Weekly Main Deterministic Factors For The Cryptocurrency Market

Weekly Main Deterministic Factors For The Cryptocurrency Market

The last week of April is planned with some surprises. Among these, the negative correction of more than 20% loss for the market; negative sentiment and low interest on the part of the big players; recovery and improvement of problems in China; price fluctuation towards the breakdown of important supports, but with a good opportunity for cheap buyback; and above all, a supposed ergonomics that would make a speedy recovery possible for the market.

Therefore, dear friend of ours, for the next few weeks it is important that you take note into the following fundamentalist factors. Do not get caught up in “cat for a hare”.

Blockchain Solutions Grow

A new report published on August 19, 2021 by the US market research firm International Data Corporation (IDC) or International Data Corporation, predicts that total spending on “blockchain solutions” globally will reach USD 6.6 billion in 2021 , and as written by criptonoticias.

This figure represents an increase of 50% compared to 2020. While the total spending on this type of deployments will reach, according to this study, USD 19 billion in 2024 at a compound annual growth rate of 48% between 2020 and 2024.

It is also estimated that 20% of the investment will come from discrete manufacturing and process manufacturing, with the fastest growing industries being professional services (56.0% compounded annually), state / local government (53, 3%) and medical care (52.7%).

Low-Rate Recovery

Less than 10 days after the accidents in China, which notably damaged several Bitcoin mining facilities, the difficulty of the network returns to normal levels and with it, the reduction of transaction fees, and as reported by criptonoticias.com.

Users can now enjoy economic commissions to make their Bitcoin transactions, when there are still approximately 6 days left for the next network difficulty adjustment, according to BTC.com.

Indeed, the hash rate has returned to optimal levels, hovering around 170 Exahashes / s, when the lowest point in recent days was 120 Eh/s, according to YCharts.

Dominance Loss

It seems a negative aspect, but it is worth remembering that until the end of this month the dominance of Bitcoin has already fallen more than 26% in relation to other assets on the market.

It is negative on one side, but it can be positive on another. For the first place we already see a higher capital allocation for other assets different from Bitcoin; and on the positive side, we can see in the coming months a momentary growth of some assets few touched, but with something in particular: we will enter a process of economic loss that will make it impossible to attract and inject new capital.

What we are experiencing is fundamentally very similar to what happened in March of last year, the date for which the pandemic expansion began that generated many losses to the global economy and an injection of fear and high fury.

However, and to date, it is good that you know that the cryptocurrency market has lost around less than 1T of dollars in its total market capitalization.

Visible Supports

Weekly, it is important to recognize the possible main supports for the asset with the highest capital. A better Elliot structure for Bitcoin is now seen within this chart time. We will also take this correction as if it were wave 4, since there was a break of the EMA9W1 at 55401.52, together with a cross of Tenkan-Sen and weekly Chande Kroll Stop, and the exact point of 53331.85.

By the time this analysis was done, the price of Bitcoin was well above 48k dollars, breaking the 0.6 of Fibo and with a diagonal trend of a possible touch of the EMA21W1 at 44045.96 in case the market continues with signs of feeling of loss and low interest in capital accumulation.

To calm the nerves of many, there is a good intercept of several exponential moving averages for the 0.7 fibo point and at exactly 36046.48. Exact and maximum point of correction, but with discrepancy to not activate extreme panic alarms. Rather, it is time to accumulate between average prices of 37k and 50k.

The fundamentals of the case and according to the Stock-to-Flow Model, we see that we are almost at the goal of reaching 100k and that this correction is normal and expected.

Now, the important thing is to wait for the crossing of the moving averages of the MACD to materialize and that at least the RSI steps very close to 30 points to be able to consider Bitcoin an oversold asset again.