Week 17 – Fundamental and technical analysis

Fundamentals and expected events: week 17

Crypto markets: The week did not start well for most cryptucurrencies. With only a few exceptions the markets are deep in red numbers, lead by Bitcoin and Ethereum. The crypto market cap is down by about $80 billion in a day and struggles beneath $1.8 trillion. Bitcoin fell to its lowest price point in over a month. Ethereum is also deep in red and well under $3,000. On the other hand, PlatonCoin is in green with gains of more than 4% in a day, proving its independence on the crypto market.

Stock and commodity markets: Major Chinese stock markets weakened significantly overnight today as Chinese markets are worried about the negative economic impact of further covid developments in the country. U.S. stocks continued to fall last week on fears of more aggressive Fed monetary tightening as well as disappointing economic results from some companies. Overall, this is the third week in a row that US stocks have lost ground. European stock markets are weakening significantly as well at the start of the new week. The markets were globally spooked at the beginning of the new week by the unfavourable development of the coronavirus situation in China, which raises concerns about the pace of growth of the local economy and its impact on global economic development. Oil is weakening due to the situation in China and gold prices also headed lower due to stronger USD.

Fundaments and important events: Global markets are nervous at the start of the new week. The nervousness is not only about the tightening of US Fed policy, but also about the so-far not-so-positive US earnings season and the ongoing coronavirus lockdowns of some major cities in China and the associated continued disruptions in global supply. On a slightly positive note, E. Macron has defended his presidency in France. This week, 160 companies from the S&P 500 index will present their results and we can expect several important macro data from Japan and United States.

Tip: What are the most common crypto scams?

Cryptomarkets and marketcap: week 17

BTC / USD

The space that BTC has created for movement in both directions was very evident in the last 3D TF analysis and we will use it again this week. BTC has currently made it to the bottom of the channel and is testing the 200EMA on the 3D TF. It is very likely that 38k will now be key support, below which we would not want to close the 3D candle. And a move to 44k, which is where we will decide if we head to $50k for BTC, is now imminent. The 50EMA and 200EMA, along with the key TL, now form the boundary between a move up or a break of support. The $37400 BTC boundary holds for now and we can still view BTC from a bullish perspective.

ETH / USD

We just mentioned last time that ETH is teetering on the edge of the precipice, so over the last week ETH has only confirmed it. We have currently broken key support, but there is still hope that we will close above that support and then it would be a fakeout. With ETH, the situation around support is not as obvious as it is with BTC, where it looks more like a bounce up. What is positive with ETH is that as of Jan 22, 2022 we are still forming a higher low and higher high on the 3D TF. ETH also reached the golden zone today and with support from weekly supports we could see a positive reversal from what has been happening in recent weeks. Anyone betting on another deeper drop now could be disappointed. One more green daily candle and we are whipsawing up. We’re moving key support to the $2500 level.

Disclaimer: This is not an offer for concluding a contract. Trading cryptocurrencies is a highly risky business and as such you are the only person bearing the risk and responsible for your own decisions. Do not engage in trading unless you do your own research and are fully knowledgeable of the risks.

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