Technical Analysis

Bitcoin feels the need for correction before further growth


Market picture

Bitcoin rose
5.3% last week to close at $23.8K. On Sunday, the first cryptocurrency was one
step away from $24K, updating its high since August. Ethereum gained 0.9% to
$1640. Top-10 leading altcoins have gained between 2.7% (Dogecoin) and 18.8%
(Polygon).

Total
cryptocurrency market capitalisation rose 4.4% to $1.08 trillion over the week,
according to CoinMarketCap. The cryptocurrency fear and greed index reached the
greed zone for the first time since late March last year.

Bitcoin is
gradually approaching its key moving averages. The 200-week is just above
$24.7K, and the 50-week is now at $24.5K. A break below these levels would be a
strong sell signal. A rebound above them could restore confidence in the crypto
market. But be prepared for a prolonged consolidation or correction before a
decisive move higher.

Polygon
(MATIC) broke into the top 10 by capitalisation, taking over Solana. Over the
past 30 days, the price of MATIC has increased by 52%. Ethereum’s second-tier
scaling network came second by daily users, behind the BNB chain.

Another
recalculation showed a 4.7% increase in the mining complexity of the first
cryptocurrency. The index renewed its all-time high at 39.35T.

News Background

According to
Matrixport, US institutional investors have started actively buying bitcoin,
accounting for up to 85% of all purchases. Altcoins are still largely lagging
but could soon overtake the top two cryptocurrencies.

According to
Reuters, the US Securities and Exchange Commission (SEC) has begun inspecting
Wall Street financial advisors for cryptocurrency custody services.

One of the
largest rating agencies, Moody’s, is developing a scoring system to analyse the
risks of stablecoins. The platform will be based on assessing the quality of
collateral reports and will support up to 20 assets.

This article was written by FxPro’s Senior Market Analyst Alex
Kuptsikevich.

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