Crypto Week at a Glance: Consolidation Continues with Looming Breakout


The past week has been a period of consolidation as the market attempts to break out of current levels to regain bullish trends. We had the Miami Bitcoin 2021 conference, yet another tweet from Musk that got the market moving, and the continued and unsurprisingly march of crypto and blockchain adoption is taking shape globally with positive news feeding each other.

On the CBDC (Central Bank Digital Currency) front, the Bank of Thailand has started to prototype a digital currency format with a three-year horizon to implement. More such experiments are likely and will drive adoption of the cryptocurrency market in the future.

WisdomTree, a New York-based exchange-traded fund (ETF), has filed an Ethereum-based ETF with the SEC. The fund has already applied for a Bitcoin-based ETF. ETFs, once approved, will provide access to millions of people to indirectly invest in cryptocurrencies, although there is a risk of capital withdrawal from the cryptocurrency market in the short term.

In terms of market movements in particular, the month of May was marked by high volatility after a few highs in April. Bitcoin hit a low of $ 30.7,000 on May 19, a drop of more than 50% from its record price in April. He retested similar levels less than a week later and built a symmetrical triangular pattern in the relatively narrow band between $ 34,000 and $ 38,000. Now, symmetrical triangular patterns can pop to one side or the other – up or down, depending on market sentiment.

On June 3, however, Bitcoin came out of the squeeze and appeared to be heading towards $ 40,000, but a “breaking” tweet from Elon Musk came in to around $ 37,000. However, he recovered quickly over the course of the day, perhaps showing a sign that the market may be gradually isolated from Musk’s influence. Over-the-counter (OTC) counters have also seen substantial cash outflows over the past two weeks, signifying a drop in demand from institutional investors. Bitcoin’s market cap is currently hovering around $ 700 billion.

Over the long term, Bitcoin continues to have bullish projections from several financial institutions for June and beyond, although some are predicting another correction towards $ 30,000 or even beyond once a “rally.” relief ”has been played out. Overall market sentiment regarding Bitcoin is still positive, and we expect that once Bitcoin crosses the $ 42,000 level, other altcoins will potentially rise at a higher rate during the month during this rally of relief. .

Key levels of assistance: $ 38,000, $ 36,700, $ 36,000, $ 34,760, $ 34,000.

Key resistance levels: $ 38,900, $ 40,000, $ 40,760, $ 41,475, $ 42,055.

Ethereum (ETH), the second largest cryptocurrency by market cap, has shown a similar trend to Bitcoin. Over the past week, Ethereum has been up 4% and is now falling to $ 3,000. On June 3, ETH hit a weekly high of $ 2,890. In the near future, Ethereum is expected to break above the $ 3,000 mark and hold on to it to maintain an uptrend.

Like Bitcoin, Ethereum has also caught the attention of major industries and traditional investors, with Goldman Sachs even giving it a “big chance” to overtake Bitcoin as a store of value. Ethereum is one of the major blockchains that support DeFi (decentralized finance) applications today. The impending Ethereum blockchain upgrade in Q4 2021 is expected to increase its prices as the coin supply is expected to decrease with additional functionality.

ethereum

Overall, we expect a rally for BTC and ETH after Monday, given the general trend in the markets to red this weekend. Among the key altcoins, Cardano (ADA), Dogecoin (DOGE) and Polygon (MATIC) are likely to gain when BTC breaks out. DOGE benefited from its listing on Coinbase Pro this week as well as a potential collaboration with ETH for scalability (as suggested by Ethereum founder Vitalik Buterin).

Top winners of the week (as of June 6, 2021 at 9.45 a.m. Source: CoinMarketCap):

⦁ Theta Fuel (TFUEL), 59.46%

1 inch (1 INCH), 58.75%

⦁ DAO Token (CRV) curve, 50.04%

Solana (SOL), 47.92%

Theta (THETA), 42.93%

Top Losers of the Week (as of June 6, 2021 at 9.45 a.m. Source: CoinMarketCap):

Horizen (ZEN), 11.94%

Currency (NMR), 9.89

⦁ Polygon (MATIC), 9.49%

Revain (REV), 7.58%

Helium (HNT), 5.88%


About Emilie Brandow

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