In this new crypto point of the weekend, like every Sunday, we will focus on the overall situation of the Bitcoin and cryptocurrency market by determining the bias to have, the technical thresholds to watch and what happened on the class for the last 7 days. This will allow us to take a step back from our previous analysis by asking ourselves whether the scenarios that were established have been confirmed or not.
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Cryptocurrencies touch the 1000 billion capitalization mark
Last week, we discussed the resumption of technical resistance at $780 billion (not shown here) which was the first stage of an upward trend reversal. Having managed to regain the 800 billion dollars and then the resistance at 845 billion in confluence with the MA100, the buyers managed to operate a short squeeze which resulted in a very powerful bullish movement.
The price of the capitalization of cryptocurrencies reintegrated the previous range by also regaining the pivot level which was built from September to October 2022, which paved the way for a return to the EMA200 which the price had not found. since last April! Although this rise is very interesting, it should not lead you to lower your guard vis-à-vis the financial markets.
We are on a technical confluence that is the daily EMA200 where is located just above a technical resistance at 980 billion dollars. However, it is important not to rush and mindlessly FOMO current levels although they may be, depending on your investment thesis, quite attractive over the long term. Consolidation with a pullback is possible, but how far? In order not to break the dynamic, the capitalization of cryptocurrencies could come back up to 850 billion dollars in order to confirm the bullish exit from the range in which prices have been evolving since November.
Altcoins late?
Regarding the capitalization of altcoins (excluding the capitalization of Bitcoin and Ethereum), we can see that the price is lagging since they have not reached, for the moment, the daily EMA 200. Currently, the altcoins have broken free from a technical confluence that is the MA 100 and the resistance level at $332 billion on which the price continued to be rejected downwards in November and December.
Currently, the price is below the support at 350 billion dollars on which the price was maintained from June to October last. For the moment, since the daily momentum is bullish, there is no doubt that a re-entry of this support will open the way for a more sustained rise in altcoins which could take advantage of it to return to the 200 EMA which is currently in confluence with a pivot zone at $375 billion.
Here are the two technical levels that the altcoins will have to take back if they wish to return to the resistance represented in red at 400 billion dollars. For the moment, nothing is decided yet despite the powerful momentum we have experienced in recent days. To avoid a bearish reintegration of altcoins with the manifestation of sellers, the ideal scenario would be to preserve the price above $332 billion so as not to fall below the MA 100.
A Bitcoin that once again demonstrates its strength against other cryptocurrencies
Regarding Bitcoin dominance, what has happened in recent days is very interesting since the bearish scenario took place before giving way to the realization of an upward trend in the price of dominance. As agreed, price has reversed to the MA100, which has triggered a very strong start for Ethereum and altcoins. A large number of cryptocurrencies recorded double-digit increases. The liquidity that was going to Bitcoin gradually moved to the rest of the market.
However, a very powerful rebound took place in Bitcoin which decided to recover as the market leader. Although altcoin prices have pushed higher, that hasn’t stopped the king of cryptocurrencies from sucking up a bigger chunk of capital, giving him the chance to return to $21,000 in a matter of seconds. A few days.
Arriving at a key level, it is possible to witness a decline in Bitcoin’s dominance for some time. This would be an opportunity for the cryptocurrency market to take a break in order to achieve a technical pullback which is necessary if we want a continued rise in the market.
Ethereum is still moving in the same technical zone
Regarding the situation of Ethereum against Bitcoin, we can see that the price is still moving in the upper zone of the range that has been building since April 2021. For the moment, the price is unable to overcome the upper limit of the range at 0.0789BTC, especially since a second resistance at 0.0769BTC is located just below. If Ethereum manages to overcome this double resistance, the price will probably head towards 0.085BTC.
It’s kind of the current issue for buyers who hope to see a powerful rise in price. An upward breakout of the range would be an opportunity for Ethereum to lead the market and outperform Bitcoin. This would be an ideal backdrop for altcoins which react more favorably to a rise in Ethereum compared to rises in the king of cryptocurrencies. However, if the price fails to do so and loses its 3D trend with its trio of EMAs, the way would be open for a return to the MA100 and an outperformance of the asset against Bitcoin.
Decentralized finance in great shape
Regarding the capitalization of DeFi cryptocurrencies, the objectives mentioned last week have largely been achieved since the price has returned to the range in which it evolved between September and November 2022. Reacting on a pivot zone at 44 billion dollars, the price now has a major objective: to stay in the range by staying above the lower limit of 40 billion dollars.
If this target is achieved, it would be a sign of strength in DeFi assets, which should alert investors to the need to monitor cryptocurrencies operating in this sector. The second issue is a resumption of the pivot zone that we have mentioned. If the price breaks this zone upwards, it could move towards the EMA 200 where the upper limit of the range is located at 48 billion dollars.
Here we are at the end of this technical analysis. This week has been very emotional and the one that will follow risks being in continuity since the market will have to choose between, on the one hand, the continuity of a bullish momentum which is favored by a rather weak dollar or On the other hand, a trend reversal that could be set up by marking a local top on the current levels. What is certain is that the rise we have just experienced is powerful and for it to continue, a pullback will have to be marked.
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