Crypto Market Update June 17, 2022
Crypto traders have realized the importance of decentralization and transparency as the LUNA domino effect continues to disrupt cryptocurrency markets, leaving fundamentally strong protocols to pick up the pieces.
Top Market Trends of the Week
- Based on past technology adoption curves and exponential growth, the Blockware research predicts that Bitcoin adoption will reach 1 billion by 2030.
- TBD, Jack Dorsey’s Bitcoin company, has unveiled its new concept for Web5, a decentralized internet layer built on Bitcoin.
- Circle has announced the creation of a stablecoin linked to the Euro. To preserve 1:1 redeemability, EURO COIN (EUROC) has a complete reserve stored in euro-denominated bank accounts.
- Merit Circle DAO voted to “refund” $1 million to one of its investors (YGG), effectively canceling their SAFT agreement and the nearly $5 million in money owed to YGG. The vote was successful, and YGG accepted it.
- The hedge fund Three Arrows Capital (3AC) is on the verge of going bankrupt, and liquidity provider 8 Blocks Capital has accused them of taking $1 million to cover margin calls.
Top 7-day Gainers
- USDN +2.5%
- PAXG +0.6%
- XAUT +0.5%
- USDT +0.2%
- FRAX +0.2%
Top 7-day Losers
- DFI -47.1%
- XCN -45.4%
- NEXO -44.2%
- WAVES -42.7%
- stETH -40.4%
Bitcoin’s Technical Summary
Despite the Federal Reserve’s announcement of significant quantitative tightening on Wednesday, Bitcoin dissociated from the Nasdaq and moved in the positive direction on Thursday, following a 7-day 35% price decrease.
LUNA contagion is shaking out undercollateralized and overleveraged businesses that are tumbling like dominos, according to seasoned Bitcoiners who have witnessed many downturn markets.
- Bitcoin (BTC) may have dropped by 35% this week, but analysts at CryptoQuant believe it will continue to fall until more coins are sold at a loss.
- The 200-week moving average, which was trading at $22,367, provided support for BTC. BTC has now struck this support level four times in its history, with each time being followed by a 110-day (average) consolidation period.
- The RSI level is currently at an all-time low of 26.6, and traders are hoping for a price floor of $21,000.
So we used the Fibonacci retracement to zoom out on the 2-hour BTC chart. Then, on June 7th, at $31.1k, we saw a downward trend. The retracement’s bottom was drawn on June 15th, and the RSI touched a new monthly low of 9 on June 14th. Only a minor struggle was shown on the chart to break through the first two lines of support at $29k (0.786) and $27.1k (0.618).
Then came the free fall, which took RSI on a thrilling ride down. The RSI was only between the 30 to 50 bracket after the price made its crash landing with a few bounces on June 15th. If it stays in that range, the price may as well be locked between the 20,080 and 22,780 support and resistance levels. As the bulls and bears battle it out in this price range, it could be a good opportunity to scalp.
If we zoom out on the macro trend on the 1-week chart for Bitcoin, we may be flirting with the resistance and support area that Bitcoin has visited twice before: in December 2017 (at the market peak) and December 2020 (Just before the bull run of 2021). The pricing range is from $20,000 to $17,500. They are currently acting like a bull’s line of defense, as these two price marks are acting as resistance to the bear market. Expect our next macro support band to be 17.5k if the price cannot bounce off the 20k support band.
Altcoin’s Technical Summary
This week, Ethereum struck a new low by falling below its all-time high from January 2018, as altcoins continued to bleed and over 30 of crypto’s top 100 coins fell by more than 30%.
Between the LUNA and Celsius collapses and the other after-effects, the industry is currently in a cleansing period. Only the most fundamentally powerful protocols are likely to survive, resulting in a stronger market in the end, regardless of how difficult the route is.
- On Uniswap, the price of Ethereum (ETH) dropped to $950 in a flash as a whale offloaded 93k ETH. For the first time since November 2018, the RSI entered the oversold territory.
- Despite its price hitting new lows, Ethereum’s power is showing no signs of waning: the number of unique Ethereum wallet addresses continues to rise.
- In reaction to a liquidity crisis, the Celsius (CEL) lending protocol halted withdrawals, swaps, and transfers on June 12th. Investors are concerned about more domino repercussions.
Ethereum’s Technical Analysis
Throughout October and December of 2017, there was a point of support. In April 2018, ETH/BTC rebounded off it, and it took a two-day battle to break through on August 11th, 2018. Between May and August 2021, ETH/BTC broke through the resistance level and changed it into support. Right now, we may see this resistance level being tested.
I hope you found this crypto market update useful!
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