Crypto Weekly: 12 – 18 September 2022
Ethereum developers have confirmed the successful deployment of the Ethereum mainnet’s 13th shadowfork, the final trial before Ethereum finishes its transition from PoW to PoS.
Google Trends data indicate that Bitcoin searches have hit a 2-year low. In contrast, queries regarding the Ethereum Merge have hit an all-time high, particularly over the past month where it became apparent that the Ethereum upgrade would not see further delays.
FED Chair Jerome Powell has publicly called for greater clarity and regulations over stablecoins, opining that greater transparency is needed for the protection of consumers. Powell highlights that full reserves of very liquid, high-quality assets are necessary and shouldn’t be perceived as an effort to thwart innovation. News of a FED-issued CBDC remains quiet, with insufficient support at this time from legislators.
Binance has announced that USDC, USDP, and TUSD will no longer be traded at the exchange and that deposits of the aforementioned stablecoins will be automatically converted to BUSD, Binance’s own stablecoin and the third-largest stablecoin by market capitalization.
According to a document filed with the SEC, MicroStrategy has entered an agreement to sell $500 million worth of its aggregated class A common stock with the intention of reinvesting proceeds from the stock sales in acquiring more Bitcoin. Despite current market conditions and MicroStrategy’s alleged over-$900 million loss on its Bitcoin position, new CEO Phong Le seems to maintain his predecessor’s belief in Bitcoin’s long-term potential.
Terra Classic (LUNC) soars as notable exchanges like KuCoin and Gate IO extend their support of the LUNC tax burn plan. The new 1.2% tax proposal will charge and burn LUNC on all transactions in a bid to turn LUNC into a deflationary asset. This has fueled increased speculation surrounding LUNC and LUNA, with prices moving accordingly.
Data from DappRadar indicates that DeFi Dapps are showing signs of recovery, with a 3.7% increase in terms of daily average unique activated wallets month-over-month. This is the first time month-over-month UAW has grown since May, with the growth mainly driven by Flow Protocol, die to the support of Flow-based NFTs into Instagram. Notable, Solana UAW has declined sharply from previous months, with the number of transactions dropping similarly.
Weekly Technical Analysis: 12 – 18 September 2022
Bitcoin (BTC)
BTC rallied after the key support at $18,900 stood strong. BTC will look to initially target resistance at the $22,300 level with an EMA100 at $23,700. Support level is set at $18,900. Due to the number of significant events this week that could affect the market, BTC prices may be highly volatile.
Ethereum (ETH)
ETH is showing signs of entering an upwards recovery as ETH prices continue to remain above the 100-day EMA. However, to confirm its uptrend, ETH prices will have to break through resistance at the $2,000 level. Support is set at $1,400.
Terra (LUNA)
LUNA is up by +216.8% from last week; however, these prices do not reflect any meaningful changes or improvements to LUNA’s fundamental value. Exercise caution when trading LUNA. Support is set at 160 THB, with resistance at LUNA’s original high of 260 THB.
Terra Classic (LUNC)
LUNC is up by +72% from last week. Its short-term uptrend remains intact; however, investors are advised to trade with caution and discipline as the Terra Classic ecosystem is still lacking long-term stability and fundamentals. Support is at 0.012 Baht, with a resistance level target of 0.022 Baht.
Trading and Investment Considerations For The Week
Over the past week, Jerome Powell and the FED reiterated their stance on further tightening US monetary policy to continue its fight against inflation. The FED’s hawkish comments pushed Bitcoin prices down before a weakening Dollar Index allowed prices to recover.
Ethereum’s “The Merge” upgrade has entered its final stages. While transitioning, Ethereum’s trading volume may not see a significant increase until a successful upgrade is confirmed. Following a successful shift to PoS, the market could potentially see both increased selling pressure with investors looking to take profit and sell on fact, as well as a large number of investors looking to enter Ethereum positions; therefore, prices may fluctuate.
On 13 September, August’s CPI figures will be published, which will reveal whether the rate of inflation is slowing down. Analysts are largely forecasting an 8.1% rise in CPI, down from July’s 8.5% figure.
Regardless, with crude oil prices falling below levels preceding the Russia-Ukraine invasion, many are optimistic that this will alleviate fears regarding inflation, with the worst having already come to pass.
Additionally, on 15 September, Mt. Gox is set to begin distributing its Bitcoin repayment to its creditors. The exact details of the repayment and its terms remain unclear at this time; however, we could see an increased portion of BTC being sold off, but this volume is likely to be insufficient as to affect the overall market significantly.
Disclaimer: Cryptocurrency is highly risky; investors may lose all investment money. Investors should study and verify information carefully and make investments according to their own risk profile.
*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 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.
Sources:
https://www.theblock.co/post/168615/powell-we-need-legislation-on-stablecoins
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