Macro Overview
This week saw crypto markets moving in a see-saw direction with major announcements coming from the UK Interest rate decision, US Non-farm Payroll, US Unemployment rate, US Initial Jobless claims and Eurozone Consumer Price Index (CPI).
- The Bank of England (BoE) in UK decided to hike interest rates again by 0.25% to a 15-year high of 5.25% in a bid to fight the elevated inflation to make sure that it falls all the way back to the 2% target
UK Interest Rate
- US Initial jobless claims that measures the number of individuals who filed for unemployment insurance for the first time during the past week came at 227K, in line with the estimate but more than the previous 221K. This is also seen as an encouraging sign for crypto, since the dollar is inversely correlated to crypto.
- US Non-farm payroll for July ‘23 stood at 187K below the 200K expectations. This is bullish for crypto space. It measures the change in the number of people employed during the previous month, excluding the farming industry.
- The U.S. Unemployment rate for July ‘23 came at 3.5%, below the 3.6% expectation. This is bearish for the crypto space. It measures the % of the total workforce that is unemployed and actively seeking employment during the previous month.
- The Eurozone Consumer Price Index (CPI) for July came at 5.3% in line with the forecast, but below the previous 5.5%, showing inflation is cooling down.
Next week major callouts include the US Consumer Price Index (CPI) (Jul), US Core CPI (Jul) and US Producer Price Index (PPI) (Jul)
Crypto Markets Overview
- This week, crypto markets are down by 1.9% totaling to 1.16 trillion with BTC and ETH down by 0.5% and 2.2% respectively. Bitcoin dominance stands at 50.3% with Ethereum at 19.5%.
- Litecoin successfully completed its 3rd halving, reducing the block reward by 50%: from 12.5 LTC to 6.25 LTC. The block reward is halved every 4 years. Litecoin reached its month low, down by 6% on the day it completed its third halving event.
- Bitcoin long-term holders (LTHs) are not rushing to sell their BTC holdings. Approximately 71% of the realized capitalization of Bitcoin remained unmoved for over six months contributing to the reduced selling pressure in the market.
- The race to launch ether (ETH) futures ETFs in the US has kicked off, with six firms filing applications with the SEC. Volatility Shares, Bitwise, VanEck, Roundhill, ProShares and Grayscale have all submitted applications for ETFs. The launch of ether futures ETFs would be a major milestone for the crypto industry, making it easier for institutional investors to gain exposure to ETH. However, the SEC is yet to approve any bitcoin or ether ETFs in the US
- Ethereum blockchain turned 8 years old on July 30, which started in 2015 creating its genesis block, marking the 1st block on the blockchain.
- Software firm MicroStrategy reported it bought an additional 467 bitcoin, bringing its total to 152,800, currently worth about $4.5 billion as it released its second-quarter earnings. Additionally it plans to raise up to $750M to purchase more $BTC by selling million of stock
- Celo has added Google Cloud to its list of network validators. Google Cloud’s Blockchain Node Engine will aid Celo’s migration to an Ethereum layer 2. A validator participates in verifying new transactions and helps maintain the security of a blockchain.
- USDT, Tether, bought 1,529 bitcoin (BTC) worth $45.4 million in Q2. The purchase shows that Tether is following through on a plan announced back in May to allocate 15% of quarterly profits to bitcoin. In wake of its Q2 buys, Tether now owns 54,000 BTC worth around $1.58 billion.
- Curve Finance experienced an exploit of about $47 million due to a glitch in the programming language Vyper. Curve Finance founder has offloaded 72 million Curve Dao Tokens since last week’s exploits. CEO has managed to reduce his $100 million debt, collateralized with 427 million CRV, by 21%.
Bitcoin Technical Analysis
Source: TradingView
Summary:
- Weekly Performance
– BTC experienced a neutral to bearish movement this week.
- Current Situation
– BTC is in a sideways zone of $28800-$29450.
– Expectations point to the continuation of bearishness.
– Both weekly and daily candles display neutral to bearish signals.
- Support Levels
– Immediate support at $28,800 (local demand level).
– Further support at $28,450.
- 4H Timeframe Analysis
– In the 4-hour timeframe, BTC’s price is currently below both the 50 and 200 EMA (Exponential Moving Averages).
– This indicates a bearish sentiment in the short term.
Ethereum Technical Analysis
Source:TradingView
Summary:
- ETH’s Performance Relative to BTC
– ETH has been comparatively weaker than BTC this week.
- Daily Timeframe Analysis
– ETH is currently below the 50EMA .
- Support Levels
– Immediate support at $1,794.
– Further support at $1,711.73.
- 4H Timeframe Analysis
–Last week, ETH retested the channel bottom trendline after giving a breakdown.
– This week, ETH moved downward as per the bearish expectations and it is expected to retest further support levels.
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