The cryptocurrency market has been trending higher this week, with most currencies and tokens gaining double digits in the last seven days. The daily movements have been minor, but constant, with today's daily candle being the only one (now) showing losses since BTC hit a low of $29,500 on July 21. The announcement that Binance, the world's largest crypto-exchange by turnover, has halted trading futures and derivative products in Germany, Italy, and the Netherlands with immediate effect has contributed to today's modest sell-off. This is the latest in a series of recent business closures by Binance, which is still being investigated by a number of regulators. As the business seeks regulatory approval and licenses around the world, Binance CEO Changpeng Zhao announced this week that if a successor CEO could be found, he would stand aside.
Bitcoin (BTC) continues to face resistance in the $40k to $42k range, despite slight pullbacks, implying that further attempts are expected in the near future. Prior barrier near $37,000 should now act as first-line support, especially given that Bitcoin has decisively broken above both the 20- and 50-day simple moving averages. Using the CCI indicator, the market is highly overbought, implying a short-term period of sub-$40k consolidation before a new attempt to surge higher.
As the ‘London' upgrade approaches, Ethereum (ETH/USD) is likely to see a spike in volatility over the next several days. The upgrade, (EIP) 1559, is set to take place next week and will raise clarity on miners' fees, reduce the amount of Ethereum tokens, and double block sizes.
Ethereum is failing to break out of its recent range, but the current price movement indicates that further attempts are imminent. ETH is back above all three simple moving averages, and while it has just tipped overbought, it has been at far higher levels in recent months. The present trading pattern is very similar to the price activity experienced in late February and early April of this year when ETH rose dramatically. The previously mentioned moving averages between $2,135 and $2,065, provide first support.
The Ethereum/Bitcoin spread is resuming its upward trajectory and approaching trendline resistance, which has weighed on the spread in recent months. Support around 550 continues to persist, implying a near-term meeting of support and resistance.
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