Cryptocurrency Market Analysis [August 3]

Practical Cryptocurrency Investment Article August 2

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【Cryptocurrency Market Analysis】

The price movements of cryptocurrencies since last week

(one week) are summarized as follows

Summary: current price (increase/decrease from one week ago)

Bitcoin299万円 (3％)

Ethereum200000円(5%）

Binance Coin36000円(8.8％）

XRP48円（5％）

Solana5300円(6%)

Cardano65円（-%）

Polkadot1000円（10%）

Avalanche 2900円(3%)

Uniswap1060円（8%）

ICP　1000円（17％）

Bitcoin has risen slightly from last week's 2.9 million yen to the 3.0 million yen level.

※From this time, charts will be explained in dollar terms.

Bitcoin daily chart (in dollars)

On the daily chart, Bitcoin is currently forming a short-term higher low.

In the United States, rates continue to rise, and it seems that currencies are generally rising this week, perhaps already priced in.

Conversely, virtual currencies priced in dollars are falling (slightly stronger yen).

The price that Bitcoin is now constantly watching is around $20,000. The $20,000 level has held for now, and it is currently trying to reach $25,000 but could not break through.

Next, let's look at the weekly chart (in dollars).

In the weekly chart, the short-term range has not been broken, but looking at the chart shape

・From the late-2017 bubble's peak, there has been a rebound, and it has been rising on a short-term uptrend.

・Prices sit just above the 200-day moving average (orange line), and whether this moving average can be broken to the upside is a key point.

Looking at the relationship between this moving average and past prices, prices have never fallen far below this moving average.

Even if prices dip to the moving average, they have tended to bounce back there.

So with the current price, although it briefly fell below the moving average, it rebounded from the $20,000 level and is now moving back above the moving average.

This 200-day moving average has had a significant influence on Bitcoin’s price up to now, perhaps.

The United StatesFOMC rate hikes continue, and it is hard to clearly determine where the bottom is.

As for the dollar, Goldman Sachs has projected it could fall to around 125 yen within the year, but I think there is also a possibility of further yen appreciation within the year due to continued rate hikes.

Crypto Market Winter: How to Think

We received a consultation from a novice investor who bought cryptocurrency and is now in the red.

There is rarely a time when crypto keeps rising after buying.

In the current languid market, buying and taking losses is not unusual.

People not used to investing tend to worry about short-term price movements when buying financial products like cryptocurrency (I was the same in the past...).

So I think it’s important to think more about the vision for future cryptocurrency investments and the outlook for the coins you have invested in.

In the crypto market, at the end of 2017 a bubble occurred, Bitcoin rose to around 2.2 million yen, and last year in 2022 there was a surge over 7,000,000 yen.

After hitting 2.2 million yen at the end of 2017, the crypto market languished, and in my sense Bitcoin moved between50万円 and150万円.

When prices drop, the psychological sense of value also falls, and the motivation to buy decreases.

Some investors are daily watching news to see how long the winter will last.

Starting next year, will the recession cause a decline for1 year?2 years?

However, is there any advantage to the fact that the period of decline people hope for could be short?

2017 year-end bubble to present: the currencies by market cap have actually changed a lot.

Binance Coin, Solana, Polkadot, Avalanche and other platform-based cryptocurrencies have surged to the fore.

Nevertheless, Ethereum has still built an ecosystem that dominates other platform-based currencies.

Even in the current market downturn, including regulations, various projects are progressing.

Ethereum is moving from traditionalL1 (Layer 1) toL2 (Layer 2) that improves transaction fees and capacity.

In particular, the technology incorporating zero-knowledge proofsZkEVM is gaining attention and is expected to be introduced more fully around the end of 2022.

A bear market period means

・There is more time to reconsider coin selection based on ongoing daily cryptocurrency projects

・There are more opportunities to invest with funds

as advantages

People who normally work as office workers and other jobs are increasing their monthly contributions to investments, and in a long bear market there is more opportunity to accumulate at lower prices.

And at the same time, you can properly consider why you hold the coins you hold and what future value they may have.

If you can properly prepare during a crypto winter, when a bull market arrives later, you can observe the market while others rush to invest and then extract profits from the coins you bought.

When cryptocurrency rises or is covered in the news, many people who were investing in crypto may not have been following information during the bear market, right?

As a result, those who bought during the bear market stand to gain much more when the market recovers.

Observing currency projects and price trends and reflecting on why the currency you chose became as it did is also very important.

This is a rare example, but in April 2020 I invested in a platform-based currency calledSolana, which enables high-speed processing (in other words, a competitor to Ethereum).

The investment amount was small, 200,000 yen, butFTX used as a decentralized exchangeserum, which sparked my interest.

After thatSolana showed no movement for a long time, but around May 2021 the atmosphere changed,FTX intervention probably contributed, and it surged dramatically; at one pointsolana alone exceeded 9,000,000 yen in assets.

In cryptocurrency bear markets, various possibilities arise, and opportunities for the future also emerge.

In the past, people have asked me about investments that immediately fall into the red after buying and how they can do well, but by clearly considering what will happen to the assets (coins) you hold in the future, you can develop the ability to invest based on your own judgments to buy at low prices when they are good value.

For me, cryptocurrency acts as a hedge against Japanese yen, like an insurance, and over time it has grown.

Looking ahead based on the direction of the world, what should I do? I think this bear market is a period to consider such important questions.

Even if the price drops soon after buying, I don’t worry about it in particular; I’m watching how that project will develop, and the price will catch up later.