Bitcoin, Ethereum, Dogecoin Subdued Ahead Of Fresh Week: Analyst Sees No Sustained Rally Until Fed Delivers More Rate Hikes

Bitcoin dropped below the $21,000 mark on Sunday evening as the global cryptocurrency market cap declined 1% to $957.1 billion.

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Why It Matters: Cryptocurrencies fell on Sunday evening after exhibiting strength over the weekend, with Bitcoin touching a high of $21,600.64 during the period and Ethereum touching $1,377.94.

Meanwhile, stocks — risk assets, which cryptocurrencies have consistently shadowed in the recent past — were seen in the green at press time. S&P 500 and Nasdaq futures were up 0.2% and 0.3%, respectively.

“Risky assets have been beaten up enough and could be ready for a bounce here, but a sustained rally won’t be happening until the Fed has delivered a couple more massive rate hikes,” said Edward Moya, a senior market analyst with OANDA, in a note seen by Benzinga.

Going into the fresh trading week, the sentiment around cryptocurrencies remains weak. Alternative.me’s “Crypto Fear & Greed Index” flashed “Extreme Fear” at press time and was at 20. Last week, the index was at 22. A value of 100 on the index represents “Extreme Greed,” while a value of 0 shows “Extreme Fear.”

Cryptocurrency trader Michaël van de Poppe said that it remains to be seen how Bitcoin will act after the weekend as the $21,200 level has been rejected.

“Overall, strength is still there and I'm assuming further upside is happening. Crucial barrier for now; $21K.”

Remains to be seen how #Bitcoin is going to act after the weekend, as $21.2K rejected.

Overall, strength is still there and I'm assuming further upside is happening.

Crucial barrier for now; $21K. pic.twitter.com/8LBNOMl5kk

— Michaël van de Poppe (@CryptoMichNL) July 16, 2022

On-chain analysis firm Glassnode said that Bitcoin has seen two “enormous” capitulation events this year, both of which caused the largest losses in the apex coin’s transfer volume since 2011. 

One event was the collapse of Terra Classic (LUNC), which caused a total transfer volume loss of 538,000 BTC, and the other was a 480,000 BTC transfer volume loss as the market traded below the 2017 all-time high. 

2022 has seen #Bitcoin markets weather two enormous capitulation events, both with the largest $BTC transfer volume in loss since 2011.

When LUNA collapsed, the total transfer volume in loss was 538k $BTC.

This was followed by 480k $BTC as the market traded below the 2017 ATH. pic.twitter.com/oKjBm4JgjE

— glassnode (@glassnode) July 17, 2022

On the Ethereum side, there is a buzz building around a recovery in prices. Market intelligence platform Santiment said the second-largest coin by market cap saw a 29% gain in July.  

Santiment also noted an uptick in whale activity in the coin’s network in the 1,000 ETH to 100,000 ETH address tier since May. 

#Ethereum has recovered quite well in July, up +29% for the month and +14% alone in the past 24 hours. Additionally, there's an increase in the key 1k to 100k $ETH address tier since early May where 131 new whale addresses have popped up on the network. https://t.co/uGfRQ4dEls pic.twitter.com/ri8MhGIP0o

— Santiment (@santimentfeed) July 17, 2022

Chartist Ali Martinez said Ethereum appears to be “breaking out” and pinned a target of $1,670 for the coin. 

#Ethereum appears to be breaking out, targets $1,670. $ETH #ETH https://t.co/SeWDKDGDY9

— Ali Martinez (@ali_charts) July 16, 2022

Meanwhile, Ethereum Classic (ETC), considered to be a cheaper Ethereum play by some, was among the top intraday gainers on Sunday evening. The coin was up over 14% over 24 hours.

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