Weekly Crypto Technical Analysis (18th — 22nd July)

18 July 2022

Good day Crypto AQXers,

Inflation in June came in the strongest in more than 40 years. The stock market reacted more positively than expected indicating that the markets might have already priced in the high inflation numbers. The yield curve turned the most negative since 2000.

Let’s take a look at how the cryptocurrencies on our watchlist perform against the backdrop of these macroeconomic conditions.

Bitcoin (BTC)

Bitcoin (BTC) broke above the $21,500 resistance but is now facing resistance at the 50-day moving average.

Investors and traders continue to remain on the fence whenever prices of Bitcoin reach the $21,500 key price level. In fact, if we take a look at the 16th and 17th July trading sessions, the candlesticks formed two long upper wicks. This tells us that there is still supply and sellers of BTC at this price level that needs to be cleared if Bitcoin is to stage a sustained rally.

If Bitcoin breaks out above the $21,500 resistance level, we want to see strong volume accompanying the move. This would indicate that it is not just the retail investors and traders buying into the cryptocurrency but institutions also contributing to the buying demand.

Ethereum (ETH)

Ethereum (ETH) capped off a bullish week with a strong break above its resistance level.

Ethereum broke above the $1,245 resistance level and closed above the 50-day moving average to cap off a bullish week. Perhaps the only drawback was that the price action was not accompanied by strong up volume which would give the rally more legs.

Bottom fishers who managed to get in at the lows of the trading range might look to lock in some of their profits while trapped buyers who bought at the highs might want to cut their losses. This profit-taking activity might cause ETH prices to pull back in the coming week but if the big players are really accumulating Ethereum, their demand and appetite for ETH should overwhelm the supply such that any pullbacks will be shallow before prices continue to make higher highs.

Solana (SOL)

Solana (SOL) closed above the 50-day moving average with the next major resistance at the $41 price level.

Solana put in higher highs and close above its 50-day moving average last week. This is a step in the right direction for SOL as the cryptocurrency attempts to reverse its multi-month-long downtrend and go back to its highs.

The upcoming resistance that Solana is likely to encounter is at the $41 price level. Some sell-off in the crypto is to be expected at this level but a constructive price action that we ideally want to see is prices pulling back slightly and finding support at the 50-day moving average.

Cardano (ADA)

Cardano (ADA) rally is a suspect with volume lacking in its up move.

Cardano broke below the $0.45 support level on strong volume last week indicating that further bearish price action could be expected. However, ADA has managed to climb back above the $0.45 price level but is currently facing resistance at the 50-day moving average.

This rally remains a suspect as volume is lacking in this up move. We want to see volume picking up especially after last week’s strong volume on the downside to show us that institutions still do have an appetite for Cardano.

Linus

Disclaimer: Any opinion shared in this article is strictly the views and opinions of the author and should not be construed as financial advice. AQX makes no judgment on the projects or the content uploaded.

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