Market Update
For the most part, major cryptocurrencies look set to end the week with solid gains and near highs. Bitcoin was last consolidating in the $21,500 area, up around 12% so far this week. That means its market capitalization currently stands at around $413 billion.
Ethereum, meanwhile, was last trading well supported in the $1,220 area, up roughly 14% this week. The market cap of the world’s second-biggest cryptocurrency was last just under $150 billion. Total crypto market cap was last around $935 billion, up roughly 10% or over $80 billion on the week.
Sentiment took a turn for the better this week despite a rise in US yields and Fed tightening bets on strong US jobs and service sector survey data. US tech stocks, to which crypto prices have developed a close correlation in recent months, posted solid gains this week.
The Nasdaq 100 ended the trading week over 4.5% higher. There seems to be a growing conviction that the US and global economy is weakening towards recession and this will bring inflation back under control.
This conviction is already in the early stages of becoming a self-fulfilling prophecy, with commodity prices down sharply in recent weeks nearly across the board. This may be attracting investors back into speculative assets, despite still elevated concerns about Fed tightening and the macroeconomic backdrop.
The narrative of inflation having peaked will be tested next week with the release of US Consumer Price Inflation data. An upside surprise could see crypto prices swiftly hand back recent gains.
Here is a list of this week’s five most popular cryptocurrencies outside of the big two.
Solana (SOL)
Solana, the world’s ninth-largest cryptocurrency by market cap, garnered the fourth most social mentions and engagements in the last week at 905K and 1.14 billion respectively, according to crypto social intelligence platform LunarCrush.
SOL/USD was last up about 15% versus this time last week, according to CoinMarketCap. At current levels around just above $38 per token, its market cap is just over $13 billion.
The pair is still consolidating within a pennant that has been in play since early June. A downside break (perhaps triggering a move under $35) would signal a potential drop all the way back to annual lows near $25. An upside break could open the door to a rally towards the key $47.50 support turned resistance area.
Dogecoin (DOGE)
The crypto community’s favorite dog-inspired meme coin Dogecoin ranked as the number five cryptocurrency for social mentions and engagements in the last week, according to LunarCrush. The cryptocurrency got slightly more than 300K mentions and 911 million engagements.
Dogecoin bulls have mostly been in control this week. DOGE/USD was last up about 3.5% versus the start of the week, meaning it is a laggard compared to the likes of Bitcoin and Ethereum. The pair was last trading close to $0.07 per token, having pulled back sharply from Friday’s highs around $0.0735.
The cryptocurrency ran into resistance in the form of its 50-Day Moving Average at $0.072, snapping bullish momentum at the time. That is the second time in less than two week’s that the 50DMA has spoiled the party and blocked DOGE upside.
Bear in mind that the 50DMA currently also coincides with a downtrend that has been in play since mid-May. The fact that DOGE remains unable to break out of this bearish trend means the technical outlook for the pair isnt great, unless it can muster a breakout above say the $0.075 area.
Shiba Inu (SHIB)
The crypto community’s second favorite dog-inspired meme coin Shiba Inu ranked as the sixth cryptocurrency in terms of social engagements, clocking 489 million in the last week, according to LunarCrush.
The Shiba Inu bulls have been in control this week. The cryptocurrency has been an outperformer and was last up about 17%, extending on a recent rebound from the $0.000010 level to test resistance around the $0.000012 mark on Saturday.
Shiba’s technicals are looking pretty bullish. Since mid-June, the cryptocurrency appears to have formed an ascending triangle. This is a pattern that often precedes a bullish breakout.
If SHIB is able to muster a convincing push above $0.000012, the door is open to a run higher towards the late-May highs between $0.0000125 and $0.000013.
Tezos (XTZ)
Tezos ranks third according to LunarCrush for social engagements this week with over 1.15 billion. The cryptocurrency was last trading higher by about 5.0% on the day on Saturday around $1.60. But it has pulled back from earlier session highs in the $1.65 area, having failed to test late June highs and have a go at its 50DMA near $1.70.
But the pair’s technical outlook is looking strong. It has been forming an ascending triangle in the last few weeks. A break above this formation (i.e. a move above $1.70) could trigger a swift run higher towards the $2.0 level, given a lack of resistance in between.
Aave (AAVE)
According to CoinMarketCap, Aave’s AAVE token is the best performing cryptocurrency in the top 50 by market cap over the last seven days, having gained over 32%. AAVE/USD was last changing hands just under $75, having gained another 4.0% alone this Saturday.
Momentum really picked up when the pair broke above its 21DMA at $63 back on Thursday. The cryptocurrency is currently probing its late June highs. A break above these and the 50DMA just under $80 could set the stage for a swift rally back towards the $90 level and even $100 mark, given the lack of resistance in between.
