The evolution of the market during the past week was quite negative and Bitcoin is now trading just below the level of USD 20,000. What can we expect next? We'll break this down later in the article but first, let's go over the main industry news.
News is one of the factors that impact cryptocurrency price. It is important for every trader to stay up-to-date with the latest developments in the sphere. We’ve hand-picked some of the most interesting ones for you:
A crumbling stock market could create profitable opportunities for Bitcoin traders
Some of the biggest companies in the world are expected to report their 2Q earnings in October, including electric automaker Tesla on Oct. 18, tech giants Meta and Microsoft on Oct. 24, Apple and Amazon on Oct. 26 and Google on Oct. 30. Currently, the possibility of an even more severe global economic slowdown is in the cards and lackluster profits could further add to the uncertainty.
Given the unprecedented nature of the United State Federal Reserve tightening and mounting macroeconomic uncertainties, investors are afraid that corporate profitability will start to deteriorate. In addition, persistent inflation continues to force businesses to cut back on hiring and adopt cost-cutting measures.
Strengthening the dollar is particularly punitive for U.S. listed companies because their products become more expensive in other countries and the reduced revenue brought in from overseas negatively impacts the bottom line. Google, for instance, is expected to grow revenues by less than 10%, down from a 40% growth in 2021.
CoinShares’ Butterfill suggests ’continued hesitancy’ among investors
Minor inflows for digital asset investment products over the last few weeks suggest a “continued hesitancy” toward crypto among institutional investors amid a slowdown in the United States economy.
In the latest edition of CoinShares’ weekly “Digital Asset Fund Flows” report, CoinShares head of research James Butterfill highlighted stand-offish institutional sentiment toward crypto investment products, which saw “minor inflows” for the third week in a row:
Between Sept. 26 and Sept. 30, investment products offering exposure to Bitcoin (BTC) saw the most inflows at just $7.7 million, with Ether (ETH) investment products close behind with $5.6 million worth of inflows. Short BTC products represented the only other notable inflows of $2.1 million.
Tether commercial paper exposure now under $50M — CTO
Stablecoin issuer Tether has nearly completely slashed its commercial paper holdings, with less than $50 million worth of commercial paper units as of Sept. 30, 2022.
Tether chief technology officer Paolo Ardoino made the announcement in an Oct. 3 tweet, adding also that Tether’s United States Treasury bills increased to 58.1% of its total portfolio, up 25.1% from its June 30 figure of 43.5%.
Commercial papers are short-term debt instruments issued by companies, which are often used to finance various business operations, while treasury bills are claimed to be more stable than commercial papers as they offer “zero default risk” since investors are guaranteed to at least recoup the purchase price.
Last week was positive for once with BTC that gained 1.3% on the Binance platform. Prices are now hovering just below the USD 20,000.
The weekly volume was significantly higher than the average level once again, even higher than the previous week. In fact, this is the highest volume ever measured on Binance since its listing in a week.
This week is starting in positive with more than 4%, a MACD and a WaveTrend positive.
Let’s keep a cool head and wait for a proper confirmation, a breakout above the USD 24,000 - 25,000 would be a good start! If BTC were to break the USD 17,500 support level, we could decrease towards USD 13,000.
As usual, when BTC does something, Ethereum follows suit. This time it was not the case with ETH losing 1.3% while BTC increasing the week.
The daily technical situation is now positive with a MACD and WaveTrend also positive. On a 4-hour time frame, the indicators are positive too.
Currently the support zone is holding, if it breaks we could see ETH at USD 750.
Conditional long on LINK
LINK/USDT is now trading at around USD 7.65. If OMG manage to overcome the USD 9.53 - 10 zone and tag 11.38, we’ll open a trade on retracement.
Market sentiment can reverse very easily on cryptos as we just saw this week again. Careful though, as long as we don’t have confirmation, we must base our decision on fact and for now we must be patient.
There is nothing more important for success in trading. Plan the trade and trade the plan! As simple as that. In fact, don't be tempted to take dangerous positions and wait for confirmation.
I'll see you next week, take care of yourself!
Have a great week everyone!