27th May 2022 | ZebPay Trade-Desk
The crypto market is back in the red. And this also includes Bitcoin and other major cryptos which are witnessing decent gains during the first half of the week. The market is currently volatile whilst it continues to trade range-bound. As per the minutes of the meeting released on Wednesday by the FED, mainly indicated that the interest rates might be raised by 0.5% in each of the next 2 meetings. Except for the stablecoins, all other assets are mostly trading low. With over 3% fall in the market capitalization in the last 24 hours, the crypto market is now at $1.23 Trillion. Bitcoin and the major altcoins have stuck trading in range trying to find a factor which will push them in some direction.
Bitcoin (BTC) has been struggling to stay above $30,800 since May 16, suggesting demand is exiting at higher levels. Similarly, US stock markets have continued to fall on uncertainty over the number of rate hikes it will take to control inflation. During the latter half of the week, the crypto market was hit by another round of selling on May 26, as Bitcoin (BTC) price dropped to $28,000 and Ether (ETH) briefly fell below $1,800. The ETH/BTC pair also fell below what traders see as a key uptrend line, a move that traders say could see Ether’s price correct to fresh lows.
As the crypto market deepens, analysts are getting more bearish on their projections for the volume of the fall. Traders have mentioned that Bitcoin will be susceptible to falling from $19,000 to $15,500 earlier than a backside is formed. However, Research lately mentioned that the Bitcoin’s Fear and Greed Index reaches a rating of eight had led to a mean of 30-day go back of 28.72%. Interestingly, the index hit eight on May 17.
Ether’s (ETH) overall performance over the last 3 months has been much less than pleasant for holders and the 50% correction since 3rd April induced the altcoin to check the $1,800 assist for the primary time because July 2021. Further developing panic amongst Ether buyers turned into a seven-block chain reorg on Ethereum’s Beacon Chain on May 25. Fortunately, this case isn’t unusual and it’d have emerged from a miner with excessive assets or a bug. The open interest for the Ether’s May month-to-month options expiry is $1.04 billion, however the real numbers might decrease because bulls have been overly-optimistic.
Due to the volatility of stocks, investors sought refuge in the US dollar and on May 13, the DXY index reached its highest level in 20 years. The DXY measures the USD against a basket of major foreign currencies including the British Pound (GBP), the Euro (EUR) and the Japanese Yen (JPY). In addition, the US five-year Treasury yield hit 3.10%, its highest since August 2018 on 9th May noting that investors are demanding higher yields to offset inflation. In short, the macroeconomic data reflects investors’ risk-averse sentiment, which partly explains the decline in the market.
BITCOIN has traded in red for the past eight weeks in a row, for the first time in history. However, after making the recent bottom of $26,700, the asset is trading sideways and consolidating in a range between $28,000 to $31,000. BTC has taken multiple support around $28,800 in the past and this time too, we can see that it is not giving the daily closing below the support indicating buying at lower levels. Once the breakout occurs above $31,500 with good volumes then we can expect a rally up to $34k to $37k whereas a close below $28,500 will lead to a further downfall and the prices can test $25k levels.
ETH after making the low of $1,763 on 12th MAY started consolidating between $1,900 to $2,150. The asset gave a breakout on the downside yesterday and made a new low of $1,733. ETH has a strong support at $1,700 (Previous low of ‘Double Bottom’ pattern). If the bulls can defend the support we can expect some short covering or a relief rally whereas a break below $1,700 will lead to further downfall and the prices can slide to $1,500 level.
BAT was taking support at $0.55. However, the asset broke the support and witnessed a sharp fall making the low of $0.30. Post this move, BAT is trading sideways with low volumes and consolidating in a range from $0.34 to $0.45. Breakouts on either side of the range with good volumes will further decide the trend for the asset.
|USD ($)||19 May 22||26 May 22||Previous Week||Current Week|
|Cryptocurrency||1w – % Vol. Change (Global)|
|Basic Attention Token (BAT)||-8.20%|
- Brazil’s Federal Reserve (RFB) has declared that Brazilian investors in the crypto-asset market must pay income tax on transactions that involve the like-kind exchange of cryptocurrencies; for example, Bitcoin (BTC) for Ethereum (ETH).
- ARK Investment Management, an investment firm founded by veteran investor Cathie Wood, is taking another try to launch a spot Bitcoin (BTC) exchange-traded fund (ETF) in the United States.
- The Fed vice chair told the House Financial Services Committee that a CBDC offers stability, and interoperability in an increasingly complex economic system.
- Amid market issues surrounding stablecoins, Tether (USDT) launched a new digital asset with ticker MXNT that will be pegged to the Mexican peso on Ethereum (ETH), Tron (TRX) and Polygon (MATIC) networks.
*Sources of charts: https://cryptowat.ch, https://pro.zebpay.com/trade/USDT-INR
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