18 February 2022 | ZebPay Trade-Desk
BTC has continued to test the $45k price level this week, but as of the last 24H, the cryptocurrency has traded downwards near the lower end of its 24H range at ~$40k. Yesterday, the equity markets saw movements in both directions in the morning following reports of the US and NATO claiming that Russia had not withdrawn troops from Ukraine’s border. However, the markets rallied slightly later in the day after the Fed minutes indicated a slow approach to raising interest rates. The spillover-over effect, also caused crypto markets to turn red, as investors have become cautious, and the sentiment has turned negative, due to the overall macroeconomic situation.
The Fed minutes recognized the crypto industry and the potential risks associated with stable coins. It raised concerns about the significant growth of the crypto industry, stating that “some participants saw emerging risks to financial stability associated with the rapid growth in crypto-assets and decentralized finance platforms,” the stated. The Fed categorized stable coins as “another vulnerability in funding markets”. Overall, markets remained relatively steady following the meeting, with traders mainly focused on the Fed’s next meeting in March when the central bank is expected to start hiking rates.
Over the last week, the majority of trading volumes across the desk are coming from BTC & ETH vs. top altcoins as investors continue to trade further down the risk curve, with BTC & ETH outperforming the majority of top altcoins. Trading volumes across the desk have been consistent with this theme as BTC & ETH continue to drive the majority of trading volumes. We’re also seeing buying pressure in notable layer 1’s like AVAX and SOL, respectively. We see this increased trading activity in layer 1’s like AVAX and SOL as a potential indication that investors are beginning to look to move up the risk curve ahead of March.
We’re in a cycle right now where events completely separate from crypto (imminent rate hikes, Russia-Ukraine) threaten to completely disrupt the frankly strong narrative which crypto has established here in 2022. However, even then we are seeing strong fundamental developments take place. An example of one is, Twitter adding Ethereum wallet support, this was not a surprise to the market but is still a relatively big deal for ETH. Every Layer1 has its own case for an NFT ecosystem, and Ethereum’s position in the PFP space seems like a secure lead, which will only grow with Twitter integration. It also does highlight a key advantage that Ethereum has at this moment, which is wallet infrastructure readier to interact with Big Tech. This will surely change over time, but this feels like a space where the first-mover advantage is no small factor.
Technical Outlook
BITCOIN:
BITCOIN after surging almost by 39% from the low of $32,9333 faced stiff resistance at $45,500 (Horizontal trendline) and witnessed a minor correction making the low of $40,099. The asset has a strong support zone from $40,000 to $39,500, If it holds and bounces from the support then the bulls may resume the up move, and to witness a rally BTC needs to break and close above $45,500 with good volumes. A break below $39,500 will lead to the further downfall and the prices may drop to $35k.
ETH:
ETH after taking multiple support around $2,400 rallied almost by 37% making the high of $3,288. Post this move, the asset is consolidating and is trading in a broad range from $3,200 to $2,850. Breakouts on either side of the range with good volumes will further decide the trend for the asset.
MATIC:
Matic after consolidating between $1.5 to $1.75 gave a breakout on the upside and rallied up to $2.1. The asset faced stiff resistance at $2.11 (50% Fibonacci Retracement Level) and has corrected almost by 24%. However, Matic has made a ‘Morning Star’ pattern (Bullish Pattern) at $1.6. If the prices hold and sustain these levels then we can expect the bulls to resume the up move. A break below $1.594 will negate the analysis.
Weekly Snapshot:
USD ($)10 Feb 2217 Feb 22Previous WeekCurrent WeekCloseClose% ChangeHighLowHighLowBTC$43,403$40,249-7.27%$45,661$41,038$44,667$40,249ETH$3,077$2,881-6.37%$3,271$2,675$3,186$2,840BAT$0.89$0.76-13.89%$0.99$0.82$0.89$0.76
Cryptocurrency1w – % Vol. Change (Global)BitCoin (BTC)-18.03%Ethereum (ETH)-14.86%Basic Attention Token (BAT)-22.93%
Resistance 2$53,000$3,650$1.15$2.40Resistance 1$45,500$3,300$0.99$2.10USDBTCETHBATMATICSupport 1$39,500$2,850$0.72$1.50Support 2$35,000$2,400$0.60$1.30
Market Updates:
Avalanche, a layer-1 proof-of-stake blockchain network, gets a new cross-chain bridge from Umbria Network to help traders transfer liquidity between the Ethereum mainnet and the Avalanche blockchain.Major crypto exchange Binance has reportedly halted activities and marketing to Israelis following a request from one of the country’s financial regulators over licensing.American venture capital firm Sequoia Capital has launched a new cryptocurrency fund as part of its ongoing efforts to bootstrap the next generation of blockchain-focused startups.Major financial services firm Fidelity International will be listing a Bitcoin exchange-traded product on the SIX Swiss Exchange and Germany’s Xetra digital stock exchange.
*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.
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