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On Monday, the broader crypto market stagnated as BTC and other major altcoins remained within tight ranges on the back of light trading volumes. It appears that traders are more inclined to wait out the events that are set to unfold later this week, including new developments with regard to the Russian-Ukraine conflict, and the U.S. Federal Reserve’s decision on rate hikes. BTC rose above the $39.5k level on the back of a mini-momentum in the early hours of Monday, but faced strong overhead resistance at the $40k psychological barrier. The largest crypto by market cap has since corrected downward, and is currently settling above the $38k mark as of the time of writing. BTC has made several choppy attempts to break above a bearish trend line that has its upper bound near the $38.7k level on its hourly chart, but upside gains remain limited due to the presence of multiple hurdles before the $40k barrier.
In a similar vein, ETH has been experiencing moderate swings within the $2,500 - $2,600 range in the past 24 hours, while most major altcoins also remain in the red due to a lack of price action in the spot market. Once again, and in what seems like the umpteenth time we are saying this — this is with the exception of LUNA. Even in this sea of red, the Layer 1 top performer is currently flirting with a triple-digit price tag after seeing its value double from $50 in less than three weeks. Talk about an exceptional performance indeed. Moving back to the broader crypto market, and whilst the spot market is awaiting clearer signals before deciding on its next direction, on-chain metrics have been consistently building up a case for an impending supply squeeze. The supply held by short-term BTC holders (STH), a group of traders who are more inclined to sell in the face of market volatility, is currently reaching an all-time low. The STH supply, which has a significant 82% of coins currently held at a loss, constitutes the most likely source of sell-side pressure in the event of a capitulation.
Within the NFT space, Yuga Labs’ recent acquisition of CryptoPunks' and Meebit's IP rights may have rekindled investors' interests in the space, and looks to be single-handedly fuelling the uptick in price actions for several NFT tokens.
In some good news, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) recently managed to pass the long-awaited Market in Crypto Assets Regulation (MiCA) legislative package via a majority vote. The legislation will provide the European Union (EU) with the necessary legal framework that will allow it to coordinate its regulatory approach to the nascent industry. One of the priorities of this legislation is to ensure that said legal framework will foster an innovation-friendly environment for new technologies to develop within, while still upholding appropriate levels of consumer protection and market integrity standards.