Recurring market commentary on what’s happening in the crypto markets, summarized by the Crypto Broker team at Crypto Finance AG.
Market commentary
Good morning!
The crypto market saw another week of severe losses. At the time of writing, Bitcoin (BTC) is trading at $19.5k (-5.9% in 7 days), Ethereum (ETH) is trading at $1.11k (-6.8% in 7 days), and the ETH/BTC spread is trading at 0.05686 (-1.07% in 7 days).
The euro is under huge selling pressure: investors are looking for safe-haven currencies, e.g. CHF. However, inflation numbers are worsening even in Switzerland, which means that a short-term risk reversal in the pair is feasible. In the medium to long term, I expect the SNB to raise rates, making the CHF really appealing, and the EUR/CHF is traded below par.
Crypto market volume continues to decline
The total market cap in crypto is $894.29B, after peaking at $3T in November 2022. We are now testing the 2018 all-time high and trading slightly above the 200-week moving average. This is definitely a strong support, and definitely provides a nice entry point. Looking at the Heikin Ashi candles, the weekly trend shows that there is still some space on the way down, but should we see a green week, it could be the sign of a reversal.
RSI is oversold, but the SMA of the RSI is still above the 40 threshold. GARCH(1,1) is not expecting higher volatility, and I am therefore not expecting a strong rebound. Should we break the current support, we might soon test the $560B market cap area first and the lower $300B afterwards.
Looking at the 4h chart, we see that there is a head and shoulder pattern forming. Should ETH not break the upper $1,250 resistance, we might soon test $1,000 again.
Happy Trading!
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