Bitazza Crypto Weekly: No Raise In Interest Rate From FED Helps Crypto Market -

Crypto Weekly: 30 August – 5 September 2021

At the annual Jackson Hole Economic Symposium, Federal Reserve Chairman Jerome Powell reiterated that an increase in interest rates is unlikely to accompany the anticipated tapering of Quantitative Easing (QE) that will gradually take place over the rest of this year.

Following the conference, the price of Store of Value assets like gold and Bitcoin rose as the dollar weakened in response to the announcement.

Now that the FED has clarified the direction of upcoming monetary policies, fear and uncertainty that arose in the market following speculation around potential crypto-related actions should decrease. It is important to note that historically Bitcoin prices have had a relatively low correlation to the dollar’s performance compared to gold despite both being Store of Value assets.

Despite Bitcoin prices steadily rising, MicroStrategy continues to double down on Bitcoin and has continued to purchase an additional 3,907 BTC at an average price of $45,294. As of now, MicroStrategy holds 109,000 BTC acquired at an average price of $26,769 per Bitcoin.

Similarly, PayPal has announced the launch of its cryptocurrency service in the UK. PayPal customers in the UK will now be able to use the platform to trade cryptocurrencies, expanding PayPal’s crypto offerings beyond just the United States.

Meanwhile, the total value locked (TVL) across DeFi protocols has reached an all-time high at $157.06 Billion. DeFi’s previous peak was earlier this year in April, when Bitcoin and Ethereum were both at all-time highs.

This surge in TVL has been fueled by new DeFi protocols hitting the market and the continued development and growth of established players in the DeFi sector, such as UniSwap. Additionally, alternative Smart Contract platforms such as Solana, Polygon Network, and Terra Chain have started gaining significant shares of the market, reflected by the growth in price of their respective Governance tokens.

Weekly Technical Analysis: 30 August – 5 September 2021

Bitcoin (BTC)

BTC prices have begun to move sideways after failing to create new highs above the $51,000 level. So far, support has remained intact. Many traders are buying Bitcoin when prices approach support level, which has lifted the lows despite BTC failing to create new highs. Overall, indicators suggest that the uptrend has lost its strength, and traders should carefully monitor BTC movements and remain wary of a possible upcoming correction.

Ethereum (ETH)

ETH has been moving sideways for some time and has established strong support at $3,000 despite not being able to break through resistance at $3,400. Overall, ETH has not lost its uptrend in the medium-term yet, and traders can follow a channel trading strategy this week if they so choose.

PancakeSwap (CAKE)

CAKE has been in the midst of a steady uptrend that has been consistently growing, making it a good token for traders looking to avoid purchasing tokens that have had dramatic swings. When entering, keep a close eye on the 760 Baht support level and resistance at 960 Baht.

Terra Chain (LUNA)

LUNA is continuing to successfully create higher highs, but its price is rising rapidly, making timing an appropriate entry difficult for traders looking to purchase LUNA. If the support level at 850 Baht can remain intact, look for the uptrend to continue with LUNA hopefully challenging resistance at the 1,300 Baht level this week.

Trading and Investment Consideration For The Week

Overall sentiments coming out of the Jackson Hole Economic Symposium have mainly been positive following the FED’s announcement that they will not raise interest rates. Despite this, traders and investors are cautioned against putting too much faith in Bitcoin as prices are already beginning to move sideways following Bitcoin’s rally over the past weeks.

If Bitcoin can continue to move sideways without entering a downtrend, the altcoin price speculation is likely to continue. However, despite the overall positive performance of altcoins, the digital asset market still hasn’t returned to peak levels as seen during the first quarter of this year yet.

Recently the altcoins that have been performing well are the governance tokens of Smart Contract platforms, as well as gaming or NFT-related tokens. When choosing which tokens to buy, traders should consider picking tokens that have already demonstrated their ability to outperform the market and buy during the rally whenever prices dip.

Tokens that are just beginning to see reversals into uptrends will have significantly greater upside and potential returns, as well as lower downsides and risks than tokens that have already set new highs.

That being said, traders are advised to remain cautious of a potential Bitcoin correction. As the digital asset market leader, if Bitcoin starts to recede, it may pull down other altcoins with it. Therefore, traders should begin to consider reducing the amount of money in their portfolio that they are actively trading with on the digital asset market and figure out how to hedge their risks accordingly. Now is perhaps a good time to figure out where your appropriate exit points are, either to minimize losses or to secure profits in the event that the market sees a correction soon.

*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.

Post Views: 1,060