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- Market Update - Week 49 2024
Market Update - Week 49 2024
The premium weekly crypto market update to grow your portfolio
TL;DR
BTC is up & ETH is up
BTC under-performed ETH this week
Bitcoin dominance is down
The hot coin we look at this week is $HYPE
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BTC & ETH Market Update 📈
Crypto is up this week, with BTC being down 2.9% and ETH up 7.7%:
Bitcoin dominance has decreased over the week, starting from 54.0% to a low of 51.04% and ending at 51.5%. Investor sentiment, regulatory changes, technological advancements, and the overall growth of the cryptocurrency sector shape Bitcoin's market dominance. Its reputation as "digital gold" also enhances its position, making it a key player in the market.
It’s going to be interesting to see whether this trend will continue in the short term, as capital in crypto tends to flow initially to BTC and then further out on the risk-curve, starting with altcoins like ETH and then into mid- or low-cap coins.
Bitcoin has demonstrated remarkable resilience this week, recovering swiftly from a dramatic 15% flash crash on December 5, which saw its price dip to $90,500.
Despite a 14% drop from its previous all-time high of $104,600, Bitcoin has rebounded by 4.57%, maintaining a bullish position above key exponential moving averages (EMAs) on the 4-hour chart.
The flash crash triggered over $400 million in liquidations, marking the largest such event since 2021.
However, a significant positive outcome was the reset of Bitcoin’s open interest-weighted funding rate, which dropped from 0.09% to 0.01%.
This reset has alleviated leveraged positions in the futures market, making Bitcoin more stable and less vulnerable to further volatility. Analyst Byzantine General noted that if Bitcoin continues to rally following this reset, the market could see substantial upward momentum.
Following the price volatility, Bitcoin formed a "spinning top" candlestick pattern, signaling a period of indecisiveness. This pattern, often observed at key milestones, suggests that the recent fluctuations are likely to be short-lived.
Based on Fibonacci extensions, the immediate target for Bitcoin is $115,000, a 15% increase from the current $100,000 level. If the relative strength index (RSI) remains below overbought territory, there is potential for an aggressive breakout, pushing Bitcoin’s price to as high as $124,500.
Ethereum has also continued its upward momentum, rising 28% since November 18 and recently surpassing the $4,000 resistance level.
With a key analyst predicting a potential "impulse breakout" leading to a price target of $15,937 by May 2025, Ethereum's market outlook remains bullish.
This is supported by positive technical indicators, including a healthy Relative Strength Index (RSI) and a "golden cross" pattern, suggesting the beginning of a major rally.
Additionally, spot Ethereum ETFs are gaining institutional interest, with $1.3 billion in inflows since mid-November, and Ethereum’s DeFi metrics are strong, with total value locked (TVL) reaching a new yearly high of $77 billion.
Ethereum (ETHUSD) Analysis:
As of December 7, 2024, Ethereum has broken through the $3,930 resistance level, signaling a shift in its medium-term trend. The price has recently reached $3,999, with immediate support at $3,320 and resistance at $4,100. Despite a high RSI suggesting strong short-term momentum, low volume at price peaks could indicate a potential pullback.
Bitcoin (BTCUSD) Analysis:
As of December 7, 2024, Bitcoin (BTC) is trading at $99,663. The short-term outlook shows resistance at $100,000, with a breakout above this level potentially triggering further upward momentum. In the medium term, Bitcoin has strong support around $70,000, and its next key target could be $115,000. The long-term trend remains positive, bolstered by a strong rising trend channel and continued investor interest.
Expected Trading Ranges:
Ethereum (ETH): Support at $3,320; Resistance: $4,100
Bitcoin (BTC): Support at $92,396.86; Resistance at $115,000.
Market Outlook:
Bitcoin (BTC) has bounced back strongly after a sharp flash crash, currently trading at $99,663. The market sentiment remains bullish, with a key resistance at $100,000 and a potential target of $115,000. Support is seen around $70,000, and overall, the outlook is positive as investor interest continues to drive momentum.
Ethereum's market outlook remains bullish, with the price holding above key support at $3,320 and testing resistance at $4,100. Strong short-term momentum, supported by a positive RSI, suggests potential for further gains, though caution is warranted due to overbought conditions.
BTC/ETH ratio has seen a decrease:
The BTC to ETH conversion rate has experienced a steady decline over the past six days. Starting from 25.76 ETH per Bitcoin on December 04, the rate gradually dropped, reaching 24.97 ETH on December 07. This represents a decrease of approximately 3.1% during this period, with slight fluctuations along the way.
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Hot Coin: HYPE 🔥
In this week’s newsletter, we dive into Hyperliquid Network’s token with the ticker $HYPE.
The price action and volume have been growing consistently and don’t seem to stop any time soon:
What is the project about?
Hyperliquid is a high-performance Layer 1 blockchain optimized from the ground up. It aims to create a fully on-chain open financial system where user-built applications interface with performant native components, all while maintaining an exceptional user experience.
The Hyperliquid L1 supports an entire ecosystem of permissionless financial applications. Every order, cancel, trade, and liquidation occurs transparently on-chain with block latencies under one second. The chain currently supports up to 100,000 orders per second.
At its core, Hyperliquid uses a custom consensus algorithm, HyperBFT, heavily inspired by Hotstuff and its successors. Both the algorithm and networking stack have been optimized to support Hyperliquid’s unique requirements.
The flagship native application is the Hyperliquid DEX, a fully on-chain order book perpetuals exchange. Future developments include a native token standard, spot trading, permissionless liquidity, and more.
Why is the project exciting now?
There are four main reasons why we feature this project in this week’s newsletter:
Groundbreaking Performance and Scalability
Innovative Token Dynamics and Distribution
Strong Community and Market Momentum
Strategic Listings and Future Potential
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