24 Dec 2021 | ZebPay Trade-Desk
Markets have been fairly range-bound this week, moving sideways making it difficult to ascertain a particular trend. Bitcoin (BTC) has been moving in the range of $46k-$51k, while Ethereum (ETH) has been trading in the range of $3.8k-$4.1k. The tussle between the bears and the bulls is what is keeping this battle alive, and for anything drastic to happen, the market would have to move in a particular direction for a sustainable amount of time. BTC dominance stands at 40.2%, while ETH closes in on a 21% share, not because of its own performance, but due to the fact that it has overperformed BTC through most of the year thus far.
Having said that, BTC is trying to break above the psychologically critical level at $50,000 and close the year on a strong note. On the same lines, the bulls are attempting to push and sustain ETH above the 20-day EMA of $4,055. If this does happen, the corrective phase could be over, and we might witness another rally. On the other hand, if the price turns down from the current level, we can safely assume that the sentiment will stay negative.
ETH did undergo a hard-fork (Arrow Glacier upgrade) last week, which briefly had a positive impact on price, but that quickly eroded. While bears are in control currently, the market seems to be in a consolidation phase. Some signs of relief did come in after the United States Federal Reserve provided a short-lived performance boost, but overall, progress has been limp compared to earlier in the year. The immediate outlook was no more favourable, with the Coronavirus Omicron variant sparking fresh economic shutdowns set to last into the new year.
Polygon (MATIC) has acquired a zero-knowledge startup – Mir in a $400 million deal, as part of its efforts to scale Ethereum and bring users to Web3. Polygon sees zero-knowledge (ZK) cryptography as the most promising technology to scale blockchains. On Friday, Polygon and venture capital firm Seven Seven Six signed a $200 million deal. The initiative will back projects operating at the intersection of social media and Web 3.0. The focus will be on gaming applications and social media platforms built on Polygon’s infrastructure.
Like many crypto-focused businesses, Polygon is experiencing fast-paced growth. The platform has about 120 million unique addresses after users “increased sharply” in 2021, claimed the CEO. The number of dApps on the platform rose 9,900% from 30 in November 2020 to 3,000 in November 2021. AVAX surged 41% in the last week and sits at $121 at the time of writing. The rally may be due to two factors: the addition of USDC, and Bitgo’s recent announcement that they would list AVAX.
Last month, the IMF warned of the increasing use of crypto in the developing world – something it referred to as “cryptoization” – which could destabilise economies and hamper central banks’ monetary policy, and regulation around the same might help counteract this. The next few days shall be crucial for us to be able to assess which side the market will trend, as currently much of it is moving sideways.
Technical Outlook:
Bitcoin:
Bitcoin after witnessing a sharp fall from $69,000 to $42,333 started consolidating. The asset is trading sideways in a range from $45,000 to $51,000 forming a ‘Rectangle Pattern’. BTC took multiple support at $45,000 and is showing signs of recovery. Once the breakout occurs above $53,000 with good volumes then we can expect the asset to further rally up to $60k mark. If the prices break the support of $45k then the prices can further slide to $40k levels.
ETH:
ETH after making the low of $3,436 started trading in a range forming a ‘Symmetrical Triangle’ pattern ( which represents a period of consolidation before the price is forced to breakout or breakdown). The lower longer shadows indicate buying at lower levels. However to rally or to witness a bullish move the prices need to give a breakout above the pattern with good volumes. Hence to further rally, the asset needs to close and sustain above $4,200.
MATIC:
Matic is trading in an uptrend since July and the prices have surged to $2.73 from $ 0.62 within six months. Technically on a weekly time frame, the asset is trading in a ‘Higher Top Higher Bottom’ formation. The rising moving average and RSI in the positive territory indicate that the bulls still have the upper hand. However, one needs to be cautious as the asset may face resistance at the psychological level of $3 and can witness some profit booking.
Weekly Snapshot:
| USD ($) | 16 Dec 21 | 23 Dec 21 | Previous Week | Current Week | |||
| Close | Close | % Change | High | Low | High | Low | |
| BTC | $47,530 | $50,785 | 6.85% | $50,473 | $45,895 | $51,506 | $45,580 |
| ETH | $3,956 | $4,108 | 3.84% | $4,227 | $3,665 | $4,149 | $3,711 |
| MATIC | $2.07 | $2.68 | 29.47% | $2.29 | $1.74 | $2.70 | $1.95 |
| Cryptocurrency | 1w – % Vol. Change (Global) |
| BitCoin (BTC) | -6.90% |
| Ethereum (ETH) | -17.08% |
| Pologon (MATIC) | 0.22% |
| Resistance 2 | $60,000 | $4,865 | $3.00 | $1.70 |
| Resistance 1 | $53,000 | $4,200 | $2.75 | $1.45 |
| USD | BTC | ETH | MATIC | BAT |
| Support 1 | $45,000 | $3,900 | $2.20 | $1.15 |
| Support 2 | $38,500 | $3,650 | $1.75 | $0.90 |
Market Updates:
- Vladimir Chinstyukhin said that Russians will be able to invest in cryptocurrencies like BTC and ETH but only via foreign companies and ‘domestic infrastructure or intermediaries’ can’t be used.
- Wyoming Senator Cynthia Lummis, one of the United States lawmakers behind many pro-crypto pieces of legislation, is planning to introduce a comprehensive bill next year to handle digital assets.
- Despite PBOC’s (People’s Bank of China) warning on the metaverse and NFTs last month, a huge amount of companies ,more than 1360 Chinese firms, have submitted about 8,534 trademark applications in accordance with the metaverse and this number continues to increase every day.
- Bent Finance, a staking and farming platform has fallen prey to the crypto hack, it is expected that approximately 440 ETH is stolen. For now the platform had acknowledged the attack and appealed the investors to withdraw funds from the pools and have also disabled reward claims.
- Terra (LUNA), an open-source stablecoin network, hit an all-time high of $20.05 billion in total value locked, or TVL, across its 13 product offerings, according to industry data, making it the second-biggest DeFi chain in terms of total value locked after Ethereum.
*Sources of charts: https://cryptowat.ch, https://pro.zebpay.com/trade/USDT-INR
Disclaimer: This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum etc.are very speculative and are subject to market risks. The analysis by the Author is for informational purposes only and should not be treated as investment advice.
