Weekly Crypto Analysis: BTC at a Crossroads as Investors Wait for the US to Chime In
The crypto market is at a crossroads yet again, with a lot depending on next week’s news coming from US President Joe Biden’s upcoming executive order on cryptocurrencies. The market is currently playing in preparation mode, waiting for any significant news to tip the scale to one side.
Crypto Market Overview
Most of the crypto sector ended the week in the red, led by Bitcoin’s drop of 6.86%. Analysts speculate that the recent wave of sellers came as a result of investors’ uneasiness due to Canada’s hostility towards cryptocurrencies, as well as the upcoming executive order on cryptocurrencies coming from the US.
Cryptocurrency Market Heatmap | Source: Coin360
The overall cryptocurrency market capitalization is currently sitting at $1.77 trillion, a $95 billion drop from the previous week. The market’s daily volume has remained stable through the week, slowly increasing from $45 billion to over $50 billion.
Top Altcoin Gainers and Losers
Top Altcoin Gainers:
· Neo (NEO) ➠ 11.39%
· Rally (RLY) ➠ 11.16%
· Klaytn (KLAY) ➠ 7.02%
· Waves (WAVES) ➠ 4.54%
Top Altcoin Losers:
· The Sandbox (SAND) ➠ 16.37%
· Elrond (EGLD) ➠ 14.42%
· Flow (FLOW) ➠ 13.64%
· Crypto.com Coin (CRO) ➠ 13.58%
Here are some of the events that highlighted the previous week’s crypto news section:
US President Joe Biden to Issue Executive Order on Cryptocurrencies
US President Joe Biden is reportedly expected to issue an executive order on cryptocurrency this week, with the aim of directing a wide range of government agencies to do extensive research and come up with a strategy to regulate crypto assets.
The news reportedly came from an administration official familiar with the matter. The report states that various government agencies will be asked to produce a report on the current state, as well as the future of money and payment systems, including the Departments of the Treasury, State, Justice, and Homeland Security. The report also mentioned institutions such as the Federal Trade Commission, the Financial Stability Oversight Council, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve, and more.
FBI Launches a New Cryptocurrency Crimes Unit
Last week, the Federal Bureau of Investigation (FBI) launched a unit with the goal of handling crypto exploitation. The new unit’s aim is to focus on crypto-related matters, with Eun Jon Choi as its first director.
The US government also announced that it will look at coordinating with other countries to standardize crypto rules and regulations.
Charlie Munger Gives his Opinion on Crypto
Warren Buffet’s right-hand man came out with some rather negative comments on cryptocurrencies as an asset class, which contributed to the sudden crypto spike towards the downside.
Munger compared cryptocurrencies to “some venereal disease,” stating that he clearly missed out on investing in crypto, but that he wasn’t at all shaken.
Crypto Adoption is Growing
Numerous bullish news regarding crypto adoption has appeared in the media. Twitter has enabled its users to accept tips denominated in Ether natively, Ukraine has passed a bill to legalize cryptocurrencies, and Bank of America has announced its bullish outlook on crypto (specifically Chainlink).
All the aforementioned events are clearly adding to the fundamental outlook of the crypto market - however, the price hasn’t shown any movement to the upside due to bearish news trumping the bullish ones amid immense FUD coming from crypto investors.
Bitcoin Technical Analysis
Bitcoin has spent the day attempting to push its price up past the $40,000 mark as the market tried to rebound from its sudden drop. The BTC price, however, encountered resistance at the psychological and historical boundary, and bounced back to just under $39,000.
BTC/USDT Chart on the 2-hour Timeframe | Source: KuCoin
The general technical outlook for BTC/USDT is slightly bearish, but Bitcoin still has a good chance to contest the $40,000 mark yet again. If this barrier gets cleared out, it will set a strong support level for BTC.
However, technicals seem to have less of an impact on the market now since news seems to have dictated most of the movement in the past week.
With news slightly tilting towards the bearish side, the Fear & Greed Index has shown a drop from the value of 46 last week to 25 this week, indicating high levels of uncertainty among crypto investors.
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