While the last few weeks have not breathed joy cryptocurrency market, the last few days have turned quite green for the majority of assets. Is the market ready to go higher or is it a simple technical recovery before it starts to fall again in all financial markets? The US indices recovered well alongside a dollar which is in a downward daily trend. This dynamic is part of a context in which the FED is beginning to consider a slowdown in interest rate increases. The time would therefore be appropriate for cryptocurrencies, which, we remind you, are considered risk-enabled assets. In this new crypto weekend update, let’s head over to TradingView to identify the current market situation and what to watch out for in the coming days and weeks.
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First, let’s start this crypto weekend update with an analysis of the total market capitalization. For several weeks, the cryptocurrency market has developed in a tidy between 880 billion dollars and the 944 billion dollars. Completely amorphous, the majority of assets no longer evolved at all. However, in the last few days the market has rebounded as it has been freed from the trio of EMA 13/15/32 where the bearish rejections were multiple. By managing to close above the upper limit of the range that has lasted since mid-September, the market moved very quickly towards the MA 100. This dynamic technical level could act as resistance for the market.
Thus, it will be necessary to monitor the daily closely to see if the market will be able to overcome it. For the moment is daily trend is now bullish. If the capitalization manages to stay above the MA100, the context would be favorable for the emergence of certain cryptocurrencies. In this context is total market value could take the direction of the upper resistance at 1020/1030 billion dollars and if it maintains this momentum, we could even consider a return to the EMA200, which is positioned just below a resistance of approx. 1140 billion dollars.
However, if the buyers do not have enough power to recover the MA100 and the market returns below the upper limit of the range at 944 billion dollars, this would demonstrate the presence of sellers to keep cryptocurrencies in a situation of lateralization. In this context, it will be necessary to monitor the price reaction to the $919 billion which interacts with our trio of EMAs. A rebound could be possible at this level to make it a support and again attack the $944 billion for the fifteenth time. This would maintain the bullish momentum that is building in the near term.
Are altcoins in the same situation?
For altcoins, the situation is different. Total capitalization included bitcoin fluctuations and Ethereum. Here we are only concerned with the development of altcoins. We can see that the MA100 has not yet broken upwards, the price has just reacted to it, will it break free? If it does, the first area where altcoins can react to the downside is the 50% Fibonacci of the bearish retracement. This is a technical level that seems relevant, the price has already reacted to it as support or resistance. In this context, if altcoins manage to take over 392 billion dollarsthe doors would be open to significant increases in certain assets.
Nothing has been decided yet though, no need to sell the bear’s skin until it has killed it. After breaking up the resistance at 378 billion dollars, we must now hope for a low point higher than the previous one. This will confirm the presence of an uptrend on a daily scale for altcoins. You can see that after breaking out of the trio of EMA 13/25/32, the market cap increased before going higher. This dynamic support is in conjunction with 361 billion dollarsit must not be lost if we want to hope for altcoins to return to higher price levels.
A loss of these technical levels would invalidate the first signs of an uptrend in the next few weeks. Thus one back to $346 billion would not be unthinkable. Currently, the total market cap and capitalization of altcoins are giving us signs of a trend reversal. About Bitcoin and Ethereum decides not to destroy it and the dollar loses strength, the context may be favorable for buyers. In this framework, we can establish a target of $440 billion, a resistance that interacts with the EMA200, although it does not materialize on the graph above.
Where is Bitcoin dominance compared to other cryptocurrencies?
While the asset had a very good momentum by soaking up a good chunk of capital from the market, the last few days have been different since Bitcoin dominance declined a few percent in favor ofEthereum as well as some altcoins. Breaking down its dynamic supports which are the trio of EMA as well as MA100, the trend is now bearish. A return of 40.44% cannot be avoided, on the contrary. For Bitcoin to regain strength in the market and soak up capital again, it is simple: register a peak higher than the previous one by breaking the EMA200 upwards, this will likely allow dominance to return to 42.56%, an important technical threshold.
In the current context of a rally in the indices and a possible weakness in the dollar in the coming weeks, Ethereum and altcoins could do well by continuing to register good gains. However, this will not prevent Bitcoin from increasing in value and seeking higher price levels, it just means that capital is more likely to flow into other assets. To better understand the balance of power in the market, let’s now move on to an analysis of the pair ETH/BTCthis will allow us to consider the dynamics that the market will have over the next few weeks.
Ethereum rises sharply against Bitcoin
Compared to last week’s analysis where I rather identified a bearish bias, the market proved wrong when it decided to reverse by going up. Ethereum, against Bitcoin, has overcome a set of technical levels which are the horizontal resistance represented in red, EMA 200, the trio of EMA 13/15/32 as well as MA100. Fast enough, Ethereum heading towards resistance on 0.078 BTC where it is currently located. The challenge is quite simple: to hope for a continued rise in the asset against bitcoin, it will have to get out of this gray area, this would allow it to return to 0.08 BTC.
In this context is bitcoin dominance would continue to fall and at the same time will leave the doors open for nice gains in altcoins. However, nothing is decided yet, it is possible to witness a rejection of Ethereum at this level. Over the next few days, we will have to monitor Ethereum’s ability to stay above its MA100, which is close to the EMA trio. If it fails, it will likely return to the 200 EMA, all bets will be on the rebound or the bearish breakout of Ethereum on the red zone at 0.07 BTC.
What is the situation with decentralized finance cryptocurrencies?
Since September’s analysis of FTX’s DEFI-PERP index, things have changed little except for volume and the position of the POC, which is now at $2540. Several times the index rebounded from the Value Area Low with a nice liquidation during the month of October. For the most part, the price manages to stay above its Point Of Control, which currently acts as support. In the last few days, the EMA trio has recovered and the High Volume Node has been broken on the upside. However, the index is stuck below resistance at $2753. Until it succeeds in closing above this level, it will be useless to hope for higher price targets.
If the index manages to go up and regain the 2753 dollars, two goals could be considered:
- The first technical level where the price could react is at 50% of Fibonacci at $2834
- MA100 at $2930 which the price reacted to a few days ago
If buyers fail to demonstrate their strength over the next few days, it would be a sign that decentralized financial assets are struggling to register a bullish move. In this context, it will be necessary to monitor the POC, as a loss of this level could cause the index to return to the Value Area Low.
Here we are at the end of the weekend crypto spot! After several weeks where the market was amorphous, volatility has returned for several days, to the delight of buyers who had the opportunity to position themselves in the markets during the month of October. Over the next few days, we invite you to closely monitor the balance of power between Ethereum and Bitcoin, as well as the dominance of the latter. This will help understand where capital tends to go if there is upside potential for altcoins. But for the latter, don’t forget that they develop below the MA100. If they manage to overcome that, the situation could get interesting during the month of November. So remember that nothing has been decided yet. Do not forget to monitor the development of the US indices and the strength of the US dollar, they will allow you to anticipate a potential return of sellers or the continuation of the rise in the financial markets.
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