Summary
- Bitcoin (BTC) and Ethereum (ETH) find support.
- Precious metals and cryptocurrencies continue to trade in tandem.
- The Federal Reserve signals lower interest rates amid economic concerns.
Market Trends This Week
Both Bitcoin (BTC) and Ethereum (ETH) gained support at key levels this week. After pulling in for four straight weeks, buyers finally stepped into Bitcoin at a confluence of support found at the previous breakout zone from July and the intermediate-high from February. Ethereum, now well extended from the breakout in July, found support at and old high dating back to July of 2019. Though cryptocurrencies can be volatile, the pullback in recent weeks is not out of the ordinary. This year, Bitcoin was under $4,000 and is now at $11,000, while Ethereum saw prices as low as $100 and is now trading at $380.
In a meeting held Wednesday, the U.S Federal Reserve signaled that there would be little change to the current strategy. Fed chair Jerome Powell assured investors that interest rates will likely remain low until 2023. According to the Fed, economic fallout from the Coronavirus still wanes and will be the key factor for the economy moving forward.
This Week’s Topics
- Cryptocurrency platform Wirex will offer a cryptocurrency card in conjunction with Mastercard (MA)
- Kraken becomes the first cryptocurrency firm in the U.S to receive banking approval.
Next Week’s Market Forecast
Potential exists for volatility in world equity and crypto markets beyond just the Federal Reserve meeting. Some cross currents are evident in the global fight against the Coronavirus. A slew of positive developments concerning potential vaccines and treatments for the virus have emerged recently. This week, President Donald Trump announced the possibility that a vaccine could be circulated before year-end. On the other hand, pockets of Europe have seen virus numbers on the rise again. France for example reported the highest number of Coronavirus cases since the lockdown began.
In industry news, the DeFi segment continues to be a shining light. Binance’s stable coin Binance USD (BUSD) saw a record of over $100 million of inflows in the last week. The Binance news comes after several weeks of positive headlines about the DeFi segment as a whole.
Into next week, cryptocurrency investors will be looking to see if Bitcoin (BTC) and Ethereum (ETH) can hold the levels mentioned earlier in the article. So far, bulls remain in control, and the trend remains up.
