Bitcoin’s price has made significant moves in the past few days. Next, investors are waiting for the latest CPI print from the United States. Bitcoin’s dominance is also moving higher, which can be seen as poor performance in the altcoin market. Terra’s new Luna token and the old Luna Classic are both mooning. There haven’t been any significant changes in the DeFi rankings.
Bitcoin’s price is above the 50-day moving average
Bitcoin’s price is about 22,300 at the time of writing this article. It’s a significantly higher level compared to last Tuesday when Bitcoin’s price crashed below 19,000 dollars. The situation looks much better today.
The graph below shows Bitcoin’s price development in 2022 on daily candles. The blue line is the 50-day moving average and the purple trend line is the 200-day moving average.
Last Tuesday marked a new bottom for Bitcoin. The price closed the day around 18,700-18,800 dollars depending on the exchange. This is a lower closing price than we saw in mid-June. Bitcoin’s daily candle hasn’t closed this low since late 2020.
However, the market found a new trend later last week. Friday was an especially positive day in the crypto market. Bitcoin saw a rare 10.6% daily move upwards. This catapulted Bitcoin’s price above the 50-day moving average. This alone isn’t proof of a bull market, but things get serious if we witness the 50-day moving average cross the 200-day moving average in the near future.
This market move was triggered by the U.S. dollar index (DXY). It reached a new yearly high and moved to a level not seen since 2002. However, DXY crashed quickly after making a new high and this trend reversal gave equity and crypto markets a positive boost.
DXY has now fallen significantly for five consecutive days. The danger is not over, though. DXY has made similar up-and-down moves all summer. As long as the DXY is at these levels it gives downward pressure on all dollar-denominated asset classes. This includes stocks, gold, silver, Bitcoin, etc.
Swedish Youtuber CTO Larsson analyzed the DXY move in his latest video.
In the big picture, market participants are in a waiting mode. This is due to the fact that we’ll get important economic data from the U.S. soon. Later today (9/13) the new CPI print will be released. It is very important for the markets that we’d see inflation trend lower. The faster the better.
Most investors probably recall the speech the Fed chairman Jerome Powell held in Jackson Hole a fortnight ago. Powell reiterated that Fed is not going to pivot until inflation has been pushed down to around two percent. This means that Powell is going to hike rates and take liquidity off the market until he sees a significant drop in the CPI.
We’ll also hear more from the Fed next week. The U.S. central bank is going to have its first meeting since July.
Bitcoin has outperformed most altcoins
The past five days have been all about Bitcoin. The price rally that started on Friday has boosted Bitcoin’s price significantly more than altcoins. We have seen Bitcoin’s dominance take off from the 39% level. This 39%-40% area has given support for Bitcoin dominance multiple times since the year 2018.
Below you can see the top 15 ranking of cryptocurrencies. Just one coin has outperformed Bitcoin in the past week.
Solana’s native token SOL is the only cryptocurrency showing green color in the 7-day column. Even Solana has outperformed Bitcoin by a mere 3.58%. There are just three coins in the top 100 list that have outperformed Bitcoin by more than 20%.
The best performer has been Terra’s native token LUNA. It has gained more than 120% in dollar terms in just seven days. LUNA is the native token of the new Terra platform that was launched after the collapse of the old Terra system in May 2022.
The old Terra platform is still alive, though. Its native token is now called Luna Classic and uses the ticker LUNC. Even though LUNC has been one of the worst performers lately, it has gained over 270% in dollar terms in the past month.
Luna Classic has been boosted by the news that there will be a 1.2% transaction tax introduced on the network. A new staking service also launched in late August which promises almost 40% APY. It is likely that many investors are speculating that LUNA is going to make a similar move as LUNC did.
The second-best performer is Ravencoin. This project has gained popularity from Ethereum miners because of the upcoming The Merge hard fork.
Ravencoin is about have a lot more hash power securing the network. It’s already an extremely secure network with a solid structure.
Now is a good time to learn about this project and share what you’ve learned. https://t.co/GVKrhBvYmV
— Project Raven 🦅/ RVN / Ravencoin (@Ravencoin) September 5, 2022
The Merge is going to put Ethereum miners out of business. Many are now speculating that Ravencoin will be one of the coins that benefit. It is no surprise that Ravencoin’s hash rate has already made a new ATH. This development has triggered many to invest in the RVN coin even if its price has no real connection to the network’s hash rate.
The Merge is obviously the biggest even of this week, this month, and this year. The ETA is early Thursday (9/15) morning UK time. Even if The Merge is a massive update, it hasn’t had an impact on the Ethereum price. This is probably because of two major reasons.
Investors don’t usually reward coins of good news when we are in a bear market. The Merge has also been coming for years. The market has probably priced it in earlier this summer when Ethereum’s price made major gains against Bitcoin.
We’ll give a detailed report of the Merge in next week’s news overview.
No significant changes in the DeFi rankings
There has been very little drama (if any) in the DeFi sector after the early summer. The liquidity of the DeFi market has been flat for three months. TVL has been hovering between 57 and 61 billion dollars for the past three weeks. Today it stands at 59.39 billion dollars.
We published the previous market overview two weeks ago (8/30). Compared to that, there have been two changes in the top 10 protocol rankings. Uniswap & Curve and Instadapp & Compound have switched positions with small margins.
All of the top three protocols have gained between 300 and 500 million dollars of liquidity since late August.
Some investors are surprised to see that Lido hasn’t taken the number one spot because of the upcoming The Merge update. As we have written before, Lido offers liquid staking on Ethereum. Despite increasing popularity, its TVL hasn’t really changed in the past months.
Finally, let’s look at the blockchain rankings. There are no significant changes on this list either.
Ethereum holds the number one spot without any real threats. The Merge hasn’t given Ethereum a liquidity boost. This is not surprising since it is not a scaling update. There won’t be any changes to Ethereum gas fees or block times after The Merge.
The top 10 blockchain list is actually unchanged from two weeks ago.