The complete overview of the day's events on the (crypto) markets. Compactly summarized in the market commentary of the CVJ.CH editorial team.
Market Commentary
Well, the time has come after all... Bitcoin (BTC) was not able to hold the support around USD 30,000 and is in free fall towards the old all-time high at USD 20,000. This puts the crypto market in its twelfth consecutive red week, with the exception of a tiny consolidation at the end of May.
The constant selling pressure is owed to the turbulent macro environment and the forced liquidation of various players like Terra. They are possibly going to be joined by CeDeFi platform Celsius and the Tron copy of the UST stablecoin (USDD). In the grand scheme of things, we are approaching a market-wide capitulation. Thus, the brutal downside should end at the latest at the USD 20,000 level, which is the former all-time high of the 2017/18 cycle as well as the 200 week moving average (200 week SMA).
Ethereum loses all support levels
Although Ether (ETH) showed relative strength against Bitcoin a few weeks ago, the price fell through every support level. Eleven red weekly candles in a row took the price below the 2017/18 all-time high of USD 1,420; and that without a single relief rally. The next support is located around USD 800.
The price action of Ether against Bitcoin can be illustrated by the ETH/BTC ratio. This has been in a steady uptrend since the depths of the 2019 bear market, coming to a halt between 0.055 and 0.845. With the break of this trading range, the ratio is moving back into bear territory. Whether the transition to Proof of Stake (also known as "The Merge") can put an end to this will be seen in September to October at the latest.
Bloodbath in the altcoin markets
The bear market in the two largest cryptocurrencies by market cap also led to "risk off" sentiment in altcoins. Only one of the top 20 coins, Bitfinex exchange token Unus Sed Leo (LEO), is in green territory year-to-date.
Layer 1 blockchain Avalanche (AVAX) -83.91%, its competitor Solana (SOL) -82.01% and layer 2 scaling solution Polygon (MATIC) -80.11% were hit particularly hard. However, the rest of the largest cryptocurrencies also lost over 50% since the beginning of the year, with only the FTX Exchange token (FTT) withstanding Bitcoin's slump (-33.08% vs. -42.69% for BTC).
Disclaimer
All information in this publication is provided for general information purposes only. The information provided in this publication does not constitute investment advice and is not intended as such. This publication does not constitute and is not intended as an offer, recommendation or solicitation to invest in any financial instrument, including cryptocurrencies and the like. The contents contained in the publication represent the personal opinions of the respective authors and are not suitable or intended as a basis for decision-making.
Risk notice
Investing in cryptocurrencies, is fundamentally associated with risk. The total loss of the invested capital cannot be excluded. Cryptocurrencies are very volatile and can therefore be exposed to extreme price fluctuations in a short period of time.
