The crypto markets and Wall Street indexes are showing significant bullish momentum as we start this week. The high trade volume from the weekend has pushed the crypto market cap back above the $1 trillion mark for first time June 13th. Leading cryptocurrencies like Bitcoin and Ethereum have broken key resistance levels over the past weekend. In this article, we will see the reasons behind this relief rally and the factors that have contributed to Ethereum's remarkable surge of nearly 50% in just one week. If you enjoy daily market updates, be sure to like this article and subscribe to our channel. Let's dive into today's update.
Wall Street Opens in the Green:
The Wall Street indexes have opened in the green this morning, with the Dow Jones up 2%, the Nasdaq up 1.5%, and the S&P 500 up about 1%. This positive trend in the traditional financial markets is mirrored in the crypto markets, with the global crypto market cap currently standing at $1.02 trillion. The crypto market volume has increased by $83 billion, or 35%, in the last day, leading to an overall 6% increase.
Bitcoin's Performance:
Bitcoin, the flagship cryptocurrency, is currently trading at $22,208, up about 4.5% in the past 24 hours and 8% in the past week. On the 4-hour charts, Bitcoin is trading above all relevant exponential moving averages (EMAs), including the 20, 50, 100, and 200 EMAs. Notably, Bitcoin is now trading above its 200 EMA for the first time since April, which is an encouraging sign for the bulls. However, the relative strength index (RSI) on the 4-hour chart is nearing overbought territories, currently sitting at 67. While Bitcoin is trading above the $22,000 level, it has yet to fully sustain it as support instead of resistance. To continue trading in a higher price range, Bitcoin needs to claim $22,000 as support.
Taking a look at the weekly chart, Bitcoin's RSI is at 32, indicating that it is still oversold. There is also heavy resistance at the 200 moving average, which was previously considered as Bitcoin's bear market bottom. As shown in the chart below, Bitcoin is currently trading below the 200 moving average and has touched or approached that price level for the past three weeks.
Long-term Holders Remain Bullish:
Glassnode, a blockchain analytics firm, recently tweeted that over 80% of the total US dollar denominated wealth invested in Bitcoin has not been touched for at least three months. This indicates that the majority of Bitcoin coin supply is dormant, and long-term holders are increasingly unwilling to sell at lower prices. On-chain research from Coinbase Analytics also suggests that recent Bitcoin selling has been carried out almost exclusively by short-term investors. This is significant news, as it shows that most long-term Bitcoin holders are holding on during turbulent times, indicating a positive sentiment among this group of investors.
Crypto Fear and Greed Index Improving:
The Crypto Fear and Greed Index, which is used to gauge market sentiment, is showing signs of improvement. After reaching extreme fear levels last month with several readings in the single digits, the index has now risen to 20, indicating a significant positive gain. As we move out of extreme fear and towards regular fear, it may indicate better market conditions for crypto assets. It is worth noting that historically, when the index enters the greed zone, it often precedes market influxes.
Ethereum's Remarkable Surge:
One notable gainer in the crypto market is Ethereum, which has experienced a remarkable surge of nearly 50% in just one week. Ethereum, the second biggest cryptocurrency by market cap, is currently trading at $1,886, up about 7% in the past 24 hours and an impressive 48% in the past week. Ethereum has broken key resistance levels, including the $1,800 and $1,850 levels, and is currently trading above its 50 and 100 exponential moving averages (EMAs) on the daily chart.
There are different factors that have contributed to Ethereum's bullish momentum. First and foremost, the overall positive sentiment in the crypto markets and the traditional financial markets have provided a favorable environment for Ethereum to thrive. The recent recovery in Wall Street indexes and the increasing interest from institutional investors in cryptocurrencies have boosted confidence among crypto traders and investors, leading to increased demand for Ethereum.
In addition, the upcoming Ethereum Improvement Proposal (EIP) 1559, which is set to be implemented in July, has also fueled optimism among Ethereum holders. EIP 1559 aims to improve the efficiency and sustainability of the Ethereum network by introducing a mechanism that will burn a portion of the transaction fees, potentially reducing the supply of Ethereum and creating a deflationary effect. This has been viewed as a positive development for Ethereum and has contributed to the recent surge in its price.
Furthermore, the growing adoption of decentralized finance (DeFi) applications and non-fungible tokens (NFTs) on the Ethereum network has also been a driving force behind Ethereum's price surge. As more projects and applications are built on the Ethereum blockchain, the demand for Ether (ETH), the native cryptocurrency of the Ethereum network, has increased, driving up its price.
Conclusion:
The crypto markets and Wall Street indexes are showing significant bullish momentum, with Ethereum experiencing a remarkable surge of nearly 50% in just one week. Factors such as the overall positive sentiment in the markets, the upcoming implementation of EIP 1559, and the growing adoption of DeFi and NFTs on the Ethereum network have contributed to Ethereum's recent price surge. However, it's important to note that the cryptocurrency markets can be highly volatile, and investors should exercise caution and do their own researches before making investment decisions.
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