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Relief rally: Crypto inflows top $110B as Bitcoin recaptures $30K

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Relief rally: Crypto inflows top $110B as Bitcoin recaptures $30K

Bitcoin › Analysis

Significant inflows brought much needed relief following this week’s brutal sell-off. Nonetheless, analysts say brace for worse to come.

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2 min read

Updated: May 13, 2022 at 6:04 pm

Cover art/illustration via CryptoSlate

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The working week is set to end on a green day, with $113 billion of capital flowing back into the total crypto market cap over the last 24-hours.

Altcoins benefit from capital inflows

The market cap chart analysis shows volume picking up at around 02:00 (GMT) on May 13, peaking at 10:00. Despite volume tailing off since then, inflows have continued to climb, suggesting bear exhaustion.

Source: CoinMarketCap.com

YouTuber Lark Davies tweeted that some altcoins have posted 70% gains during this bounce to bring about some much-needed positive sentiment.

BIG bounce here! Some Alts up between 20 and 70%!!!! #crypto

— Lark Davis (@TheCryptoLark) May 13, 2022

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In the last 24 hours, the most prominent top 100 gainers were Gala at +57%, STEPN at +57%, and Kadena at 47%. Meanwhile, the market leader, Bitcoin, swung 8% to the upside recapturing $30,000. Currently, BTC is hovering tentatively close to that level at $30,600.

May 11 saw Bitcoin dominance rise dramatically from 41.6% to 45.2% (a six-month high)over the following two days. However, investors have since cycled back into altcoins leading to a drop to 44.5% at writing.

Source: BTC.D on TradingView.com

Where now for crypto?

The bounce brought much-needed relief from the brutal sell-off triggered by happenings in the Terra ecosystem. However, even considering this, the total crypto market cap is still down 20% on the week and 55% from the November 2021 high.

As events unfolded, the narrative shifted from uncertainty, of the current market cycle, to a bear market. Few analysts are calling the recent sell-off a blip in the bull phase.

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Instead, a more somber and defensive tone dominates. Will Clemente posits that more pain is ahead, giving a call of low-mid $20k for Bitcoin.

“Based on the aggregation of these metrics and price levels; bottom is most likely in low-mid $20Ks, aligning with the theory of frontrunning previous ATH.

Meanwhile, gold-bug Peter Schiff warned that Bitcoin’s move back above $30k should not be taken as a sign it has bottomed.

It’s likely this area is no longer support, but resistance. New support is much lower down.

Schiff’s tweet also drew attention to Bitcoin’s correlation to tech stocks, adding that ‘even if the Nasdaq has a bear market rally, it’s likely Bitcoin won’t participate.’

Even though Schiff has no objective evidence for that statement, he is correct in pointing out that a macro influence is in play. And with some economists predicting a sharp global economic downturn, now is not the time to extend risk.

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Altcoins

Binance Coin [BNB]: Don’t overlook these crucial indicators

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Binance Coin [BNB]: Don’t overlook these crucial indicators

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

As the dust seemingly settled in the altcoin market, Binance Coin’s (BNB) price took shape within a bearish rising wedge (yellow). The end of this tight phase could result in a sharp swing in either direction.

With the price finally breaching the basis line (green) of the Bollinger Bands (BB), the buyers affirmed the gradual increase in their influence. But, with slightly weak indications on its technicals, the buyers need to negate the selling pressure on high volumes.

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At press time, BNB was trading at $315.9, down by 2.97% in the last 24 hours. 

BNB Daily Chart

Source: TradingView, BNB/USDT

After bouncing back from the $268-support, BNB formed a rising wedge on its 4-hour chart. Now, there are two possibilities from this. Should the pattern function as a continuation of the previous downtrend, a further drawdown will be likely. A bearish outcome would expose the alt to a potential test of the Point of Control (POC, red) before any further pulldown.

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To affirm this outcome, bears would need to enforce a close below the lower trendline of the wedge. With the BB looking to curb its current volatility, the potential decline might enter a squeeze phase in the coming sessions.

On the other hand, there are chances for the buyers to step in at the $307-support. This trajectory may be possible due to the alt’s recent streak of higher troughs. An upwards breakout would position BNB toward the $357-level in the days to come. A close above $326 would boost the probability of this upswing.

Rationale

Source: TradingView, BNB/USDT

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The 4-hour RSI was denied a break above its half-line as it plunged lower towards the 44-zone. Furthermore, the -DI moved parallel with the +DI line and suggested that a bearish trend is still active.

Also, capital inflows took a hit while the CMF struggled to cross the zero-mark. However, any bounce-back from its current support range would confirm a bullish divergence.

Conclusion

Looking at its press time setup, BNB tilted slightly towards the selling market. The investors should watch out for a break outside of the current pattern to make any potential calls. Finally, keeping an eye on Bitcoin’s movement and the broader sentiment would be important to complement the aforementioned analysis.

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Altcoins

Stellar: Answer the Q whether HODLing is still the way to go

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Stellar: Answer the Q whether HODLing is still the way to go

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

At the time of writing, Stellar (XLM) was sailing below the lower boundary of its Pitchfork after the latest bearish engulfing candlestick on its daily chart. The latest selling spree has set up a bearish structure for XLM.

Any close below the current pattern could spiral into further losses by paving a pathway towards the $0.12-zone. At press time, XLM was trading at $0.1283.

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XLM Daily Chart

Source: TradingView, XLM/USD

Since XLM flipped towards the south from the $0.4-zone, the bears found renewed pressure to pull the alt and test the $0.16-mark (previous support). After a liquidation streak, the recent bearish phase saw a drawdown from this mark after an over 45% weekly decline towards its 17-month low on 12 May.

With the current structure exhibiting bearishness, the bulls need to make extraordinary efforts to halt the ongoing selling momentum. For this, they still need to propel high buying volumes. The current bearish pennant setup could play spoilsport for recent buying endeavours.

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Any close below the pattern could lead to a near-term pullback towards the $0.12-baseline. Post which, the bulls would be keen to bridge the overextended gap between the 20 EMA (red) and the 50 EMA (cyan). In this case, a close above the Pitchfork would reignite the possibilities for any recovery. 

Rationale

Source: TradingView, XLM/USD

The RSI underlined a visible selling edge while compressing in the 36-41 range. The investors/traders must watch out for a break beyond the current bounds to enter either buy/sell calls.

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Over the last four days, the bearish CMF marked lower peaks on the daily timeframe. But, any bounce-back from the -0.1-mark would confirm the existence of a bullish divergence with the price.  

Conclusion

Looking at the prevailing bearish pattern coupled with weak buying volumes, sustaining a rally for the bulls would be relatively tougher. Any break below the pennant could lead to short-term losses or an extended tight phase before the buyers show up. 

Besides, investors/traders should factor in the broader market sentiment and on-chain developments to make a profitable move.

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With a background in financial analysis and reporting, Yash is a full-time journalist at AMBCrypto. He has a keen interest in blockchain technology, with a primary focus on technical analysis of cryptocurrencies.

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Analysis

Bitcoin, Gold and Bonds could dominate 2022 – Bloomberg Intelligence

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Bitcoin, Gold and Bonds could dominate 2022 – Bloomberg Intelligence

U.K. · U.S.› Bitcoin › Analysis

As global equity markets continue their downtrend, a global commodities expert from Bloomberg believes that Bitcoin may be part of an group of assets to dominate in 2022

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2 min read

Updated: May 24, 2022 at 2:42 pm

Cover art/illustration via CryptoSlate

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Disclaimer: This article contains technical analysis, which is a methodology for forecasting the direction of prices through the study of past market data, primarily price and volume. The content presented in this article is the opinion of the author. None of the information you read on CryptoSlate should be taken as investment advice. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own diligence and consult with a financial advisor before making any investment decisions.

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Inflation is arguably out of control globally, with rates hitting as high as 9% in the U.K. while the M1 money supply grows. The stock markets have taken a massive hit, with over $7 trillion wiped off the Nasdaq in the last four months.

A senior analyst at Bloomberg Intelligence, Mike McGlone, said:

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“If stocks are going limp, Bitcoin, Gold, and Bonds could rule.”

McGlone shared the chart below to support his claim.

Source: Twitter

This spread chart shows the U.S. Treasury 10-year bond yield in orange and the price of Bitcoin against the NASDAQ 100 over the past four years. At the bottom of the Bitcoin bear market, around 2018, the chart shows a double bottom ratio of 0.5 before rising to 2.0 in early 2021.

The ability of Bitcoin to hold the 2.0 ratio since January 2021 indicates that it is performing well amid its first potential recession. The last extended global recession occurred due to the 2008 financial crisis, which was a year before the birth of Bitcoin.

Since its inception, Bitcoin has flourished in a thriving global economy. The COVID-19 hurdle of early 2020 was surpassed due to trillions of dollars flooding into circulation, much of which made its way into cryptocurrency. As the world deals with the impact of the rapid increase in money supply, Bitcoin appears to be holding firm compared to other risk-on investments.

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McGlone states that “Greater Risk in About a Year May Be #Deflation.” However, his overall sentiment continues to focus on the ability of Bitcoin and Gold to outperform the market in the near future. 

“Following an extended period of outperformance, an underperformance period may be overdue for the #stockmarket, which may shine on #gold and #Bitcoin. The BOLD1 Index (gold, bitcoin combo) has kept pace with the Nasdaq 100 Stock Index in a bull market and with lower volatility.”

The supporting chart shows the declining volatility of BOLD1 against the NASDAQ 100 index since 2019.

Source: Twitter

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