Crypto Weekly Outlook: November 22, 2021

The total crypto market has trended sideways since the weekend with the total crypto market cap currently sitting at $2.61T according to CoinMarketCap. Last week’s major drop is being viewed as a healthy correction by most market analysts. The unwinding of leverage and profit-taking has shifted the market sentiment from extreme greed to fear and now is sitting right in the middle of the neutral zone as determined by the Crypto Fear & Greed Index. This could possibly signal that the carnage is now mainly over, setting up a new run after the current period of consolidation finishes. That being said, all top ten cryptocurrencies experienced a weekly loss of around 10% (excluding stablecoins) and the new week has started with each one in the red aside from Solana.

Bitcoin (BTC) finished last week down 10.36% at $58,691. BTC was rejected over the weekend at the $60K level multiple times. Some analysts still believe that Bitcoin will follow historical trends and finish the month with impressive gains, but time is not on that view’s side. On a positive note, the drawdown was mainly caused by weak hands offloading newer coins, while long term holders and miners have been holding throughout the decline. Regarding the network fundamentals, the hash rate has stayed near all-time highs while the difficulty is expected to rise slightly at the next readjustment on November 27. However, on a concerning note, the National Bureau of Economic Research just put out a study concluding that the leading 10% of miners accounted for 90% of the asset generation while only a fraction was responsible for 50% with the implication being that a 51% network attack is more possible than previously believed.

Looking ahead price wise, a strong support zone is present between $50,000 and $52,500. Above that there is support at the 23.6% FIB of $53,628 and again at $54,115. Then there is a further demand wall near last week’s low around the $55,600 area. Resistance exists at the psychologically important $60K level as well as at $60,229, the 50D SMA of $60,187, $61K, and $64,806. Bitcoin is trading at $58,275 as of this writing.

Ethereum (ETH) ended last week down 7.86% at $4,262.99. It briefly fell through the psychologically important $4K level multiple times, but the bulls stepped in and the price recovered each time. In some negative press for the smart contract leader, crypto billionaire and CEO of Three Arrows, Su Zhu, recently tweeted that he has “abandoned” Ethereum despite supporting it in the past. His main reason was high network fees which have risen to unsustainable heights. However, it’s important to remember that Three Arrows Capital was one of the investors in Blizzard, a newly created fund with the purpose of developing Avalanche, one of the Ethereum killers.