Bitcoin Rallies Ahead of Senate Agreement; Market Analyze

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Bitcoin and Ethereum stay well bid as U.S. senators get to an agreement on the crypto provision of the infrastructure bill. Cryptocurrencies are in rally mode as bitcoin held above $45,000 on Monday. Buyers were active ahead of a U.S. Senate compromise on tax-reporting demands for digital assets. Crypto-related stocks such as Riot Blockchain (NASDAQ: RIOT). And also Coinbase (NASDAQ: COIN) moved higher in a mixed day for the overall stock market in hopes for regulatory clarity.
Ethereum was also well bid above $3,000 at the time of this report. And is up 21% over the past week compared with an 18% rise in Bitcoin during the same time.

Bitcoin next resistance

Bitcoin pierced the 200-day moving average for the first time since April 2020. Which preceded a broad crypto rally. “With Bitcoin crossing above its 200-day, we think bitcoin will rally strongly into year-end,”. Thomas Lee, managing partner of FundStrat, wrote about it in a Monday newsletter.
Forward returns tend to be bullish for Bitcoin after a successful break of the 200-day moving average. Technical charts show the next resistance will be around $50,000 to $55,000.

Kimchi premium

The “kimchi premium,” which shows the difference between Bitcoin’s price on South Korean exchanges and the current rate on other global trading venues, is at a six-month low, based on data from CryptoQuant.

Usually a rising kimchi premium sends back trading frenzy in South Korea relative to the U.S. At the moment, a peak in the premium can precede a sell-off in Bitcoin.
This time, the “kimchi discount” might reflect a significant reduction in South Korean trading activity because of regulatory crackdowns.

At the beginning of this year, South Korea passed comprehensive cryptocurrency laws. Which it provided a structure for the legalization of crypto exchanges. In June, nevertheless, South Korea passed new legislation to enhance the supervision of cryptocurrencies. Banks have been unwilling to partner with crypto exchanges amid increasing concerns about regulatory crackdowns and the financial risk of stablecoins.

Digital asset fund

In spite of experiencing outflows for the fifth straight week. Digital asset funds saw their assets under management hit their highest level since mid-May, Lyllah Ledesma said.
The market share for Ethereum, the native cryptocurrency of the Ethereum blockchain and the second-largest overall after Bitcoin by market cap, is increasing so fast and now shows 26% of all digital investment products, compared with just 11% at the beginning of the year.
However Bitcoin has also seen positive price movements in the last few weeks. The cryptocurrency went on to bear the brunt of the outflows, totaling $33 million last week.

Ethereum implied volatility

Ethereum’s implied volatility fell sharply last week as the cryptocurrency rallied nearly 30%. The sell-off in implied volatility was especially powerful on the short end of the historical term construction over the past few days, based on the data from Skew.
Bullish sentiment is growing in the Ethereum options market as call volumes increase relative to put volumes. Option traders are pricing in a roughly 30% chance of ETH trading above $3,500 by month’s end.

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