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Top 3 Trending Coins: ETH Breaks Above Key $1,280 Resistance as AVAX, MATIC Continue Surge

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·5 min read
In this article:
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Key Points

  • Cryptocurrency sentiment has taken a significant turn for the better since Saturday despite thin weekend trading conditions.

  • Ethereum has surged since Saturday, breaking above key resistance at $1,280 and above its 50DMA at $1,340.

  • Avalanche is probing a key area of resistance around $22 while Polygon has continued its recent surge towards $0.80.

Market Update

Despite thin weekend trading conditions, risk appetite in cryptocurrency markets has taken a substantial turn for the better since Saturday. As of Sunday, total cryptocurrency market capitalization was around $950 billion and probing recent highs in the $965 billion area. A break above here could open the door to a swift rally to back above the $1 trillion mark, technicians think.

Total crypto market cap is currently on course to post a roughly $45 billion rise this week. Meanwhile, Bitcoin, the world’s largest cryptocurrency by market cap, was last trading in the $21,300s, up just under 4.0% in the last 24 hours according to CoinMarketCap. BTC/USD has now bounced over 12% since earlier weekly lows under $19,000.

Bitcoin is currently on course to gain about 2.5% or just over $500 this week. The rebound in sentiment since the mid-week dip reflects crypto traders taking a positive view on last week’s macro developments.

Yes, headline inflation in the US rose once again in June, as revealed by Consumer Price Index data on Wednesday. But analysts pointed to a drop in core price pressures as boosting hopes that US inflation might be close to peaking. Meanwhile, US consumer-related economic data (Retail Sales and Consumer Sentiment) was better than expected, easing recession fears.

Meanwhile, Fed policymakers reiterated that they expect a 75 bps rate hike later this month. Some had feared that in wake of the latest rise in headline inflation, they might hike rates by 100 bps. Traders will be closely scrutinizing Fed speak next week, with more policymakers scheduled to give commentary on the economy and monetary policy.

So long as they continue to signal a 75 bps rate hike is coming later this month, that may keep sentiment underpinned. Otherwise, it’s set to be a fairly quiet week in terms of US macro events. Crypto traders will thus be monitoring macro themes such as recession fears in Europe and whether Russia reopens the Nord Stream 1 Pipeline on 21 July (if it doesn’t, that signals a gas embargo has begun, which all but guarantees a European recession).

Here is a list of the top three trending coins of the day.

Ethereum (ETH)

Ethereum is one of the outperforming cryptocurrencies in the top 50 by market cap. According to CoinMarketCap, ETH is up around 13% in the last 24 hours. ETH/USD was last changing hands around $1,350, having momentarily rallied above $1,400 on Saturday. That was the cryptocurrency’s highest level on over a month. At current levels, ETH is an impressive more than 30% higher versus earlier weekly lows just above $1,000.

Ethereum is on course to have gained about 16% or nearly $200 this week, which would mark its best week since January (in terms of percentage gain). ETH/USD has benefitted in the last two days from significant technical buying upon the breakout above a key area of resistance. In late June/early July, ETH had formed a double top in the $1,280 area, but this level was broken on Saturday.

ETH/USD breaks above key area of resistance. Source: FX Empire
ETH/USD breaks above key area of resistance. Source: FX Empire

Ethereum’s latest push higher has also seen it break above its 50-Day Moving Average at $1,340. The fact that ETH/USD is on Sunday consolidating above the 50DMA will be taken as a positive signal by technicians that the near-term outlook for the pair remains positive. ETH/USD doesn’t face much by way of notable resistance until the $1,550 area (a low from late March 2021). Above that there are the mid-2021 and May 2022 lows in the $1,700 area. This is a level that many Ethereum bulls are targetting a retest of.

ETH/USD bulls eye a move back to $1,700. Source: FX Empire
ETH/USD bulls eye a move back to $1,700. Source: FX Empire

Avalanche (AVAX)

Avalanche is another outperforming cryptocurrency. According to CoinMarketCap, it was higher by around 14% in the last 24 hours. AVAX surged above its 50DMA just under $20 per token on Saturday and is now probing key resistance in the $22.0 area. This level was previously supported in May but has become resistant since June.

AVAX/USD has been forming an ascending triangle in recent weeks that implies a breakout above this level of resistance is likely in the coming sessions. A bullish break would open the door to a push higher towards the $28.0 level, which was an area of support-turned-resistance in late June.

AVAX/USD tests key resistance around $22. Source: FX Empire
AVAX/USD tests key resistance around $22. Source: FX Empire

Polygon (MATIC)

Polygon’s MATIC token is another outperformer over the past 24 hours, according to CoinMarketCap. The cryptocurrency was last up about 11% over this time period. MATIC/USD was last trading around $0.765, with the cryptocurrency having now enjoyed a near-50% rally from earlier weekly lows around $0.52.

MATIC has gained significant technical momentum since a breakout above a downtrend that had been in play since mid-May and since a surge above its 50DMA. Now that the pair has hit all of its near-term bullish targets, traders will be wondering whether it can maintain enough momentum to muster a test of the next key area of resistance just above $1.0.

MATIC/USD bullish momentum continues as traders eye $1.0. Source: FX Empire
MATIC/USD bullish momentum continues as traders eye $1.0. Source: FX Empire

This article was originally posted on FX Empire

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