some reversal might soon come. In case of short term reversal, levels to watch would be $2.600K down to $2.400.
XRP is heading toward double top?
It was a good week for Ripple as token managed to return some of its previous strength. XRP started the week with testing support level at $1 and finished the week slightly below $1.6. RSI is modestly above 60, which indicates that move to the up side might not still be over. Short term resistance stands at $1.60 and if broken, the next level to watch is $1.80. Following resistance is at $2.40. Still, if resistance at $1.80 is not broken on the up side, it would indicate formation of a double top and certain short term trend reversal. A move on the opposite side would push XRP to test support levels at $1.40 down to $1.20.
What’s in store for altcoins
Bitcoin Gold is slowly recovering from the previous week. After reaching its weekly minimum level at $71, BTG modestly moved to next long term resistance at $100, but without strength to break it. This level is also currently tested. If BTG manages to break current resistance, it would indicate move to next resistance at $120. In case that it modestly reverts back to down side, then there is probability for support at $70 to be tested once again.
During the whole week Theta was testing resistance level at $11, where it is still traded. In case that this level is not broken in the next few days, it would be an indication of short term reversal to down side, when Theta might test once again support level at $8. Following support stands at $6. If resistance at $11 is broken on the up side, next level at $13 might be tested.
Cardano (ADA) reverted back to levels of $1.30 during the previous week, where it is still trading. ADA is modestly heading to test short term resistance level at $1.40. In case that in following days the coin manages to break current resistance level, it would push price to next resistance $1.50 and potentially to current ATH at $1.55. In the opposite case, coin will revert to support level at $1.20 down to $1.0.
After testing support at $230, Litecoin reverted strongly to the up side, breaking resistance at $250. It is currently trading around $270, and is still moving in an uptrend channel which started in January this year. Next important level for LTC is long term resistance at $300, which coin might test in the coming days. In case of short term reversal, support level stands at $250 down to $230.
In a late Saturday trading, LINK managed to break resistance level at $35. Coin headed toward next short term resistance at $40. In case that this level is broken in the following days, LINK could easily reach current ATH at $44. Whether it would have strength to go even above this level is about to be seen. In case of short term reversal on down side, important support level from this point stands at $35.
There have been additional tweets from Elon Musk about DOGE. Whether these tweets supported DOGE to head back to levels above $0.35 is unclear, but level of $0.40 should be currently closely watched. RSI is moving around 60 which might provide indication that current up-move is still not over. In case that coin reverts to down side, the important level stands at $0.25.
Last four days NEO was testing support level at $90 without strength to clearly break it. This might be an indication that NEO will head to test long term resistance level at $110. In case of short term reversal, level of $90 might be tested once again, down to $80.
Monero (XMR) was one of rare crypto currencies which have not been affected too much by previous week`s general drop in prices. During the previous week, XMR continued its uptrend which started in February this year, when its price was pushed higher, to levels above $420. If this strong uptrend continues XMR could easily reach its ATH levels at $460 where the coin was last time standing in December 2017. In the opposite direction, levels to watch are $370 down to $330.
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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