This week and as usual, the Country Manager of Bitpanda Spain, Alejandro Zala, shared with Cointelegraph en Español his weekly analysis of the cryptocurrency market. On this occasion, Zala recalled that the financial world is seeing the effects of the war in Ukraine, which is at the end of its third week. “The general sentiment is quite negative and there is speculation that the war is not going to end soon,” he mentioned.
According to Zala’s analysis, Bitcoin and the market in general experienced mostly sideways movements, with prices showing volatility due to both news and changes in market sentiment that reacted in the last week with three news that, in the financial world they came to the fore. Biden’s executive order on cryptocurrency regulations, the US Federal Reserve’s announcement on raising interest rates, and the European Parliament’s Committee on Economic and Monetary Affairs voting against a possible Proof of Work cryptocurrency ban in MiCA proposal.
“This latest news comes as a relief to the cryptocurrency industry, which was keeping a close eye on the proposal,” Zala said.
On the other hand, Zala also mentioned that on Wednesday the FED announced that it would raise the interest rate by 25 basis points, according to him the first time since 2008 that the FED has raised the interest rate so much. However, for Zala, the operators welcomed the decision as somewhat bullish, since, Zala explained to us, they expected the rate hike to be much higher. “The news had a short-term positive effect on the stock market, on the price of Bitcoin and on the rest of the markets in general,” he said.
Bitcoin in an ascending trend line since January
In reference to Bitcoin, Zala highlighted that it has been in an ascending trend line since January 22. “The line has been validated numerous times, but it hasn’t been broken yet,” he said.
“Technical indicators are mixed and more or less in a neutral position, indicating that range trading is predominant. Major altcoins have been moving in a similar pattern and are likely waiting for BTC to dictate the direction of the crypto market,” Zala highlighted in analyzing him.
That said, Zala explained that for now, Bitcoin failed to break above the €38,000 level, but continues to maintain a pattern of up and down, which means that the bullish momentum is still “still in play”.
“On most time frames, technical indicators are neutral. The RSI and MACD technical indicators are close to 50 and 0 respectively, values that are considered signs of a neutral trend”, added Zala.
Cryptocurrency Fear and Greed Index Remains at “Extreme Fear”
For the past seven days, the Fear and Greed index has been showing signs of extreme fear, taking it now to the 25/100 level, still a fearful market sentiment, but slightly improved compared to Tuesday’s 21/100 according to Alejandro Zala.
“Investors don’t seem to trust the market, but selling pressure has eased, leaving room for a hold-oriented approach,” Zala said.
Zala also said that historically, buying during periods of extreme fear has generated positive returns and better profits than selling in the same market conditions. “The index is not a perfect indicator of when to buy or sell. Instead, it offers insight into when the price of Bitcoin is recognized to be low or high,” he noted.
“The war between Russia and Ukraine has undoubtedly contributed to the highly bearish sentiment of the cryptocurrency market and the announcement of the Fed raising interest rates has added to the bearish sentiment: although investors expected worse news, hence the initial bullish acceptance, the higher interest rates ended up worsening the general sentiment of the market”, added Zala. .
Altcoins after Bitcoin show signs of bottoming out
As for altcoins, Zala underlined that most are following Bitcoin’s movements and are trading in tight ranges.
“XRP has failed to break the overhead resistance level of €0.77 and is now at the main support levels of the moving averages. Choppy action will likely end with a breakout of these important levels,” he explained.
On Ethereum, Zala commented that Ether is trying to break its trend line resistance level around €2,500. “For the past few days, ETH has been trading sideways and inside a triangle pattern on the daily chart,” he mentioned.
“ETH price has found intermediate support at €2,270, while the descending trend line is forming resistance. If it wants to form an upside momentum, the price needs to break the trendline resistance,” Zala added.
For IOTA, Zala mentioned that this cryptocurrency is trading just below the downtrend line and inside a triangle pattern on the daily chart. “Price tested its support at €0.62 multiple times but was unable to convert the resistance trend line into a new support level. The RSI momentum indicator is slowly recovering but is still below 50.”
With LINK, Zala highlighted that it broke through the trend line resistance on the daily chart after a bullish action that moved the price above both the 13-day and 20-day moving averages.
As for ADA, he expressed that it is showing signs of bottoming out after several weeks of price decline. “Cardano bounced off the €0.72 support line and created large candle wicks, suggesting that buyers are very active at this level. However, the indicators are still in bearish territory”, highlighted Zala.
“ADA price has underperformed in recent weeks, but the Cardano ecosystem continues to expand. Currently, more than 517 projects are being built on top of Cardano, of which NFT charges are the largest part (34.7%),” Zala added.
Finally, Zala mentioned the total value locked on the Cardano network, which has increased, now standing at around €190 million, and the Vasil hard fork, named after Vasil Dabov, a late friend of Cardano’s founder. Charles Hoskinson. “It is scheduled for release in June and aims to bring a host of scaling improvements to DeFi, DEX, and smart contracts on the network,” he commented.
Disclaimer: This material is intended as a commentary on economic or market conditions and does not constitute financial analysis or recommendation. The analysis presented here corresponds to the Country Manager of Bitpanda in Spain and under no circumstances is an investment recommendation by Cointelegraph. Anyone, before investing, must carry out their own research and is responsible for their own decisions.
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