Crypto Weekly: 13 – 19 September 2021
The native tokens of Smart Contract platforms looking to challenge Ethereum for its crown have been generating good returns on investment over the past few months. Upgrades, or hard forks, to these projects have strengthened the fundamentals of some of these platforms and have attracted attention and interest from the market, with many traders eagerly speculating over the consequences of these upgrades.
Nevertheless, just because a project has upcoming upgrades doesn’t mean that prices will be significantly affected. Many factors determine whether an upgrade will impact a project’s fundamentals, such as what functionality or features are added to the network, acceptance from developers, and adoption by the user community.
Investors are cautioned against putting too much stock into the news of a hard fork. Proper research must be conducted to determine whether upgrades will actually cause significant and lasting shifts in a project’s fundamentals or whether it’s just market speculation.
Cardano has completed its Alonzo hard fork, ushering in its long-awaited Smart Contract functionality. The upgrade enables developers to write and deploy Smart Contracts and dApps on Cardano, hopefully fueling further growth for the Proof-of-Stake based blockchain.
Meanwhile, data from ethburned.info has revealed that 210,416 ETH has been “burned” on Ethereum since upgrading to the London hard fork, permanently removing the tokens from the circulating supply.
El Salvador managed to purchase 550 BTC for its treasury during last week’s sell-off, turning the South American nation into a key Bitcoin player to watch in the coming future.
Similarly, Panama will be looking to follow in El Salvador’s footsteps and has formally introduced a bill to the National Assembly of Panama that looks to recognize Bitcoin officially. Likewise, Ukraine, one of the global leaders in Crypto adoption, is preparing to become one of the next countries to make Bitcoin legal tender, signaling the growing international support for the digital asset market.
In contrast, the US SEC’s continued scrutiny of the DeFi sector has continued to grow, with the agency now reportedly officially investigating Uniswap. This news comes on the heels of the SEC’s decision to intend to sue Coinbase over its lending practices, yet another example of increasing efforts by regulators to catch up to Crypto and DeFi as adoption and interest in digital assets only grow.
Weekly Technical Analysis: 13 – 19 September 2021
BTC continues to move sideways, with prices unable to create new lows or new highs. As long as the support level at $44,100 remains intact, the rest of the market should be able to go forward without having to worry about a market correction. However, if BTC continues moving upwards, it will have to successfully break through resistance at $47,000 before an uptrend can be confirmed.
ETH faced a significant correction, and it is unclear what direction ETH will be moving in this week. If support at $3,200 can remain intact, ETH will likely move sideways for some time. However, if ETH is going to recover into an uptrend, it will have to break through resistance at $3,565 and successfully create highs above that level to confirm recovery.
Terra Chain (LUNA)
After setting new all-time highs, LUNA has undergone a significant correction. If support at 1,200 Baht can remain intact, there’s still a chance of Luna returning to challenge the 1,500 Baht level again. Traders are advised to be cautious when entering a LUNA position, as prices have historically been incredibly volatile. Those looking to trade LUNA this week should consider buying when prices fall close to, but not through, the support and sell on the upswing.
SOL’s correction continues, a possible result of sell-offs after Solana successfully set new all-time highs. If support at 4,400 Baht cannot remain intact, traders are advised against entering a SOL position as this could be signaling a lengthy correction for SOL, with no signs of how low SOL prices will go before recovering to recent highs.
Trading and Investment Consideration For The Week
The market as a whole continues to be highly volatile. Even though Bitcoin prices have stopped creating new lows and have seemingly stabilized, BTC’s failure to create new highs makes the future direction of the digital asset market uncertain this week.
The native tokens of Smart Contract platforms continue to generate strong returns, with Polkadot and Terra Chain leading the pack during this period of volatility. Meanwhile, Cardano’s prices have not been significantly affected by its Alonzo hard fork, with ADA prices remaining stable, much like MATIC and BNB. Traders should note, Solana’s trend will likely start to look bearish as traders look to take profit and close their positions and take advantage of the recent price spikes.
The blockchain gaming explosion that took the world by storm earlier this year seems to have halted, with Blockchain gaming tokens seeing a mild correction that puts them back in line with the rest of the market. DeFi governance tokens have not had particularly strong performances, with ETH and BSC DeFi projects yet to undergo strong rallies for any notable length of time. DeFi tokens built on Solana have performed incredibly well in the past few weeks; however, SRM and RAY have both slowed down as SOL’s correction halts their uptrend.
Overall the market remains volatile, with little news coming out that would support a digital asset market rally. The growing adoption of digital assets as legal tender worldwide has had little impact on the market. The market has been aware of these legislative changes for some time now, and old news is unlikely to stimulate the market in any meaningful way.
Due to the high degree of volatility and the constant risk of an upcoming market correction, traders and investors are advised to use caution and their best judgment during this period and perhaps avoid making big short-term moves in order to minimize downside.
*Materials on Bitazza Weekly Newsletter are intended to be used and must be used for informational purposes only. The views, information, or opinions expressed are solely those of the individuals involved and do not necessarily represent those of Bitazza and its employees. The email and the information contained herein is not intended to be a source of advice or financial analysis with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice.
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