03 May 2024

We have survived another choppy week in cryptoverse. From a high of $64,400, Bitcoin fell to $56,400 mid-week before showing signs of recovery. CZ’s prison ­sentence, underwhelming Hong Kong spot ETF debut, and macro issues are touted as reasons for this bearish sentiment. It can emotionally be a taxing ride, especially if you had locked in some positions this year.

So, in our Hot Take, we chart the technical analysis of Bitcoin and top altcoins (Ethereum, Solana, and Polygon) to identify key zones and where these assets may be headed next.

Before that, lets dive into the top-3 stories and macros of the week.

Top-3 stories of the week:

1

2

3

The newsletter is put together by Giottus Crypto Platform. You can read all the previous issues of Cryptogram here.

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WEEKLY MACROS

• Total crypto market cap - $2.23 trillion - DOWN 6.3%

• Bitcoin price - $59,587 - DOWN 7.8%

• The dollar index (DXY) - 105.24 - DOWN 0.4%

• Bitcoin Dominance - 54.17% -  DOWN 1.4%

• Crypto Fear and Greed Index - 48 - Market is Neutral

THE HOT TAKE

Technical analysis (TA) of top crypto assets

May is traditionally a volatile month for crypto and stocks. As we traverse the hot summer, we must be aware of the regions to look for support as well as the zones that need to be breached for a sustained run. Let us dive into what TA says from recent price actions.

Bitcoin

Bitcoin (BTC) has breached the lower boundary of its diminishing trend channel, witnessing an 8% decline on the weekly timeframe. Although some recovery has been observed today, the emergence of longer candles suggests a weak buying momentum. Currently trading below its 20-day Exponential Moving Average (EMA) at $63,520 and its Relative Strength Index (RSI) at 36, Bitcoin has officially entered oversold territory.

The negative trend in ETF net-flows indicates a potential extended phase of consolidation. The critical support lies at the $57,000 level, representing the 0.786 Fibonacci retracement level. If today’s non-farm payroll and employment rate reports comes in lower to prior months, it could offer some support to the broader market, potentially leading to a reversal and a notable push towards $61,000. However, failure to do so might see a test of the final support line at $54,000.

BTC Major Levels

• Support: $56,000, $57,500

• Resistance: $61,000, $64,000

Ethereum

Ethereum (ETH) is currently attempting a rebound after failing to break the $3,100 resistance earlier. Current ETH trading volumes stand at a modest $16.8 billion over the past 24 hours. This volume, coupled with significant price variability within the day's range from $2,888 to $2,977, points to active market participation but also underscores the uncertainty and high volatility in current market conditions.

As a falling wedge pattern can be observed - the asset may continue to consolidate at $3,000 levels in the short term before testing the upper boundary. With its RSI at 40 indicating oversold conditions, the Moving Average Convergence Divergence (MACD) also inclines towards selling activity. The current levels show bearish signals, potentially consolidating at current levels before retesting the pre-halving peaks. In case of stronger correction, the asset could revisit $2,850 followed by $2,700.

Major Levels

• Support: $2,850, $2,700

• Resistance: $3,150, $3,400

Against BTC, ETH continues to stay above the 0.05 level with a strong support formed at 0.049.

ETH/BTC bulls need to invalidate a bearish inverse head-and-shoulders pattern on the mentioned time frame, by moving price above the 0.054 level. The neckline of the pattern is currently located around the 0.052 level, which is also the ETH/BTC pair’s 50-period MA on the daily frame.

Solana

Solana (SOL) has managed to end its bearish trend with a 10% gain on the daily chart.

While the asset is trading below its 50-day MA ($166), it is showing early signs of a breakout from a descending parallel channel. After recording short-term gains in late April, the asset has regained momentum, post two days of positive price action. The trading volume has continued to improve over the week and has doubled to $4.34 billion from $2.33 billion last week.

Its RSI has started to climb above neutral zone reflecting resumption of buying activity. If SOL successfully breaches through the $150 barrier in the near term, it may encounter next resistance at $166, that coincides with its 50-day MA.

Major Levels

• Support: $130, $115

• Resistance: $150, $166

Against ETH, SOL is indicating a bearish trend. The pair has been oscillating between 0.041 to 0.047 this week and continues to form higher lows and lower lows on the daily chart. The Bollinger Bands are currently narrow as the price volatility shrinks near the 0.0456 mark and the price action is trending just above the indicator’s mean line.

The RSI index continues to improve towards and currently stays in neutral territory, sitting at 51. If the pair manages to successfully surpass the 0.049 mark, this could lead to further increase towards the resistance levels of 0.054.

Polygon

The MATIC/USD pair is currently attempting a rebound after failing to break the $0.73 resistance level earlier this week. After recording short-term gains last month, the asset has declined 23% since early-April. The price action has been registering short line candles in the daily chart, indicating that MATIC will continue moving sideways in medium term.

The asset is currently trading below its 50-day MA of $0.87 which acts as a key resistance level. The RSI reading is currently at 43, slightly in oversold territory. If MATIC is unable to break through the $0.78 barrier this week, the price may consolidate around $0.70 for a while.

Major Levels:

• Support: $0.68, $0.62

• Resistance: $0.78, $0.87

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If you have any questions or feedback for us, write to us at [email protected]. You can check out the previous issues here.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.BTC bottom is in? ⬆ 🚀