24 Christmas 2021: Happy holidays from RekTimes! It appears Santa came early this year as much of the cryptocurrency market has reversed over the past week, following Bitcoin up as it re-entered $50,000 terrority. While it is not guaranteed to hold, even sideways movement for the rest of the year would help to establish a very bullish setup leading into Q1 2022. Plus, with the market holding, what better gift is there for Christmas than the gift of crypto?
The main news stories of the week are available below:
Crypto-Economy
-
Citizens of Turkey adopting crypto amid currency crash (Yahoo)
-
Turkish President says crypto law heading to Parliament (Decrypt)
-
Terra (LUNA) surpasses Binance Smart Chain in total value locked (CoinTelegraph)
World Economy
-
Thousands of flights cancelled amid new covid outbreaks, quarantine period shortened (New York Times)
-
Russian mercenaries deploy into Eastern Ukraine (US News)
- United Nations plans $8 billion investment to restart Afghanistan economy (Wall Street Journal)
Crypto-Economy & Markets
Last week we were looking for reasons to remain optimistic. Well, over the past seven days the market delivered in a big way. Outside of Terra, which has stormed its way into the top 10 cryptocurrencies by market cap after another massive week, many coins have made modest gains over the past week. This includes Bitcoin (+6%), Ethereum (+2%), Solana (+8%), and Cardano (+13%).
Market sentiment has doubled since last week but still remains in a state of fear. The Fear & Greed index has improved from a low score of 23 last week to 41 this week. A rise in sentiment looks poised to continue as the market continues to find ground heading into the new year.
Total Market
The total cryptocurrency market has reversed for a nearly 11% gain over the past week. The Total Crypto Market Cap had rallied to as high as $2.5 trillion again before declining slightly after being rejected off the 50 day moving average.
Over the next week, we should have a better idea at where the crypto market is heading. A breakthrough of the 50 DMA would be exceedingly bullish.
Bitcoin
Over the past week, Bitcoin has rallied a solid 6% off the lows and broken out of a downward price channel that could have taken it completely out of the two year bull market uptrend.
Bitcoin is currently sitting just under $51,000 with that price area working as potential resistance again, just as it did at the end of summer 2021.
Alt Coins
The altcoin market recovery has been led by non-Ethereum alts like LUNA, SOL, XRP, ADA, DOT, AVAX, and others. The total altcoin crypto market cap has been steadily gaining momentum upward quite significantly since the summer of 2020.
This has been fueled by falling Bitcoin dominance and further adoption of interoperable chains, DeFi, and alternative payment network options.
The altcoin market cap has recently rejected off the 50 DMA level.
Total Crypto Market Analysis
The noticable rejections off the 50 DMA on many coins and total market cap calculations combined with the significant rise in market sentiment raises the probability of this being a temporary rally into another reversal / bull trap. However, we feel that probabilty is limited and shouldn't be acted upon without substantial technical evidence of such an occurrence.
More likely is either small gains or overall sideways movement for the market into Q1 2022. Barring any major setbacks in the global economy, crypto has a significant amount of reasons to continue moving up into 2022. Just be weary that the bull market can and has ended early before - so don't FOMO buy into an all time high of a popular coin only to get burned or trade emotionally.
World Economy & Markets
The main focus here this week is on Turkey's Lira currency. The currency has all but entered a complete inflationary collapse, losing more purchasing power with each passing day it seems. The problem of inflation is obviously not just limited to Turkey but includes the whole world - especially the United States as the dollar continues to inflate, though less than other existing currencies right now.
Turkey's Lira vs the US Dollar
The situation in Turkey has long prompted Turkish citizens to utilize cryptocurrencies at an exponential rate as the alternative option now exists - something the world did not have just over a decade ago.
This has also led to Turkey leader Recep Tayyip Erdoğan to announce a crytocurrency bill is already heading to Turkish Parliament. This sets a potentially world-changing precedent. Countries that experience currency problems or could simply move to adopt cryptocurrencies instead.
If this is successful, especially in multiple countries as crypto continues to be legitimized, we could see a global adoption movement as individuals, businesses, cities, and even nations move to adopt crypo and utilize the growing system.
Summary
While it appears that the cryptocurrency market is primed for a large reversal, especially into Q1 2022, know that this is no where near guaranteed. The probability is still there for a continuation of the downtrend and the liquidation of potentially billions. Many charts are showing a rejection off the 50 day moving average, demonstrating either further downside or sideways movement ahead.
As always, just be smart. Keeping holding your assets, add where you feel comfortable, and most importantly - enjoy the holidays! The final Weekly Markets release will be coming out Thursday next week.
Coming within the next week from RekTimes includes:
- Article on the crypto market in 2021: year in review (Wednesday)
- RekTimes Weekly Markets 1.20 (Thursday)
Best of luck over the next week and happy holidays!
If you enjoyed this article, check out our other content, send a tip/donation, and follow our social media through CoinTr.ee! Be sure to follow this page to be notified of our weekly postings.
