Crypto Point of the Weekend: Ethereum on the Rise, Will It Need Altcoins on Its Rebound?

In this second crypto point of the weekend, we will continue our analysis in line with the last week. The market has continued its recovery since last Sunday. Ethereum, as part of some news related to The Merge, surged higher last night. This allowed some altcoins to break through an initial resistance. However, nothing has been decided yet. So let’s go to TradingView to take stock.

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Is the market still in the same situation?

Price of the total market cap of cryptocurrencies (1D)

As of last week, the situation hasn’t really changed for total market cap. You see, the reach is still relevant. In a few days we have witnessed a rebound on the $833 billion to find itself at this moment in the resistance to $963 billion. As mentioned last week, it is useless to speculate about a future move until we have a resolution on the range.

Therefore, the levels mentioned last week should always be kept in mind. If the market breaks through the resistance, we can return of market capitalization at the lower bound of summer 2021 support. For now, nothing has been confirmed and will largely depend on Bitcoin and Ethereum swings.

Altcoins still have resistance

Market cap price of cryptocurrencies excluding Bitcoin and Ethereum on a daily scale
Market Cap Price for Cryptocurrency Excluding Bitcoin and Ethereum (1D)

about the altcoins, the situation has hardly changed since the latter failed to peak above $394 billion. However, a record of more than 340 billion has been registered, demonstrating the short-term interest of buyers in altcoins. Currently at the same level as the recent high on 381 billionthe goal is to register a new high to relaunch bullish momentum on a daily scale.

For the time being, nothing has been decided yet, it will be necessary to wait for the closure of this Sunday, which will also make it possible to obtain a new week-end. If the altcoins manage to overcome the $394 billion level, we may have two bullish targets in our sights:

  • $413 billiona former support that did not remain as resistance
  • $456 billiona daily resistance that has repeatedly rejected altcoins.

Conversely, a loss of 340 billion will inevitably push the market back to its previous low.

A Bitcoin Extending Its Substandard Situation

Bitcoin dominance course on a daily scale
Bitcoin Dominance Course (1D)

While we could have considered keeping the king of cryptocurrencies in its pivot zone (shown in blue) last week, the market decided otherwise by extending bitcoin’s underperformance relative to the rest of the market. Indeed, in just one month it went from a 48% dominance to 42%. The current challenge, if bitcoin is to hold its course in this bear market, is to recapture the pivot zone at 43%.

Very recently, bitcoin’s dominance broke its lows, allowing altcoins to continue their upswing in the markets. If this dynamic tends to hold, before the 40% dominance, we can think of two intermediate targets where the king of cryptocurrencies could recover:

  • The 42.20%a level that has acted as support and resistance to bitcoin’s dominance
  • The 41.32%support from February 2022

Ethereum is temporarily taking over the cryptocurrency market?

Ethereum price versus bitcoin on a daily basis
Ethereum price versus bitcoin (1D)

Since last week, the daily bullish trend on the ETH/BTC pair has expanded. The asset managed to hold a high level before triggering a momentum that broke the top 0.059 Bitcoin to look for the top level which is at 0.065 bitcoin. This last level, which has acted as an important support for several months, has never been quiet. However, yesterday Ethereum did so, confirming the bearish break that occurred in May.

This level is undoubtedly very important and should undermine Ethereum’s current momentum. While we may have a bullish excess reaching the 0.069 Bitcoin, a weekly close above these levels will be very complicated. These are likely major resistances where Ethereum could fail before returning to lower price levels. Indeed, remember that the weekly trend is bearish. Don’t be surprised by technical bounces needed to correct bearish excesses.

What about decentralized finance?

Price of the DeFi Index Perpetual Futures against the dollar on a daily scale
DeFi Index Perpetual Futures Price (1D)

In the same way as the index analyzed last week, that of altcoins, today let’s look at that of decentralized finance. This FTX index brings together a basket of assets from the Challenge. Thus, with a small sample of cryptocurrencies, we can know the main trends of the sector, the situation it is in. After an explosion in 2021 and a record high in May 2021 at $17,137the index entered a range between May 2021 and May 2022 before collapsing.

Returning to levels not seen since late 2020, decentralized finance is being challenged within a ruthless bear market. It recovers for a few weeks with a daily uptrend, but remains in the order of a technical upswing that does not provide upward momentum on a weekly scale. Given that the trend should continue, we can have an important key level in mind in this context for now: the $3,400. If the price reaches this level, we may prefer a rejection of the price with possibly a small bullish excess.

Here we are at the end of this second crypto point of the weekend. Like last week, the total market cap is still moving within its range with, in parallel, an bitcoin bowed back. This allows Ethereum and altcoins to temporarily benefit from it. Be it an upswing or a decline of the king of cryptocurrencies in the market, sooner or later he will resume his leadership role to give direction to the rest of the market. Keep in mind that the weekly trend is still bearish for now. So if you have not had the opportunity to top up at the lower end of the current range, avoid buying the upper limit at which the assets can be rejected.

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