Markets do not favour uncertainty, in which sense, capital preservation currently plays a more important role from returns on capital. Last week there was a further decrease in the value of both equities and crypto currencies, but the only assets that gained in value were US Treasury bonds. Capital flow currently goes to Treasury bonds as a means of capital preservation, while real returns still remain in a negative territory, considering widening inflation. In a current economic environment in developed countries, where economic indicators are pointing to high potential for a recession, it might take some time until market sentiment turns to positive.
BTC started the previous week by testing a support line at $20K. Highest level reached during the week was $21.4K, but without much market strength to move the price to the higher grounds. During the whole week BTC was traded with dominant selling orders. The price was pushed further to the downside, ending the week modestly above $19K.
Lowest weekly level was at $18.5K. As of the weekend, the Relative Strength Index was pushed down to the oversold territory, one more time since the middle of June. Moving average of 50 days continues to diverge from its MA200 counterpart, indicating that cross is not in store for this coin for some time in the future.
Macro fundamentals in the U.S. continue to be the primary driver of the crypto market for some time now. It will also continue in the future. During the week ahead FOMC minutes will be released as well as non-farm payrolls and unemployment rate for June. In the case that any of these indicators surprise the market and imply a potential for further FED tightening of monetary policy, markets might react in a negative way. It should also be noted that the ECB meeting is also in a week ahead where it is expected that the ECB will increase interest rates and comment on the current state of the EU economy. As per current charts, RSI is pointing that reversal is ahead for BTC, in which sense, the coin might return to levels above the $20K support line. In case of a surprise in fundamentals, BTC has currently equal probability to move down to $18K next support line to test it.
BTC started the previous week by testing a support line at $20K. Highest level reached during the week was $21.4K, but without much market strength to move the price to the higher grounds. During the whole week BTC was traded with dominant selling orders. The price was pushed further to the downside, ending the week modestly above $19K.
Lowest weekly level was at $18.5K. As of the weekend, the Relative Strength Index was pushed down to the oversold territory, one more time since the middle of June. Moving average of 50 days continues to diverge from its MA200 counterpart, indicating that cross is not in store for this coin for some time in the future.
Macro fundamentals in the U.S. continue to be the primary driver of the crypto market for some time now. It will also continue in the future. During the week ahead FOMC minutes will be released as well as non-farm payrolls and unemployment rate for June. In the case that any of these indicators surprise the market and imply a potential for further FED tightening of monetary policy, markets might react in a negative way. It should also be noted that the ECB meeting is also in a week ahead where it is expected that the ECB will increase interest rates and comment on the current state of the EU economy. As per current charts, RSI is pointing that reversal is ahead for BTC, in which sense, the coin might return to levels above the $20K support line. In case of a surprise in fundamentals, BTC has currently equal probability to move down to $18K next support line to test it.
