Weekly Analysis: $BTC, BTC Dominance and $HT

Back and forth week in the assets with the largest capitalization of the crypto market, in which we have seen how $BTC accumulated losses of more than -5% in the middle of the week, to later bounce from the support zone and approach the weekly close with a result close to 0%.

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This bounce adds strength to that support area at $18.2k, but it should also be noted that another test of this support could be dangerous as more and more orders are being executed in that area and therefore it is becoming more and more possible.

From my point of view, the weekly close of BTC can give us many clues about its evolution, since if it maintains that lower wick in the weekly candle and starts to generate short-term higher highs, it can cause the start of a new uptrend.

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In the event that these higher highs do not occur and the price returns to the support zone, the pessimistic scenario that was proposed last week becomes especially important if those lows are broken between $18.2K and $17.8K with volume.

I also wanted to review the situation of BTC dominance, which since bouncing off support has been tracing an ascending triangle creating a potential bullish pennant formation.

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Currently the dominance of BTC is at 41.7%, the high zone of the triangle, so it is possible that there is some setback, but in the event of a bullish breakout, the figure would be confirmed and a scenario could take place that would take the dominance to the 43%-44% zone. This could be accompanied by the upward movement of BTC, but that would be in a scenario in which the altcoins remain sideways.

On the other hand, I would like to highlight the result of the dominance of BTC in recent weeks in which the market has suffered widespread declines, since with this increase from 39%, it continues to indicate that $BTC continues to be used as a refuge value. in times of market uncertainty.

Regarding the rest of the crypto news, in this week without apparent relevance, tokens stand out that have managed to reverse that situation at the beginning of the week, such as $QNT with +5% or $ENS with +9%, but the asset that has had a highest decorrelation and that has achieved positive results while the market was in the red is $HT (Huobi Token), the native token of the Huobi Exchange has risen +85% after the news of the sale by the founder of Huobi, Leon Li Lin, from his stake in the company to asset management firm About Capital, which the company describes as a “sufficient” capital injection on its website.

If we focus on its technical situation, we see how this news translates into an exponential increase in its price, which has gone from trading at $4.20 last Monday to $7.70 at which it is currently trading.

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This move has generated a breakout of the downtrend line and short-term resistance at $5.85. But we see how the current price zone between $7 and $8 is a very crowded zone, which acted as macro support at the end of last year and can become a resistance zone.

If we expand the image to 1h candles we see that the movement has generated a very pronounced uptrend that is starting to leave some bearish divergence on the RSI, but no lower low has yet been generated, so the short-term uptrend continues in force.

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This uptrend has a very steep angle, so it may not last long in the market, but it can lead to another uptrend in the medium term if it starts to generate higher highs and higher lows in the coming weeks.

Focusing on the current situation, that RSI divergence indicates a lack of volume that may be the precedent of a corrective move, but it can be undone at any time if there is an entry of buying volume.

So the first scenario I propose is a correction from this resistance zone near $8, which can still make some higher highs in the short term, but if it respects the divergence, it can go for support at the broken resistance at $5.85. If on the other hand it manages to break strongly this resistance zone, it could go to test the next resistance at $9.80-$10 that we see again in the 1-day chart.

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Finally, remember that nothing discussed in our articles can be considered as investment advice. Everyone must do their own analysis and develop their own trading strategy. The Belobaba Crypto Fund team only shows our analysis and investment tools, and how they help us in our operations when making decisions.