Fundamentals and expected events: week 27

Crypto markets:Bitcoin briefly dipped below the $19,000 mark during last week. The correlation with equity markets and risk assets is more than obvious. Bitcoin has already lost over 55% this year and is down 70% from its all-time high last year. The latest wave of sell-offs means a reduction in the crypto market by billions of dollars, which is a significant problem for crypto companies. Recently, Bitcoin withdrawals have been halted by several exchanges, led by Binance, CoinFlex or Celsius and a large cryptocurrency fund Three Arrows Capital defaulted on a $670 million debt to lender Voyager Digital, becoming the biggest casualty of the cryptocurrency crisis. The latest market decline is attributed to a decision by the Securities and Exchanges Commission (SEC), which denied the listing requests of two Bitcoin ETFs, whereupon Grayscale filed a lawsuit against the SEC.

Stock and commodity markets: Stock markets are once again falling into red numbers and remain in their worst half-year trend in decades. Investors fear a rapid slowdown in the economies under the unrelenting rhetoric from central banks about the need to react quickly to combat increasing inflation. The sell-off is hitting all risk asset classes, including the cryptocurrency market. Oil prices, which have risen along with most commodity prices in 2022, fell slightly back now due to fears of a slowdown in US gasoline demand. At the G-7 conference, US President Joe Biden introduced the idea of a single price ceiling for oil for the entire group. Other group leaders welcomed the proposal, saying they would try to find a common framework.

Fundaments and important events: The leaders of the central banks of the Federal Reserve, the European Central Bank and the Bank of England met in Portugal and reaffirmed to tame inflation regardless of the impact on the growth rate of the world’s economies. While there were few new clues in the news, this report comes as another warning that the era of cheap cash that has driven stock prices higher for years is coming to an end. Ukraine is about to unveil a giant plan for its post-war reconstruction, a kind of “Marshall Plan for Ukraine”. It will do so at a two-day conference in Lugano, Switzerland, starting tomorrow. The EU should mainly provide funding for the reconstruction, with an amount exceeding 500 billion euros, or 12.4 trillion crowns. The recovery plan includes a wide list of infrastructure and security projects, green and digital investments and investments in energy diversification. It has been drawn up by Ukraine together with its donors, including the EU. The EU granted Ukraine candidate status in June. The Czech Presidency of the Council of the European Union 2022 has begun.

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Cryptomarkets and marketcap: week 27

BTC / USD

ETH / USD

ETH sailed calmly through our key box and made their way up towards 50EMA. The breakout and subsequent retest of the 50EMA suggests a true move to $1300, which is where the 200EMA is located. As time passes and both the 50EMA and 200EMA keep falling and getting closer, the contact is at increasingly lower price levels, allowing ETH to make smaller moves and break resistance like the 50EMA and 200EMA more easily. As well as breaking out at lower levels to the upside, due to trend lines, important supports are also moving lower and any rejection of price at resistance can mean a deeper drop in price to the downside. Currently, support is now at $650-750 per ETH. Therefore, it is now extremely important for ETH to do something exceptional and start forming supports from the existing resistances. It is still very likely that the price could fall below $800 per ETH.

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.