Last week in the news
Increased investors optimism has pushed crypto prices higher during the previous week. Bitcoin is heading toward resistance at $50K, while Cardano reached a new ATH supported by the “Alonzo” upgrade.
Coinbase`s CEO Brian Armstrong announced on his Twitter profile that the company is planning to invest $500 million of earned profits into crypto, in which way their current crypto holdings will be increased. Furthermore, the company will invest 10% of their future profits in crypto. As per Armstrong`s words, his expectations are that these investments will increase over time as “crypto economy matures”. This announcement comes a week after Coinbase posted better than expected quarterly revenue results of $2.23 billion, which pushed its share price up by 2.1%. After latest announcement share price of Coinbase rose up 3% on Friday.
After the latest issues with regulatory licences in several countries in the world, Binance exchanger is now facing potential lawsuits from its clients due to major outages. As CNBC reported, during the latest drop on crypto market in May, many investors were unable to make trades and close their positions due to outage which occurred on Binance platform. Due to this, many investors suffered substantial losses, hence, they will now try to compensate some of lost funds through lawsuit against Binance exchanger. It is interesting that this is not first outage that Binance experienced. There has been few others during last few years, all of which occurred during the time of high volatility on crypto market. It is expected for at least 1.000 Binance customers to press charges against the company, however, since the Binance has no official headquarters, it makes a bit difficult to determine which court should be in charge for this case. This represents another issue when dealing with highly unregulated market and industry.
Vienna based crypto broker Bitpanda has entered into a deal with Valar Ventures, lead by the U.S. tech billionaire Peter Thiel, in its latest funds raising round of $263 million. Funding valuation of the company currently stands at $4.1 billion. Bitpanda plans to expand its technology to the financial and fintech industry, however, at this moment there are no plans to go public.
After Amazon, Walmart is currently seeking to hire a crypto currency expert within the company. As the crypto currency market is expanding and many companies are digging into this area, the task of new expert will be to develop a “digital currency strategy and product roadmap”. Job is not only related to strategy aimed at retail clients, but it will also include strategies on crypto investments and potential partnerships in this area.
As of September 13th the European derivatives exchanger Eurex, part of Deutsche Boerse, will start trading exchange-traded note futures. This decision came after significant demand from institutional investors to have exposure to Bitcoin in a regulated environment. Contracts will be based on BTCetc Bitcoin Exchange Traded Crypto (BTCE) traded on Frankfurt Stock Exchange. Contracts will be traded in Euros.
Crypto market cap
Increased investors optimism has pushed crypto prices higher during the previous week. Total crypto market capitalization has reached $2 trillion, a level last time seen in May this year. Compared with the end of the previous week, this represents an increase of almost 7%, or additional $130 billion. Most contributing currency to this increase was Bitcoin. Daily trading volumes were flat for a third week in a row, moving around $220 billion on a daily basis. Total inflow from the beginning of this year stands at $1.27 trillion, which is an increase of 160%.
Positive sentiment for the crypto market continues. Increase in market cap during the previous week was mostly driven by Bitcoin who gained $32 billion in a single week, which was a gain of 3.6% in market cap for this coin. Cardano was another coin with good performance, supported by the latest announcements of an important network improvement coming in September. In a single week, Caradano gained an additional $9 billion or 13%. Regardless of negative news regarding potential lawsuits of its clients, Binance coin managed to attract additional $7billion or 10% in market cap. Interest for Tether also continues to increase as its circulating supply surged by 1.5% during last week.
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 BTC futures have increased by 11% for maturities up to October, and 14% for maturities in December this year. This increase is in line with the current spot market. Maturities after December were increased lower from current market developments implying potential slowdown of BTC price in this period.
Prices of ETH futures with shorter maturities have been modestly decreased compared to the previous week, but at the same time December 2021 and December 2022 have been increased by 7% and 4% respectively, implying market expectations of coin`s better performance during the next year.
Table below provides the most recent information on BTC and ETH future prices.
Bitcoin: $50K at test
After testing the support line at $45K during the beginning of the previous week, Bitcoin wasn't able to break it and reverted on the upside and next resistance line at $50K. As of the week-end BTC was traded above $49K. Although current levels are very close to resistance of $50K, still this level has not been tested by BTC during the week. For some time now, RSI is moving around 70, which is an indication that some reversal might come in the near future. MA50 is continuing to converge toward MA200, but still at a safe distance. Interestingly, despite the increase in price, trading volumes have modestly decreased during the previous week.
Current charts suggest that BTC will continue its ride to $50K resistance in order to test it. Considering current decreased trading volume it decreases probability for current resistance to be broken on the upside. On the other side, it increases probability for short term reversal, after $50K is finally tested.
Level to watch in the coming days is $50K. In case that it is broken on the upside, then BTC will make its move toward the next resistance line at $55K. However, in case of a short term reversal on downside, BTC will head shortly to $47K, with high probability to end the reversal around the $45K support line.
Ether: execution of futures is holding current price?
For the last two weeks Ether was struggling around level of $3.330 not being able to break it in order to continue its path toward the next resistance line at $3.500. A look at ETH futures historical prices for maturities in August 2021 shows that the majority of contracts were made around level of $3.330. However, during the previous week, ETH had a modest reversal toward the support line at $3K, but it soon went back again to level at $3.330, where the coin ended the week. RSI made a move toward level of 60 down to 50 and is still moving well below 70, which might provide some signal that coin still have space to make a clear move to overbought territory. MA50 is currently moving away from MA200.
Current charts suggest that pressure on the $3.330 level will continue in the coming days. As August futures soon reach full maturity, it could be expected that pressure on this level would decrease, which would allow ETH its further move toward $3.500 resistance. A move toward the resistance line would indicate a clear overbought market and ETH will enter into short term reversal.
Level to watch during the next week is $3.330. In case that it is broken on the upside, then ETH will make a move toward the resistance line at $3.500. In case that there is no strength to go above $3.330, it might be expected for a support line at $3K to be tested again.
Ripple: forming a double-top?
After a strong week and push of price to the level of $1.3, XRP slowed down a bit during the previous week and moved in a relatively flat mode. During the previous week XRP reverted a bit to downside in order to test the support line at $1 but soon reverted to the upside and to the level of $1.28 where it is currently traded. RSI moved to the level of 70 where it has moved during the whole week. MA50 is slowly converging toward MA200, but it is still at a safe distance.
Current charts are showing the possibility of double-top formation. In case that current resistance at $1.3 is not broken on downside, then XRP will inevitably make a move toward the support line at $1.20 down to $1.0. In case that this happens then full double-top formation in technical analysis will be revealed which is indication of clear short term trend reversal. Considering that since last week, volumes of trades have been significantly decreased, increases the probability of such future developments.
Level in focus during the next week will be $1.3. In case that it is broken on the upside, XRP will continue to next resistance at $1.4. However, considering current RSI level and decreased volumes of trading, there is a higher probability that XRP will revert to test support at $1.2 eventually $1.0.
Binance Coin: there is still space for a short reversal
Although there had been some negative news related to potential lawsuits against Binance due to outages during high volatility, Binance Coin continued its ride to the upside during the previous week. BNB started a week testing support line at $400, but quite soon reverted to the upside and finished week modestly above $450 level. For last three days RSI is moving in a clear overbought zone, implying that some short term reversal might come soon. For some time now oscillators are moving as two parallel lines, not indicating that some convergence is soon in store.
With its latest moves, BNB made a clear break of the $430 resistance line, which opens a clear way for next long term resistance at $520. However, considering technical indicators and clear move to the overbought zone, there might be some oscillations prior to the $520 level. There is a probability for BNB to revert a bit in order to test once again the support line at $430 before its final move further to the upside.
Cardano (ADA): new ATH is still to come in September?
Cardano reached a new ATH during the previous week by reaching the highest level at $2.58. As it has been anticipated, currently the major driver of demand for Cardano is the announced new network upgrade called “Alonzo” which will be implemented in September. This raises a question if the price of ADA could move even higher from current levels after the upgrade is successfully implemented in September? Similar moves we have been able to see recently with Ethereum`s network upgrade.
Certainly the topic of upgrade outcome will be closely monitored, but in September. At this moment, Cardano did enough by reaching a new ATH. RSI is in a clear overbought zone, so some short term price reversal might be expected. Currently, the support line stands at $2.20, which ADA might test during following days. Next support line stands at $2.0. On the upside, the latest level is $2.58, and if Cardano will be able to break it now or in September, we will see in the coming period.
LINK: holding strongly to MA200
During the previous week LINK was traded in a relatively mixed mode. Coin started a week testing support line at $25, went to test resistance at $30, but soon went down to $25 in order to move back to $30 as of the week-end. Such moves are showing that LINK currently doesn’t have strength to make a move outside the channel $25-$30. On the upside, the coin is also perfectly following MA200.
Considering that RSI is currently modestly below the overbought market zone, increases the probability that LINK will move one more time to the support line at $25, with some probability for the next support line at $20. On the upside, just in case that resistance at $30 is broken, the coin will head toward the next resistance line at $35.
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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