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Crypto Weekly Outlook: September 13, 2021

Bitcoin, as of this writing, has fallen from above $46K to under $45K. The trend does not appear positive as BTC is below key moving averages, but is still above the low from last week’s crash of $42,800. After that, the next support level is the $37K-$38K area. The price had been oscillating around the key $46K level since the crash, but if the recent drop does not reverse, this would become the new resistance. Interestingly, retail sentiment and on-chain data are giving bullish signals while technical indicators appear to skew bearish. For example, during last week’s crash, investors bought up the excess Bitcoin supply dumped by speculators - something that hasn’t always occurred in previous panics. According to Bitcoin analyst Willy Woo, all classes of Bitcoin investors either added to their holdings or weathered the market storm without selling. “Whales added recently. Minnows continue to stack. 10-1000 BTC holders mainly flat,” he wrote Sunday alongside data from on-chain analytics firm Glassnode.

Furthermore, Bitcoin analyst William Clemente commented that last week’s crash had no impact on hodler patterns. “93% of Bitcoin's supply hasn't moved in at least a month. This is an all-time high. Just another metric showing how bullish supply dynamics are,” he noted, citing Glassnode data.

Bitcoin HODL waves annotated chart. Source: William Clemente/ Twitter

In additon, CryptoQuant CEO Ki Young Ju highlighted that exchange reserves have returned to near all-time lows last seen in early May. That being said, as noted in Crowdsense's previous weekly outlook when the Bitcoin price was above $50K, "September is historically a bad month for bitcoin...the price direction certainly has not been confirmed." Since last week's outlook, Bitcoin's performance in September has drastically shifted from being up 8.84% to being down 5%.

Ethereum’s price also has not recovered from the crash. As of this writing, it has fallen below $3,300. Over the past week, ETH’s TVL has declined by 22.69%, indicating liquidity migration to rival chains. Moreover, USD Coin recently overtook Ethereum for the top spot in the cross-chain realm according to Dune Analytics. Ethereum certainly has the benefit of a disinflationary and potentially deflationary supply, but rival solutions (such as Solana) are becoming stronger. Ethereum still has support at the $3,200 area and if ETH falls through this level, very strong support is present at the $3K level. The downside risk does seem to be limited.

Cardano’s much anticipated Alonzo Hard Fork finally went into effect last night after a long four year wait. This update enables smart contract support on the proof-of-stake blockchain, a MAJOR development. However, unlike previous ADA spikes based on new milestones, ADA’s price dumped around 15% on the successful news to around $2.40 even though it had previously spiked to around $2.75 in anticipation of the event. Apparently, the market had already discounted the news by the time the update was operational. Cardano still has much to look forward to, however. The Cardano Summit 2021 will be taking place later this month and Tim Harrison, the head of marketing at IOHK, the firm behind Cardano, said that the next “few months” will be exciting to watch as more projects are launched on the mainnet. Even prominent crypto analyst Michaël van de Poppe is bullish, recently saying that ADA is capable of hitting $5.

Solana has taken a breather from its epic price discovery run, pulling back to near $160 after briefly rising above $200 last week. According to CoinMarketCap, Ripple's XRP has re-taken the #6 ranking by market capitalization from SOL, although the margin is still quite small. Notwithstanding the pullback, there has been explosive growth on this Layer 1 blockchain as it has been revealed that the current supply of stablecoin USDC on Solana is just under $2.5B, growing $1B in just a week! In addition, the total value locked (TVL) inside the Solana ecosystem has jumped by 165% in the past week, according to DeFi Llama. Solana also recently recorded its first seven-figure NFT sale, illustrating SOL's successful entry into the NFT space. SOL may be taking a breather now, but its potential seems sky high.

Avalanche (AVAX-USD) is one to certainly keep an eye on this week as it has moved up the market cap rankings to now sit in the #15 spot according to CoinMarketCap. It is currently sitting near $53, above the $50 support area, but many analysts believe it has much more room to run, some even highlighting $80 and $100 as price targets. AVAX just yesterday hit a new all-time high just under $65, but has since pulled back.

Elon Musk still has a good deal of crypto market influence as the Dogecoin spin-off FLOKI has skyrocketed 1,000% in less than four hours due to his tweet of an image of his new Shibu Inu pup named Floki. The Floki Inu cryptocurrency was created on Binance Smart Chain on June 28, the day Musk announced that his Shiba Inu dog would be named Floki. If it involves memes, the Musk factor cannot be ignored.

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