27th May 2022 | ZebPay Trade-Desk
The crypto market is now in the red. This includes Bitcoin and the other major cryptos that have seen decent gains in the first half. While the market is volatile, it trades range-bound. According to the minutes of Wednesday’s meeting, the FED indicated that interest rates could be increased by 0.5% at each of the 2 upcoming meetings. All other assets, except for stablecoins are trading at a low level. The crypto market now stands at $1.23 Trillion, after a more than 3% drop in market capitalization over the last 24 hours. Bitcoin and major altcoins are still trading in a range, trying to find a factor that will propel them in a certain direction.
Since May 16, Bitcoin (BTC), has struggled to keep above $30,800. This suggests that demand is leaving at higher levels. The US stock market continues to fall due to uncertainty about how many rate hikes will be necessary to manage inflation. The crypto market was again hit on May 26th with another round of selling. Bitcoin (BTC), fell to $28,000, and Ether (ETH), briefly fell below $1800. The ETH/BTC price pair also dropped below what traders consider a key uptrendline, a move traders believe could lead to Ether’s falling to new lows.
Analysts are becoming more bearish about their predictions for the volume of the fall as the crypto market grows. According to traders, Bitcoin could plummet from $19,000 to $15,000.500 before a backside is formed. Research recently revealed that the Bitcoin’s Fear and Greed Index has reached a rating of 8. This had resulted in a mean 30-day return of 28.72%. The index reached eight on May 17, interestingly.
The Ether (ETH) has had a poor 3 month performance. The 50% correction since April 3rd caused the altcoin’s $1,800 assistance to be checked for the first time since July 2021. An additional panic among Ether buyers led to a seven-block chain reorg of Ethereum’s Beacon Chain, which took place on May 25. This case is not unusual. It would have come from either a miner with too many assets or a bug. Open interest in the Ether’s May month to month options expiry is $1.04 trillion, but the real numbers could be lower because bulls are overly optimistic.
Investors sought refuge in the US dollar due to stock volatility. The DXY index reached its highest point in 20 years on May 13th. The DXY compares the USD to a basket of major currencies, including the Euro (EUR), the British Pound (GBP) and the Japanese Yoen (JPY). The US five-year Treasury yield reached 3.10% on May 9th 2018, its highest level since August 2018. This indicates that investors demand higher yields to offset inflation. The market’s decline is partly explained by the fact that macroeconomic data reflect investors’ risk-averseness.
Technical Outlook
BITCOIN:
BITCOIN traded in red the past eight weeks, the first time this has happened in history. The asset has been trading sideways since the $26,700 bottom. It is consolidating between $28,000 and $31,000. BTC has been able to hold multiple support levels around $28,800 before. This time, however, it is not closing below that support. This indicates that BTC is buying at lower levels. If the breakout happens above $31,500 and there are good volumes, then we can expect a rally to $34k-$37k. A close below $28,500 could lead to further declines. Prices can even test $25k.
ETH:
After hitting a low of $1763, ETH has been consolidating between $1900 and $2150 since then. Yesterday, the asset made a break out on the downside and hit a new low at $1,733. ETH is supported by $1,700 (previous low of the ‘Double Bottom” pattern). The bulls will be able to defend their support and we can expect some relief rally or short covering. A break below $1700 could lead to further decline and prices could fall to $1,500.
BAT:
BAT was receiving support at $0.55. The asset broke the support and fell to $0.30. BAT traded sideways after this move with low volumes. It is consolidating in a range of $0.34 to $0.45. The trend will be further determined by breakouts that occur on either side, if there are good volumes.
Weekly Snapshot
USD ($)19 May 2226 May 22Previous WeekCurrent WeekCloseClose% ChangeHighLowHighLowBTC$30,314$29,268-3.45%$31,308$28,703$30,591$28,262ETH$2,018$1,804-10.62%$2,147$1,907$2,080$1,727BAT$0.39$0.37-4.33%$0.43$0.35$0.42$0.35Cryptocurrency1w – % Vol. Change (Global)BitCoin (BTC)-14.27%Ethereum (ETH)-22.70%Basic Attention Token (BAT)-8.20%Resistance 2$36,500$2,150$0.85$0.60Resistance 1$31,500$1,900$0.70$0.45USDBTCETHMATICBATSupport 1$28,800$1,700$0.50$0.35Support 2$25,000$1,500$0.35$0.30
Market Updates
Brazil’s Federal Reserve has announced that Brazilian crypto-asset investors must pay income taxes on transactions that involve like-kind exchanges of cryptocurrencies. This includes Bitcoin (BTC), Ethereum (ETH), and Polygon (MATIC).
*Sources of charts: https://cryptowat.ch, https://pro.zebpay.com/trade/USDT-INR
Disclaimer: This report should not be regarded as investment advice. It does not consider the financial situation or investment goals of investors. When deciding whether an investment is right for them, all investors should take into account these factors and consult with a professional advisor. This report was prepared by the Company using information that it has access to, as well as information from public sources that has not been independently verified. The Company makes no representations or warranties, either express or implied, regarding the accuracy, reliability, correctness or completeness of the information, opinions or conclusions contained herein. This report is preliminary. The Company does not assume any obligation to revise or update the reports in response to new events or circumstances after the date of the report was made. Trading and Investments in cryptocurrencies viz. Bitcoin Cash, Ethereum, and other cryptocurrencies are highly speculative investments that are subject to market risk. The Author’s analysis should be used only as information and should not be considered investment advice.
27th-May-2022 ZebPay
