crypto
BTC, ETH, BNB, XRP, ADA, SOL, DOGE, DOT, AVAX, SHIB
Bitcoin (BTC) rebounded sharply after dropping near its realized price of $24,000 on May 12, suggesting some bulls went against the herd and bought the dip. According to on-chain analytics platform CryptoQuant, the exchange balances declined by more than 24,335 Bitcoin on May 11 and 12, indicating that bulls may have started bottom fishing.
However, macro investor Raoul Pal is not confident that a bottom has been made. In an exclusive interview with Cointelegraph, Pal said that if equity markets witness a capitulation phase, crypto markets are also likely to plunge before forming a bottom. He anticipates the current bear phase to end after the United States Federal Reserve stops hiking rates.
Bear markets are known for sharp relief rallies, which are used to lighten up long positions or initiate short positions. The price eventually turns down and makes a new low. Bottoms are only confirmed in hindsight. Therefore, investors may consider accumulating in phases rather than going all-in during a bear market.
Right now, investors want to know what important overhead levels that may act as resistance. Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin bounced off $26,700 on May 12 and formed a Doji candlestick pattern. This suggests that the selling pressure could be reducing. The recovery picked up steam on May 13 and bulls pushed the price above the psychological level at $30,000.
The relief rally may face resistance near $33,000 and again at the 20-day exponential moving average (EMA) ($34,903). If the price turns down from the overhead resistance, the bears will make another attempt to sink the BTC/USDT pair below $26,700 and resume the downtrend.
If they manage to do that, the selling could accelerate and the pair may drop to $25,000 and later to $21,800.
Contrary to this assumption, if bulls arrest the next decline above $28,805, it will suggest accumulation on dips. That could enhance the prospects of a break above the 20-day EMA. If that happens, the pair may rally to the 50-day simple moving average (SMA) ($40,210).
ETH/USDT
Ether (ETH) broke below the $2,159 support on May 11 and later slipped below the psychological level at $2,000 on May 12. The bulls bought the dip to $1,800, which has started a relief rally.
The buyers will now attempt to push the price above the breakdown level at $2,159. If they succeed, the ETH/USDT pair could pick up momentum and rally to the 20-day EMA ($2,554). This is an important level to keep an eye on because a break and close above it will suggest that the decline may be over.
Contrary to this assumption, if the price turns down from the current level or the 20-day EMA, it will suggest that the sentiment remains negative and traders are selling near overhead resistance levels. The bears will then again try to sink the pair below $1,700.
BNB/USDT
BNB fell sharply on May 12 but the long tail on the day’s candlestick shows that bulls aggressively defended the critical support at $211. This started a relief rally that has reached the $350 to $320 resistance zone.
If bulls drive the price above $350, it will suggest that the decline may be over. The recovery could thereafter reach $413. Such a move could indicate that the BNB/USDT pair may remain stuck inside a large range between $211 and $692.
Contrary to this assumption, if the price turns down from the overhead resistance zone, it will suggest that bears are active at higher levels. The price could then gradually drift down to the crucial support at $211. The bears will have to sink the price below this level to start a new downtrend that may reach $175 and later $150.
XRP/USDT
Ripple (XRP) nosedived to $0.33 on May 12 when buying emerged. The bulls are attempting a recovery that is likely to face stiff resistance at the psychological level at $0.50.
If the price turns down from $0.50, the bears will again attempt to pull the XRP/USDT pair to $0.33. This is an important level for the bulls to defend because a break below it could result in a decline to $0.24.
Conversely, if buyers propel the price above $0.50, the pair could rally to the 20-day EMA ($0.56). A break and close above this level will suggest that the bulls are back in the game. The pair could then rise to the 50-day SMA ($0.70).
ADA/USDT
Cardano (ADA) plunged to $0.40 on May 12, which pulled the RSI into the deeply oversold territory. The buyers bought this dip and are attempting to start a relief rally.
The ADA/USDT pair could rise to the breakdown level at $0.74, which is an important level to keep an eye on. If the price turns down from this resistance, it will suggest that the bears have not yet given up and they are selling on rallies. The pair could then retest the strong support at $0.40.
Contrary to this assumption, if bulls propel the price above $0.74, it will indicate that the bears may be losing their grip. The pair could then rally to the psychological level at $1 where the bears are again expected to mount a strong defense.
SOL/USDT
Solana (SOL) has been in a strong downtrend for the past few days. The price dipped to $37 on May 12, which pulled the RSI deep into the oversold territory. This started a relief rally on May 13.
The bulls are likely to encounter selling in the zone between the 38.2% Fibonacci retracement level at $59 and the 50% retracement level at $66. If the price turns down from this zone, the bears will attempt to resume the downtrend by pulling the pair below $37. If they can pull it off, the SOL/USDT pair could drop to $32.
Contrary to this assumption, if the price breaks above $66, the recovery could extend to the breakdown level at $75. The bulls will have to overcome this barrier to signal that the downtrend may be coming to an end.
DOGE/USDT
Dogecoin (DOGE) plummeted to $0.06 on May 12 but a minor positive is that the bulls purchased this dip. This started a relief rally which reached near the breakdown level at $0.10.
The long wick on the May 13 candlestick indicates that the bears are defending the $10 level aggressively. If the price turns down from this resistance, the bears will attempt to resume the downtrend by pulling the DOGE/USDT pair below $0.06. If they manage to do that, the next stop could be $0.04.
Alternatively, if bulls drive the price above $0.10, the pair could rise to the 20-day EMA ($0.12). This is an important level to keep an eye on because a break and close above it could suggest the start of a stronger recovery.
Related: 3 reasons why Cardano can sink further despite ADA price bouncing 58%
DOT/USDT
Polkadot (DOT) has been in a downtrend for the past several days. The buyers stepped in to arrest the decline near the strong support at $7 on May 12 as seen from the long tail on the day’s candlestick.
The buyers will now try to sustain the price above the breakdown level at $10.37. If they succeed, the DOT/USDT pair could rise to the 20-day EMA ($13.68). This level is likely to attract strong selling by the bears. If the subsequent decline halts at $10.37, it will indicate that the downtrend may be weakening.
Conversely, if the price turns down sharply from the current level or the 20-day EMA, it will increase the possibility of a retest at $7. Below this level, the decline could extend to $5.
AVAX/USDT
Avalanche (AVAX) broke below the crucial support at $32 on May 11 and bears tried to resume the decline on May 12. However, the long tail on the day’s candlestick suggests strong buying at lower levels.
The bulls have pushed the price above the breakdown level at $32, which is the first sign of strength. If the AVAX/USDT pair sustains above $32, the bulls will attempt to push the price to the overhead resistance at $51. The bears are likely to defend this level with vigor.
Alternatively, if the price turns down from the 38.2% Fibonacci retracement level at $41.09, it will suggest that the sentiment remains negative and bears are selling on rallies. The pair could then again retest the strong support at $32 and later $23.
SHIB/USDT
Shiba Inu (SHIB) plunged below the psychological level at $0.000010 on May 12 but the long tail on the day’s candlestick suggests buying at lower levels. This resulted in a recovery on May 13.
The SHIB/USDT pair could rise to the breakdown level at $0.000017, which is likely to attract strong selling by the bears. If the price turns down from it, the bears will make another attempt to sink and sustain the pair below $0.000010.
Conversely, if bulls drive the price above $0.000017 and the 20-day EMA ($0.000018), it will suggest that markets have rejected the lower levels. The pair could then rally to the 50-day SMA ($0.000023).
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
Purpose of Ethereum 2.0
The primary goal of the Ethereum 2.0 update is to improve scalability so that the network can handle more transactions without delays or high fees.
While the full effects of the update will not be felt until it is fully rolled out, some of the possible use cases for Ethereum 2.0 include:
- Supporting the large-scale enterprise adoption of blockchain technology in private corporations and businesses;
- Creating more decentralized autonomous organizations (DAOs) and governance models based on smart contracts and trustless interactions;
- Ethereum token launches that will allow new projects to fundraise and launch their own tokens on the Ethereum network;
- The further expansion of nonfungible tokens (NFTs) and other digital assets that can be stored on the Ethereum blockchain; and
- Improved support for decentralized finance (DeFi) platforms and DApps is expected to be widely used by crypto enthusiasts and the broader public.
In addition to these benefits, it is also likely that Ethereum 2.0 will enable a variety of new use cases that are not possible on the current network, such as:
- Distributing tokens that represent ownership rights as a method of managing royalties in the music industry;
- Creating a decentralized AI (artificial intelligence) ecosystem that will allow users to train and monetize their own machine learning models;
- Facilitating safe and inexpensive cross-border payments;
- Allowing supply chain managers to track product delivery without fear of tampering;
- Providing a decentralized platform for gaming and predictive markets; and
- Increased privacy and the capacity to store large amounts of data, which can be particularly helpful for storing sensitive information such as medical records and financial data.
While there’s still time before the update is fully rolled out, the benefits it promises to bring are significant and could have a major impact on the way businesses and individuals use blockchain technology in the future.
The Ethereum platform’s popularity
The blockchain network’s popularity is expected to grow once Ethereum 2.0 is released.
Ethereum 2.0 will offer increased scalability, security and efficiency for businesses and individuals looking to take advantage of blockchain technology. Ethereum is currently one of the most well-known cryptocurrencies, alongside Bitcoin (BTC), with nearly 4 million wallets actively holding ETH as of February 2022.
The blockchain continues to be the place where most DeFi and NFT activities happen, with new DApps and projects being launched on the platform each day. According to analysts, Ethereum currently has 70% of all DeFi transactions in the cryptocurrency market, and its blockchain is used to support the majority of NFT and gaming projects.
The number of transactions on the Ethereum network
The average number of transactions on the Ethereum network is currently 1.1 to 1.5 million transactions per day.
These numbers are expected to increase exponentially after the launch of Ethereum 2.0, as it will allow significantly more transactions to be processed per day. At the moment, the network can only handle 15 transactions per second.
Ethereum 2.0 aims to increase this exponentially to about 150,000 by the time the upgrades are fully rolled out. If this becomes a reality, Ethereum will undoubtedly become one of the fastest and most scalable blockchains in existence, which should further increase its popularity.
Addressing scalability and high gas cost concerns with Ethereum 2.0
Scalability has always been one of Ethereum’s biggest challenges. This is especially true for developers seeking to build DApps and DeFi platforms on the blockchain, as transaction costs can be prohibitively high.
However, with the launch of Ethereum 2.0 (which introduces a new PoS consensus mechanism and shard chains), it will finally be possible to scale the network in a way that significantly reduces costs and facilitates faster transactions:
Tips and tricks to spend less gas fees on Ethereum
There are several ways you can reduce or even eliminate these costs when spending on gas fees on Ethereum.
- Use wallets that support batching: Batching is a feature offered by some wallets that allows you to group multiple transactions into one, thereby reducing the amount of gas you need to spend.
- Use ERC20 tokens: ERC20 tokens are digital assets that run on the Ethereum blockchain and can be used in place of ETH when paying for gas. This is because they often have much lower transaction fees than ETH, itself.
- Use a gas price calculator: Gas prices fluctuate frequently, so it’s important to use a gas price calculator to ensure you get the best possible price for your transaction.
- Use a gas tracker: A gas tracker is a tool that allows you to monitor the current gas prices on the Ethereum network in real-time. This can help ensure you’re always aware of the latest prices.
- Use a gas station: A gas station is a website that allows you to compare the gas prices of different ETH wallets to find the best one for your needs.
By following these tips, you can significantly reduce the amount of money you spend on gas when using Ethereum. This will help make it more affordable for you to use the network and participate in DeFi and other activities until such time that Ethereum 2.0 has fully launched.
The European Central Bank (ECB) is planning to launch a prototype of the digital euro in 2023. In the next five years, Europe could have its own central bank digital currency (CBDC) up and running. However, there are still many questions surrounding the prospective digital currency. In what form could it be issued? Is the ECB too late for the CBDC party, especially compared to other central banks such as that of the People’s Republic of China? To address these and other questions, Cointelegraph auf Deutsch spoke with Jonas Gross, chairman of the Digital Euro Association (DEA) and member of the expert panel of the European Blockchain Observatory and Forum.
New digital cash
Gross said that compared to digital cash issued by a commercial bank, central bank money carries fewer risks. A commercial bank can always go bankrupt, but a central bank cannot because in an emergency, it can print as much money as needed. And, in times of crisis, people may want, at least in theory, to transfer all their digital money from a private bank to the central bank, which will mean the end of the commercial banks’ business.
There are two potential mechanisms to avoid such a scenario: Either to set a cap on the amount of funds that a citizen can hold in central bank money or implement a negative interest rate applied to CBDC funds above a specified limit.
“The digital euro is mainly to become a kind of digital cash, also a new payment method and less a store of value. The central bank does not want to take away the banks’ business.”
Complete anonymity
The digital euro will not be adopted by European Union citizens if it won’t have certain features such as complete anonymity, said Gross. His team did a study that showed that it is technologically possible to make a digital euro just as anonymous as cash. It is also technically possible, Gross maintained, to allow digital euro payments to remain anonymous only up to a certain threshold, let’s say up to 10,000 euros, above which identification could be required. “This can be a great advantage for the digital euro, especially in view of the fact that cash is becoming less and less important,” Gross said.
“In an extreme case, in a few decades there could be very little use of cash, as is now the case in China or Sweden. And, if we didn’t have a digital euro that at least partially enables anonymous payments, then we would no longer have any privacy in payments. Even if it seems counterintuitive, the digital euro can promote privacy if one were to implement such a system with a focus on anonymity.”
ECB’s indecision
According to Gross, the biggest problem at the moment is that the ECB has not yet defined the aim and functions of the prospective digital euro. Last year, the ECB, in cooperation with several member states’ central banks, tested four design options for the digital currency. The first was the digital euro on the KSI blockchain, the core technology used by Estonia’s e-government.
The second option is a digital euro built on the TIPS, a European electronic payment system launched in 2018. The third possibility is a hybrid solution that sits in between the blockchain and the conventional banking system. Finally, the fourth is a bearer instrument, which is a sort of money card that can be used for payments or hardware capable of processing offline payments without access to the internet.
These are only the rough possibilities, Gross said, and the ECB has not yet settled on a single design because the range of potential applications of the digital euro is not entirely clear.
Possible geopolitical risks
Projects like the digital yuan, China’s CBDC, could weaken the position of the euro altogether, especially if foreigners are also granted access to using it. Digital currencies can make it easier and cheaper to pay in that currency, Gross explained. Amid the Russia-Ukraine war, the issue of international payments and monetary sanctions is becoming geopolitically important again.
“The Russian government says Russian gas must now be paid for in roubles,” Gross said. “The Chinese can theoretically also come up with the idea that the products we have to export, which are currently transacted in U.S. dollars or euros, must from now on be paid for in the Chinese currency, for example, in the digital yuan.”
China can strengthen its currency by digitizing it, and this could cause the euro to lose some of its influence in the future. This is why the ECB should move faster on the digital euro and decide what it wants to get out of the CBDC after all.
This is a short version of the interview with Jonas Gross. You can find the full version here (in German.)
Cardano (ADA) pared a big portion of the weekly losses incurred during this week’s crypto market rout.
ADA’s price reached an intraday high of $0.60 on May 13, a day after rebounding from its week-to-date low of $0.38 — a 58% rally.
The huge upside retracement appeared in the wake of similar price action in the crypto market with top cryptos Bitcoin (BTC) and Ether (ETH) rebounding by 23% and 25.75% since yesterday’s lows.
But the sharp ADA recovery does not promise an extended upward continuation, at least according to the three factors discussed below.
Stock market crash far from over
First, the price action in the Cardano and similar crypto-assets has been in lockstep with U.S. equities, especially tech stocks.
Notably, the correlation coefficient between ADA and the tech-heavy Nasdaq Composite was 0.93 on May 13, meaning that any major moves in stocks would likely steer Cardano in the same direction.
Moreover, the chances of Nasdaq undergoing a sharp recovery are currently slim, as analysts highlight the overstretched valuations of the Big Tech stocks and their probability of crashing further in a higher interest-rate environment.
“The [ax] is hanging, rather, over high-growth tech companies,” opines Richard Waters, the Financial Times’ West Coast editor, adding:
“This is where valuations became most stretched, and where the market is having the most trouble finding its nadir.”
Simply put, Cardano’s persistent positive correlation with Nasdaq could result in more sharp declines in the ADA market, at least for the time being.
ADA’s “fifth wave missing”
Secondly, another hint of a potential Cardano price decline comes from a technical structure highlighted by Capo of Crypto, an independent market analyst.
The pseudonymous analyst notes that ADA could fall to the $0.30–$0.35 range next, given its possibility to paint the fifth and final wave of a bearish Elliott Wave setup, as shown in the chart below.
The target range coincides with the support area from January 2021 that preceded a 850% bull run.
Descending channel breakdown
Thirdly, Cardano has been breaking below its multi-month descending channel in another sign of weakness.
ADA has been trending lower inside a range defined by two falling, parallel trendlines, underscoring traders’ current strategy of buying near the lower trendline and selling toward the upper trendline.
But on May 12, ADA/USD broke down below the lower trendline near $0.568, showing that traders ignored the buying opportunity.
Instead, buyers showed up near the $0.378-level to accumulate ADA, leading to the price rebound, as discussed above. However, the trading volume backing the recovery move was lower than during the selloffs, indicating a weakening rebound trend.
Simultaneously, the upside retracement move showed signs of further weakness after testing the descending channel’s bottom as resistance — a way of confirming the breakdown. If the bulls fail to flip the price ceiling to support, then ADA’s likelihood of continuing its prevailing downtrend will be much higher.
Related: Look out below! Ethereum derivatives data hints at further downside from ETH
Conversely, a decisive move above the channel’s lower trendline could have ADA then test its upper trendline near $1.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
-
Business2 days agoSpace industry is on its way to $1 trillion in revenue by 2040: Citi
-
Business2 days agoHow Musk’s Twitter takeover plans shook Wall Street and social media
-
Business3 days agoSpaceX paid to settle Elon Musk sexual misconduct claim, report says
-
Business2 days agoWhere the billions spent on driverless cars by US and China is heading
-
Business3 days agoCramer’s week ahead; market needs obstacles resolved before a rally
-
Business3 days agoCramer's lightning round: Signet Jewelers is a buy
-
Business2 days agoWho needs LeBron James? Luka Doncic, Ja Morant put NBA in strong media position
-
Business1 day agoFormer Miami Heat all-star Dwyane Wade shares his advice on managing money