Decentral Block Post

The cryptocurrency market along with the tech-heavy Nasdaq saw a bit of positive price action on July 5 amid a backdrop of rising recession concerns in the United States. 

Data from Cointelegraph Markets Pro and TradingView shows that an early morning onslaught by bears managed to drop Bitcoin (BTC) to a daily low of $19,309 before reinforcements arrived to bid the price back above support at $20,400 during the afternoon.

Here’s what several analysts are saying comes next for the top cryptocurrency and what support and resistance levels to keep an eye on moving forward.

Looking for a continuation to $23K

A bullish take on the recent Bitcoin price action was offered by independent analyst Michael van de Poppe, who posted the following chart as a follow-up to a previous Tweet that suggested Bitcoin needed to crack the resistance zone at $19,700 to continue higher:

The analyst said:

Bear markets in cryptocurrency are known to be painful, but the month of June was especially trying for the crypto faithful as a confluence of factors resulted in the price of Bitcoin (BTC) falling 37.9%, its worst monthly performance since 2011.

As a result of the continued widespread weakness, a majority of the so-called Bitcoin “tourists” have now exited the space, leaving only the most dedicated holders remaining, according to blockchain analytics firm Glassnode.

Despite Bitcoin's ongoing struggles and the fact that crypto traders are currently experiencing the worst bear market in the sector's history, several metrics suggest that the outlook isn’t as dire as some are predicting and that the hodler base of the crypto market remains strong.

Dedicated hodlers increase in number

A significant purge of active Bitcoin wallets is a common occurrence during major sell-off events as well as in early bear markets, according to Glassnode. However, the severity of the exodus has been diminishing since the bear market of 2018, indicating that “there is an increasing level of resolve amongst the average Bitcoin participant,” Glassnode said.

During the most recent reduction in the number of addresses with a non-zero balance, only 1% of the Bitcoin addresses purged their holdings entirely as compared to 2.8% between April and May 2021, and the whopping 24% that did the same between January to March of 2018.

Bitcoin (BTC) hit daily lows on the July 5 Wall Street open as the U.S. dollar saw a violent surge higher. 

USD sets yet another 20-year record

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD retreating to $19,281 on Bitstamp as the Independence Day long weekend concluded with a bump.

The pair had seen last-minute gains the day prior, these fizzling as the return of Wall Street trading was accompanied by USD strength laying waste to gains across risk assets and safe havens.

Bitcoin traded down $1,000 on the day, while spot gold shed over 2% and U.S. equities markets also fell. The S&P 500 was down 2.2% at the time of writing, while the Nasdaq Composite Index lost 1.7%.

The U.S. dollar index (DXY), on the contrary, hit 106.59, a level not seen since December 2002 and above previous breakouts from Q2 this year.

The domino effect of the 2022 bear market, which saw the downfall of numerous crypto ecosystems and tokens over several months, caught up to GARI token as it tanked over 83% in value in a matter of hours on June 4. While GARI Network brushed off the development as a “market event,” investors suspect a rug pull event. 

GARI token was launched by Salman Khan, an A-list celebrity from Bollywood, with an aim to help Indian creators monetize their content over a short video application Chingari and its nonfungible token (NFT) marketplace. Data from Cointelegraph Markets Pro and Trading View show that GARI maintained a fairly steady value, averaging out to roughly $0.6 over the past six months amid a shaky market.

GARI’s bearish movement began on June 20, however, its long-standing support gave away on June 4 when the token crashed 83.29% to its all-time lowest trading value of $0.13. Soon after, investors started comparing the situation to the Terra (LUNA) and TerraUSD (UST) collapse, with one of the members calling the actor “Salman Kwon.”

Taking control of the situation, GARI Network conducted an internal evaluation and found no evident hacks that could topple the token’s prices, stating:

“So far this looks like a market event. We assure our community that ALL tokens are safe in the respective reserves.”

The growth of Circle's native stablecoin USD Coin (USDC) in the last two months compared to its $66-billion rival giant Tether (USDT) is nothing short of spectacular.

USDT, USDC market cap ratio hits the lowest on record

Notably, USDC's market capitalization has grown by 8.27% since May, reaching its highest level of $55.9 billion on July 2. In contrast, USDT has suffered an over 19% drop in its market valuation, currently treading around $66.14 billion.

This is the closest USDC has come to challenging USDT's supremacy in the stablecoin sector based on the diminishing gap between their market caps.

In detail, the USDT to USDC market cap ratio was above "9" in August 2020. However, in July, it dropped to 1.20, the lowest on record, as shown in the chart below.

At the current rate — and with less than $10 billion now separating the two stablecoins — USDC can surpass USDT by market capitalization in a few months, if not weeks. 

The growth of Circle's native stablecoin USD Coin (USDC) in the last two months compared to its $66-billion rival giant Tether (USDT) is nothing short of spectacular.

USDT, USDC market cap ratio hits the lowest on record

Notably, USDC's market capitalization has grown by 8.27% since May, reaching its highest level of $55.9 billion on July 2. In contrast, USDT has suffered an over 19% drop in its market valuation, currently treading around $66.14 billion.

This is the closest USDC has come to challenging USDT's supremacy in the stablecoin sector based on the diminishing gap between their market caps.

In detail, the USDT to USDC market cap ratio was above "9" in August 2020. However, in July, it dropped to 1.20, the lowest on record, as shown in the chart below.

At the current rate — and with less than $10 billion now separating the two stablecoins — USDC can surpass USDT by market capitalization in a few months, if not weeks.