Crypto Predictive Market Analysis — Week of January 2, 2022
The year 2021 has indeed been remarkable in the crypto space, bitcoin closed the year below $50,000. Bitcoin has had a tough time since reaching its all-time high in November 2021, which has been worsened by fears about increased regulatory scrutiny throughout the globe.
Bitcoin reached an all-time high(ATH) of $69,000 and it failed to reach $100,000 that many investors have predicted.
A lot of institutional investors are not selling their large-cap coins because of a small market downtrend, according to charts.
On-chain data from CryptoRank shows that the total Bitcoin on crypto exchanges has dropped from 9.5% of the total Bitcoin supply in October 2020 to 6.3% of the supply in December, which is the lowest level in 2021.
Bitcoin Analysis:
At present, the bitcoin dominance is 34.03% and the total market cap of the crypto market is $2.3trillion.
December was a tough month for the price of bitcoin, recording a monthly low on December 4th just below $42K, according to Bitstamp.
Bitcoin’s (BTC) price has been moving sideways between $46,000 and $52,000 for 26 days. Bitcoin’s $6.1 billion options expiry was not enough to break the bearish sentiment
Bitcoin has two support zones the first one is $45,500 and the second is $41,750, if bitcoin stay above the $42k support level, there would be a gradual increase which would lead to another bitcoin rally.
The United States publicly listed tech company MicroStrategy added another 1,914 BTC to their balance sheet on Dec between 30th, 2021. This announcement might bring bullish sentiment to the market. The first
However, if bitcoin could break below the $42k support level, then the market will experience a bear market for some time.
While El-Salvador has been the country blazing the trail of Bitcoin adoption as a legal tender, reports have it that the usage of Bitcoin has dropped by 89% in the country.
Current correspondence affirmed that this drop was due to recent hacks that happened in the country. Hence the reason the people are more skeptical about the use of Bitcoin.
Also regulation continues to pressure the markets as South Korean exchanges require users to verify their third-party wallet addresses to comply with the Financial Action Task Force (FATF) travel rule guidelines.
Ethereum Price Analysis:
At present Ethereum has suffered a big blow which pushed the price below $4,000 and the worst support is at $3,300. At present, the ethereum dominance is 18.89% which is still good.
The coin price breaks below the 50 days EMA, but the 200 days EMA stands strong as the last line of defence against the ongoing bearish attack.
The price action of Ethereum suggests the nearest resistance level is at $3900 and $4,250 that can influence the upcoming trend. Furthermore, the support levels are around the $3,500 mark and $3,400 level.
If bitcoin could recover and move to break $53k resistance, ethereum could also experience a massive rally.
However, amid the market downtrend, a lot of altering suffered massive sell-off, Polkadot, Tron and Filecoin are down by 57% from their previous all-time-high (ATH) so also other coins such as LEO and VET which are 55% down from their all-time-high (ATH).
AVAX is having support at $101 and the resistance at $147. Sideways trading is also confirmed by the low trading volume. If AVAX keeps trading above $110, there is a possibility to see $150 shortly.
Lastly, the market generally is down as there is a high level of fear in the market which scares both traders and investors.
The market needs a bullish announcement to bring back the bullish sentiment.
In next week the market will witness some corrections and some sideways movement for some time. Before the end of January, there is a possibility of a sudden rally in the price of bitcoin which may kick start the bitcoin rally.
Summary
President Bukele gave his Bitcoin 2022 price prediction on Twitter. He said bitcoin would reach the long prophecied target which is $100,000 and 2 more countries may adopt bitcoin as a legal tender.
The year 2022 looks more promising as more institutional investors are coming to the crypto space with heavy funds. The boom of Nft, Metaverse and Defi would make more money flow into the market.
A popular crypto YouTuber named Coin-Bureau also made a video where he remarked that the blackhat hacks in 2022 will be greater than the ones that have happened in 2021.
On this note, he encouraged people to keep their passwords and other security issues seriously. Not only individuals, but also DAOs, protocols, and exchanges.
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