Bitcoin is Hovering Near the $24K Level End-July as Sentiment Exits ‘Fear Zone’
The value of cryptocurrencies has dropped since it peaked at almost $3 trillion last November. As of July 26, the industry’s total market cap reverted back above $1 trillion after a deep decline. Despite the overall fall in the value of cryptocurrencies, Bitcoin, the world’s most popular digital asset, still has a network value of more than $400 billion but has dropped 55% from its year-start highs. Its volatility dropped during the last weekend of July as investors started anticipating the monthly close.
Close in July Focuses on 200-week Moving Average
According to TradingView, the BTC/USD pair maintained its resistance at around $24,000 during the week ended July 30. A flush finish also helped US equities. The S&P 500 and the Nasdaq Composite Index gained 4.2% and 4.6%, respectively.
Despite the positive sentiment surrounding the market, analysts noted that volatility could still occur within the next couple of weeks due to the lack of liquidity. For instance, Josh Geroge of CMC Markets noted that the market could still move up and down during the week ended July 31. Despite the positive performance of US equities, it was hard to get into any trades due to the current market conditions. There may be some outliers that continue to perform well.
Some noted that the current price levels are significant, as they could indicate the start of a new trend for Bitcoin. For instance, if the market closes above the 200-week moving average at around $22,800, it would be the first time Bitcoin has done so since June.
Despite the positive sentiment surrounding the market, Roman, a popular trader, noted that the current price levels are too high and suggested a return to around $23,000. The optimism continued to grow in the crypto markets on July 31. The Crypto Fear & Greed Index, which had been experiencing its longest-ever period of extreme fear, hit its highest level since April 6. At 45/100, it was officially in neutral territory.
Bullish Continuation Spotted
According to Michal Van de Poppe, the outlook for cryptocurrencies in the coming month is positive. He noted that the recent stock market performance could boost the sector.
On July 29, he noted that the summer surge in cryptocurrencies would continue in August. He also noted that Bitcoin and other digital assets could benefit from this. In the US, August was expected to be a quiet month for macro triggers. The Federal Reserve is not expected to alter its policy stance until September.
Although the risk of rising inflation remained, analysts expected that the consumer price index (CPI) would print at 8.9% in August. This week, the European Union released its highest-ever inflation estimate for the Eurozone.
Ethereum is Rallying
The recent rally in the cryptocurrency market has been led by Ethereum, which is the second-largest digital token. It is expected to gain more prominence as investors anticipate its upcoming upgrade.
The price of Ethereum has rocketed over $1,700 after briefly falling below $1,000 in June. This move is a huge boost to the crypto market, suggesting investors expect a sharp U-turn from the Fed.
Vitalik Buterin, the founder of the cryptocurrency and its spiritual leader, said that he still doesn’t believe that the project’s long-awaited merge is fully priced in. He also noted that morale would rise significantly once they completed the deal.
The price of cryptocurrencies crashed this year, wiping out over $2 trillion from the combined market cap of Bitcoin, Ethereum, Solana, and Dogecoin. It’s been a tumultuous two years for the cryptocurrency community, as various major coins hit all-time highs before crashing. According to Buterin, the technology’s high expectations have led to speculation and a rush to buy. He also added that the recent market boom has created a lot of excitement among investors, but it has also given them an impression of the potential of the cryptocurrency industry.
