The momentum for Ethereum has been high over the past few days. The coin recorded an ATH above $3,523.59 yesterday and gave Bitcoin bulls the needed nudge to push the coin’s price to a new horizon. Together, Bitcoin and Ethereum dominate the $2.29 trillion global crypto market cap by 61.9%. A look at their current price movers will showcase which project contributes more to this combined cap weighting.
Bitcoin’s Retarded Growth Casts Doubt on its Market Leadership
For the past decade, Bitcoin has been seen as the undisputed leader of the global crypto market, wielding a massive influence over the space. This recognition is, however, fading away as the coin has not made any move close to its ATH of $64,500 for about 3 weeks now. For several reasons ranging from the Xinjiang mining zone blackout to fears of increased capital gains tax has contributed to keeping the premier cryptocurrency well below the $60,000 psychological level.
At the time of writing, BTC is down by 0.25% to $55612.2 according to data from CEX.IO price feeds.
The BTC-USD 4H Chart above shows the market is at a point of indecision with a likely overbearing influence from the bulls. A continuous push up across the signal line can send price toward the upper region of the Bollinger Band, in a bid to retest the $60,000 price levels. Should the bulls succeed in stabilizing price above this level, Bitcoin may regain buyers’ confidence to end Q2 at a price valuation of $80,000 per coin.
Ethereum Charting a New Course for itself
Ethereum has almost completely broken off its correlation with BTC and is now charting a new path for itself. Despite its current price of $3370.33 or 1.69% dip in the past 24 hours falling below its ATH above $3500, ETH is still outpacing BTC on the weekly gain level by 24.51% to 0.46% respectively.
The latest short squeeze on derivatives exchanges forced the new ATH, fueled by the growing institutional manager’s inflow into the asset. While these may be intermittent, investors are very bullish on the future prospect of the network per the EIP 1559 and ETH 2.0 potential rollout.
Per the short term SMAs which ETH price is currently trading above, the bullish momentum is heightened, and while the coin has beaten its Q2 target of $3,000, a move toward the Q4 target above $4,900 is now being anticipated.
For both BTC and ETH, intermittent price reversals may be experienced before the targets are met.
Konstantin Anissimov, Executive Director at CEX.IO
Dogecoin lost momentum and made an attempt to settle below the support at $0.60 as traders took some profits after the recent rally.
Dogecoin quickly managed to get from $0.30 to $0.69 in less than two weeks as traders’ interest in the cryptocurrency increased and exchanges started to make it available for trading.
Cryptocurrencies remain very speculative in nature and often experience significant pullbacks so it’s not surprising to see that Dogecoin is moving lower after a strong rally.
Leading cryptocurrencies like Bitcoin and Ethereum have also lost momentum today so the downside move appears to be broad-based although XRP is moving higher.
Dogecoin faced resistance at $0.6650 and pulled back closer to the support at $0.60. RSI has pulled back a bit from recent highs, but it remains in the overbought territory.
In case Dogecoin manages to settle below the support at $0.60, it will head towards the next support level which has emerged at $0.5750. A successful test of the support at $0.5750 will open the way to the test of the support at $0.5350. If Dogecoin declines below this level, it will head towards the support at $0.45. There are no important levels between $0.45 and $0.5350 so this move may be fast.
On the upside, Dogecoin needs to settle above the resistance at $0.6650 to have a chance to develop upside momentum in the near term. The next resistance level is located near the recent highs at $0.70. If Dogecoin manages to settle above this level, it will gain additional upside momentum and head to new highs.
At this point, today’s trading action looks like a normal pullback after the major upside move. However, cryptocurrencies are very dependent on momentum so Dogecoin needs to quickly get closer to recent highs to continue its upside move. If Dogecoin fails to get more upside momentum in the next few days, the risks of a significant pullback will increase.
PayPal Holdings, Inc. (PYPL) shares rocketed over 4% higher in Wednesday’s extended-hours trading session after the company delivered a stellar quarterly earnings report.
The San Jose digital payments giant reported an adjusted first quarter (Q1) profit of $1.22 per share, blowing pasts Wall Street’s expectation of $1.01 a share. Moreover, the bottom line grew 85% from a year earlier. Revenues for the period came in at $6.03 billion, up from year-ago sales of $4.62 billion. Volume and user metrics also impressed, with the company processing $285 billion in the quarter and adding 14.5 million net new active accounts.
Looking ahead, management forecasts Q2 EPS of $1.12 on revenues of $6.25 billion. Analysts had expected earnings of $1.10 on sales of $6.16 billion. The company sees cryptocurrency continuing to drive growth in upcoming quarters. “We’ve got a tremendous amount of really great results going on tactically with our crypto efforts,” CEO Dan Schulman told investors, per CNBC. PayPal initially introduced leading cryptocurrencies to its platform last October and has progressively added more integration with digital assets over the past six months.
Through Wednesday’s close, PayPal stock has a market capitalization nearing $300 billion and trades nearly 100% higher over the last 12 months. YTD, the shares have added 5.64%, which trails the S&P 500’s gain of 11% over the same period.
Wall Street View
Late last month, Rosenblatt Securities analyst Sean Horgan raised his price target on the stock to $350 from $320 and maintained his ‘Buy’ recommendation. Horgan sees the payments giant continuing to benefit from higher levels of consumer spending, fueled by record levels of government stimulus.
Elsewhere, the stock racks up mostly favorable brokerage coverage. It receives 36 ‘Buy’ ratings, 5 ‘Overweight’ ratings, and 6 ‘Hold’ ratings. Just one analyst recommends selling the shares. Wall Street has a 12-month price median price target on the stock at $314.55. This represents 27% of upside from yesterday’s $247.40 close.
Technical Outlook and Trading Tactics
PayPal shares have recently retraced to a multi-month uptrend line extending back to the March 2020 pandemic-induced low. Although the price broke below this closely-watched indicator in Wednesday’s session, pre-market trading indicates a move back above it after the company’s solid earnings report.
Providing the stock closes above the trendline, active traders should anticipate a retest of the YTD high at $309.14. Protect capital with a stop-loss order placed under today’s low.
In my previous video, I highlighted a number of price scenarios and one of them were a higher low established off of the 52K area. We almost got that one, except that price, refuses to break 53K. For shorter time frame strategies like day trading, these sharp single candle moves offer excellent opportunities, but for swing trades, the risk is too high.
Here is what I mean: If we go long at 58K, proportional risk for a swing trade is now around 53K which means I have to risk at LEAST 5K points. In order to justify this, Bitcoin needs to push to 63K in the next leg just to reach a 1:1 reward/risk ratio. The probability of that scenario is much lower compared to if I bought around 50K, risked only 3K points, and required a retrace back to the middle of the range (55 to 58K area). The probability of a retrace back to the middle of the range is much greater than of the range low.
Since we trade rules for our swing trade strategy, we have no choice but to wait this out. Bitcoin either tests the range low again, (between 52K and 50K) and provides a setup, or we don’t assume any new risk. Waiting for the right level and setup is much more effective when it comes to returns over time compared to taking numerous low-probability trades. Many traders and investors don’t realize, over time, the losing trades cost way more than the few random wins from chasing action.
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Today’s closing price is right where the Monday’s close, and we have effectively formed a Doji on a weekly candlestick chart. We continue to see BTC as being in a consolidation stage, unsure of which direction it will take next.
But if you owned BTC futures, you made almost 5% in profits today, 7% if you owned Greyscale Ethereum Trust (+7.65%). ETHE went up more than Ethereum itself, which only gained +1.92% on the day at the time of writing.
Bitcoin’s dominance continues to dwindle, now sitting at around 45%. And while Ethereum’s share of the crypto space has been rising, it still remains under 20%. It seems that Alt. Coins have benefited the most from this recent bull run.
Bitcoin and Banks
On the fundamental front, hundreds of U.S. banks (mostly small) have signed up for a service that will allow their customers access to Bitcoin.
“What we’re doing is making it simple for everyday Americans and corporations to be able to buy bitcoin through their existing bank relationships,” Sells said. “If I’m using my mobile application to do all of my banking, now I have the ability to buy, sell and hold bitcoin.” – Yan Zhao, president of NYDIG.
While Devotion Public Data, which is a merchant to keeps money with almost 300 million financial records, will deal with the connection to moneylenders, NYDIG will deal with bitcoin care and exchange execution. Exposures will clarify that it is NYDIG, and not the banks, that handle the bitcoin, and the digital currency will not be FDIC-protected, as indicated by Zhao.
Dogecoin continued to rally and made an attempt to get to the test of the $0.70 level as traders bet that adoption of this cryptocurrency will continue to grow.
On May 3, eToro stated that it would add Dogecoin to cryptocurrencies that were traded on its exchange. EToro stated that the decision was made to due client demand.
On May 4, Bitfinex made Dogecoin pairs (DOGE/USD and DOGE/USDt) available for margin trading, which allows traders to borrow funds in order to increase their leverage and potential profits.
These moves provided significant support to Dogecoin as traders bet that increased adoption of the cryptocurrency will further boost its market cap. At this point, Dogecoin ranks fourth by market capitalization behind Bitcoin, Ethereum and Binance Coin.
Dogecoin managed to settle above previous highs at $0.60 and made an attempt to get to the test of the $0.70 level. RSI has moved into the extremely overbought territory so the risks of a pullback are increasing.
At the same time, it should be noted that RSI remains far below extreme levels that were reached back in mid-April so Dogecoin maintains solid chances to gain additional upside momentum.
The recent upside move was very fast so there are big gaps between levels. The nearest support level for Dogecoin is located at the previous highs at $0.60. In case Dogecoin settles below this level, it will move towards the next support at $0.5350. A successful test of this support level will open the way to the test of the major support level at $0.45.
On the upside, Dogecoin needs to settle above $0.70 to continue its upside move. A move above this level will likely attract more speculative traders which will be bullish for Dogecoin. I’d note that traders should keep in mind that Dogecoin is set to be very volatile in the upcoming trading sessions.
Reports reveals institutional buying on Ether had been on record high with the recent approval of CI Global Asset Management, Purpose Investments, and Evolve ETFs in Canada on offering Ethereum based exchange traded funds thereby added more credence to the altcoin.
Consequently, leading crypto experts also anticipate the flagship altcoin is not just attracting strong buying pressures because it’s [a] faster, or as an easier user experience, it’s becoming more valuable because it hosts a lot of developers on the Ethereum network coupled with high presence of users, and it keeps growing.
In addition, with the recent upgrade of Ethereum network moving to the so-called Proof of Stake, where an individual or company can validate block transactions or mine according to how many ethers, they hold will likely boast investors capability in generating more returns.
For its real case use scenario Ethereum’s continues to attract more investors as its functionality and ecosystem mature. This is because Ethereum smart contracts are better, faster at authenticating the delivery, buying or selling of digital than alternatives currently available. This further makes Ethereum powerful and will grow as applications are added.
Ether hit a record $3,523 on Tuesday on the FTX exchange with participation on the Ethereum network hitting record high.
Data retrieved from Glassnode a crypto analytic firm postulate Ethereum’s total value in the ETH 2.0 Deposit Contract just reached an all-time high of 4,193,698 ETH. The previous all-time of 4,158,946 ETH was observed on 04 May 2021.
Users continue to demand for more Ethers in purchasing as non-fungible tokens that has kept prices relatively off the roof despite significant pullbacks in some leading crypto assets including Bitcoin as Janet Yellen signals that interests might need to go up in order to avoid overheating the world’s biggest economy already addicted with stimulus support.
Already Ethereum co-founder, Buterin, who recently turned 27 some months back presently keeps about 333,520 ethers. At time of drafting this report, the altcoin was trading at $3,309, making Buterin’s stake in the second-largest crypto by market value worth about $1.1billion.