The evolution of the market during the past week was completely negative and Bitcoin is now trading just above the important level of USD 32,000. 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 prices. 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.
The third-largest stablecoin by market cap Terra USD (UST) appears to be in a catastrophic tailspin which has seen it de-peg from the dollar and drop to as low as $0.67 on May 10.
As its price has fallen, so has its market capitalization along with that of Terra (LUNA) which backs the majority of the value of UST. Adding further insult to injury, the market cap of UST has vastly surpassed that of LUNA, drawing extreme scrutiny from the crypto community.
According to blockchain digitization provider Tokeny, on Monday, the Royal Museum of Fine Arts Antwerp (KMSKA) became the first European museum to tokenize investment in fine art, starting with Belgian painter James Ensor’s (1860–1949) painting, “Carnaval de Binche.” Investors can obtain fractional ownership of the work starting from 150 euros (or about $158). The venture is a joint effort between KMSKA, Tokeny and blockchain art entity Rubey, with the tokens, themselves, being ERC-3643 compliant and launching on the Polygon (MATIC) blockchain.
As told by the parties, the ultimate goal of the collaboration is to lower the investment barriers to entry and enable everyday users to become co-owners of expensive fine art pieces that are typically only accessible by affluent individuals. Via an innovative fundraising method, an Art Security Token Offering, individuals were able to collectively purchase and ensure that KMSKA receives it on a long-term loan.
Cryptocurrency investment manager Galaxy Digital Holdings reported a sharp loss in the first quarter due to unrealized losses in its digital asset portfolio, underscoring heightened volatility in the digital asset sector in 2022.
Galaxy Digital reported a net comprehensive loss of $111.7 million in the quarter ending March 31, compared to a gain of $858.2 million in the same quarter of 2021, the company announced Monday. In addition to unrealized losses in its digital asset portfolio, Galaxy’s overall losses were also attributed to investments in its trading and investment businesses.
Bitcoin ended the past week just above its support zone just above USD 33,000. This now makes the sixth consecutive week with BTC in the red, which has never happened since the listing on Binance in 2017. So we are in a situation of extreme risk aversion in the markets.
The classic markets are not left behind and are also recording significant losses, although much smaller than the crypto market, which is more volatile.
There is still hope that we will not see BTC at USD 20,000 if the USD 28,000 area holds up. For now, of course, there are no long positions to open, and caution is advised.
As usual, when BTC catches a cold, Ethereum sneezes too. ETH is now trading below the USD 2,500 level.
Like BTC, it has not yet dropped below its last support level before a huge drop.
The daily technical situation is negative with MACD and WaveTrend completely bearish with no prospect of reversal. On a 4h time frame, the indicators are neutral with a buy signal on the Wavetrend and a still bearish MACD.
The EOS/USDT pair fell over the weekend as did the entire market.
We can now look to open a short position on retesting the area between USD1.90 and USD2.
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, stay safe and take care of yourself!
Have a great week everyone!