CRYPTOCIES

Crypto Technical Analysis Report | 22nd-July-2022


After surging sharply over the past few days, the cryptocurrency wagon traded lower on Thursday as investors decided to take some money off the table following a strong rally. But  minimal gains are visible today as most assets are range bound. The market was a mix of  green and red trying to break out. The global cryptocurrency market cap traded to the $1.02 trillion mark, falling more than 3 percent in the past 24 hours.However,  total cryptocurrency trading volume collapsed more than 5 percent to nearly $96.02 billion. It has been seen that, Due to the institutionalisation of cryptocurrencies and digital assets, we have seen fewer excessive liquidations and a gradual decrease in volatility over time.

Despite the July 20 pullback, the market structure of BTC and most altcoins is still showing early signs of a trend reversal. Bitcoin (BTC) briefly extended its rally above $24,000 and  altcoins continued to make smart gains on July 20, but the week’s bullish momentum saw a brief setback after Tesla’s earnings report showed the company selling 75% of its BTC position. While this week’s sharp breakout is a positive sign, analysts were quick to point out that a sustained recovery hinges on a strong performance from Wall Street. Some analysts noted that the rally was largely macro-driven and that Bitcoin’s correlation with NASDAQ remained at an all-time high of 91%. Bitcoin’s strong rally over the past few days has awakened  bulls from hibernation who are dishing out high targets. Analysts have  projected a target of $120,000 by 2023, while Galaxy Digital CEO Mike Novogratz said at a Bloomberg conference on July 19 that Bitcoin could top $500,000 in the next five years. However, analysts remain divided on their near-term expectations and some are unconvinced that the trend has changed. These traders believe the current rise is a rebound from the bear market. On the other hand, some analysts expect the upward movement to continue in the short term. On-chain data suggests the rally could extend to $27,100. BTC bulls are aiming for a $235 million profit from  BTC options expiry on July 22, but a move lower below $22,000 could derail that plan.

ETH price is flat after a week of gains, which directs analysts to call for a short-term pullback  which would be followed by a rally in September when mainnet collapse is supposed to happen. Price action in the cryptocurrency market was largely muted on July 21 as traders took a day to digest last week’s gains and book gains after the biggest recovery rally since early June. Amid speculation as to what fueled the recent rally,  Ethereum Merge has consistently topped the list. The market rally accelerated after a tentative date was set for the mainnet merger on September 19.

According to Yahoo Finance,  Bank of America released its latest survey of fund managers on July 19 and the headline read “I’m so bearish, I’m so bullish.” The report cites investor pessimism, weak corporate earnings expectations and equity allocations at their lowest  since September 2008 and are expected to benefit from the forthcoming weekly options expiration on July 22nd. Global macroeconomic tensions eased on July 20 after Russian President Vladimir Putin confirmed plans to restore flow to the Nord Stream gas pipeline  after the current maintenance period.However, data shows that Germany has reduced its reliance on Russian gas from 55% to 35% of its needs over the past few months.

Technical Outlook:

BITCOIN:

Bitcoin (BTC) Chart | 22nd July 2022
Bitcoin (BTC) Chart

BITCOIN after making the low of $17,567 started consolidating and was trading in a broad range from $18,000 to $23,000. The asset finally gave a breakout above the range and made the weekly high of $24,287. However, the bulls failed to manage the grip on the asset as the asset witnessed some profit booking at higher levels and the prices dropped to $22,340. Currently, BTC is trading well above its 20 Day Moving Average and is trying to take support around $22,500-$23,000. If it holds and sustains above the support then we can expect the prices to further surge up to $28,500.

ETH:

Ethereum (ETH) Chart | 22nd July 2022
Ethereum (ETH) Chart

ETH after taking the support around the crucial level of $860 (Low of 4th Jan 2021) started to trade sideways in a range from $1,000 to $1,275. The asset finally gave a breakout above the range and rallied up to $1,630. Post this move, it is consolidating between $1,600 to $1,450. ETH may face strong resistance at $1,700 (Lows of previous Double Bottom pattern) and we may see some profit booking or consolidation at those levels. Once it crosses and sustains above $1,700 then we can expect it to further rally upto $1,950- $2,000 whereas $1,300 to $1,275 will act as a strong support for the asset.

MATIC:

Polygon (MATIC) Chart | 22nd July 2022
Polygon (MATIC) Chart

Matic has made a ‘Cup and Handle’ pattern with the neckline of $0.63. The asset has given a breakout above the neckline and has rallied up to $0.984. Matic is facing resistance at the 200 Day Moving Average and the psychological level of $1. Currently, the asset is consolidating and trying to make a ‘Bullish Flag’ pattern. Once it breaks and sustains above $0.1 it can further surge up to $1.20 whereas $0.75 and $0.60 will act as a strong support for the asset.

Weekly Snapshot:

USD ($) 15 Jul 22 21 Jul 22 Previous Week Current Week
Close Close % Change High Low High Low
BTC $20,569 $23,165 12.62% $21,877 $19,689 $23,388 $22,431
ETH $1,192 $1,472 23.54% $1,229 $1,019 $1,595 $1,472
MATIC $0.71 $0.91 28.24% $0.72 $0.53 $0.92 $0.80
Cryptocurrency 1w – % Vol. Change (Global)
BitCoin (BTC) 7.22%
Ethereum (ETH) 56.64%
Polygon (MATIC) 80.08%
Resistance 2 $33,000 $1,975 $1.20 $0.60
Resistance 1 $28,500 $1,700 $1.00 $0.45
USD BTC ETH MATIC BAT
Support 1 $23,000 $1,275 $0.75 $0.33
Support 2 $17,500 $1,000 $0.60 $0.25

Market Updates:

  • Tesla sold a significant chunk of its stake in Bitcoin. “As of the end of Q2, we have converted approximately 75 percent of its Bitcoin purchases into fiat currency,” Tesla said in a shareholder letter Wednesday during the company’s earnings report.
  • The Zipmex cryptocurrency exchange on Wednesday blocked users from taking direct custody of their coins, citing volatile market conditions.
  • The UK Treasury has unveiled its proposed digital asset legislation a day before members of Parliament plan to begin debate on the measures.
  • Metaverse gaming firm The Sandbox has hired BrandShield, an online threat detection company, to ensure the safety of crypto wallets and non-fungible tokens (NFTs) on its marketplace.

Disclaimer: This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation, or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness, or reliability of the information, opinions, or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum, etc are very speculative and are subject to market risks. The analysis by the Author is for informational purposes only and should not be treated as investment advice.



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