Weekly Crypto Market Report: Jan 10-16, 2022 - BTC, ETH, DOGE, FTM, ADA & More
Market Fundamentals Analysis
The week has been pretty range-bound for most digital assets. The silver lining remains, that despite the dampened activity, we have seen assets hold convincingly at current levels. Inflows across all major assets have seen a slight improvement over the past week, instilling the belief that the bearish cycle is coming to an end, and investors are looking at the current situation as a favourable one to enter the market. Bitcoin (BTC) and most major altcoins are facing selling at higher levels and buying on dips, indicating the possibility of a range formation.
After being on a downtrend for several days, the market has finally ended consecutive trading sessions in the green. While the gains haven’t necessarily been noteworthy, we would like to believe that the market has started to show some sign of respite. BTC dominance is up to 39.3%, while ETH dominance stands at 19.2%. The overall crypto market capitalization is currently at $2.1 trillion, up 2.5% over the past 24 hours. Bitcoin touched the $51,000 level for the first time since the September 2021 crash and fell in dominance by 0.04%. The fall in BTC hash rate and stricter action on miners might be the reason behind this slump, which had a ripple effect on the wider market too.
Bitcoin has strong support at C$50,500. If the prices hold the support then we can expect a bounce or a relief rally whereas a break below C$50,500 will lead to further downfall and the prices can slide to C$45k levels. ETH has broken the key support of C$4,500 last week and made the low of C$3,715 and started consolidating. The asset has a strong support zone from C$3,750 to C$3,650. If it breaks the support then the prices can further slide to the next support, which is at C$3,250. However, given the recovery, we have seen in the past few days or so, we do think that the trend reversal has begun. Having said that, currently, bulls are buying each dip and bears are selling the top of each rally, suggesting that BTC and altcoins will remain range-bound for some time.
A key highlight of the week has been Musk’s tweet, which suggested Tela would accept DOGE as a means of payment for merchandise. This tweet, spiked DOGE’s price up by 15% on Jan 14th, immediately after the tweet went viral. The asset has gained over 4000% in the last year, and much of its success can be attributed to Mr.Musk.
Altcoins have also been hit by the slump. But looking at it from a long-term perspective tells a different story. Year on year, over the course of 2021 alone, Solana (SOL) was the winner and showed a gain of about 74,000%. GALA followed suit, but by a large margin at 31,000%, whereas The Sandbox (SAND) gained around 24,000%. Polygon (MATIC), Terra (LUNA), Solana (SOL), Fantom (FTM), Kadena (KDA), Harmony (ONE) and Decentraland (MANA), all rallied in the range of 5,000% to 20,000% in 2021. This suggests that investors have started to look at alts as an avenue to drive funds into, creating an alternative investment avenue for themselves. This could also be the reason why we have seen major L1 alts outperform the more traditional crypto assets like BTC and ETH. As digital currencies and other crypto-assets continue to grow and attain their highest values, stablecoins also grow in tandem.
Stablecoins have 9% percent of the total crypto market value and contribute to 61% of the global traded volume in the space. Tether’s (USDT) market cap grew 22.31% from 2020 and went to $78bn in 2021. USDC on the other hand, the second largest stablecoin, grew a staggering 890%, and currently demands a market cap of $45bn.
- Uruguay’s first crypto ATM has been installed in the coastal city of Punta del Este, a major tourist attraction in the region.
- Tesla has started to allow people to buy brand merchandise using Dogecoin.
- Hong Kong's central banking institution intends to establish a regulatory framework regarding stablecoins by 2023-24.
- Tether has added three more Ethereum addresses, holding more than $150 million worth of the Tether (USDT) stablecoin among them, to its blacklist.
- Indian INX exchange reportedly plans to list Bitcoin futures ETF.
Bitcoin Technical Analysis
Bitcoin was trading in a range from C$58,500 to C$64,500. The asset gave a breakout on the downside of the range, early this month and started going down by forming a ‘Lower Top Lower Bottom’ pattern making the low of C$50,290. The asset has made a ‘DOJI’ candle at the support of C$50,500 (September low from where the earlier rally started) and has shown signs of recovery.
Currently, the asset is making a series of small ‘Doji’ candles with low volumes which indicates indecisiveness. If the prices hold the support then we can expect the bulls to resume the up move, whereas a break below C$50,500 will lead to further downfall and the prices can slide to C$45k levels. To further rally, BTC needs to trade and close above the resistance of C$58,500. Falling Moving Average and RSI in the negative territory indicates that the bears still have the upper hand.
For the latest cryptocurrency prices, check out NDAX's Markets page.
Information provided in the weekly market report is for information purposes only and should not be interpreted as investment, legal, or tax advice. Prior to investing, it is very important to evaluate your investment objectives and your risk tolerance carefully. This technical report is not meant to provide guarantees of future performance, and users should not rely on it, as the actual performance and financial results may differ significantly.