Crypto Market Forecast: Week of April 26th 2021

Over the last week Bitcoin (BTC) was outperformed by large cap assets like Ethereum (ETH) and Binance coin (BNB), with the Bitcoin price down ~1% over the week. ETH and BNB rose by ~21% and ~9% respectively. Bitcoin’s red week was driven by a challenging weekend trading period following the announcement of a potential capital gains tax hike for wealthy Americans.

On the Ethereum network, transaction activity is surging and the block size was increased by 25% on Friday. The move came after Ethereum creator Vitalik Buterin suggested that gas limits needed to be adjusted after code updates as part of Ethereum’s recent Berlin hard fork. “Now that the chain is safer, we can increase the gas limit which makes every application cheaper,” Buterin said. According to data from CoinMetrics, Ethereum transactions hit a new all-time-high of 1.58 million on April 22nd.

The Bitcoin price plunged by ~12% on Friday and fell below the key US$50,000 price level for the first time since March. The drop coincided with news on Thursday of plans to raise long-term capital-gains taxes for the wealthiest Americans to 43.4%. The current top rate on capital gains is 23.8%. Republicans warned that stock prices and business investments could suffer from the tax regime, especially if they come paired with the corporate tax increases President Biden has proposed to pay for future infrastructure spending.

Bitcoin traders are also watching the market’s reaction to news that Tesla has cashed out some of its Bitcoin holdings. During an investor call on Tuesday the car manufacturer revealed during Q1 2021 it had generated US$272 million in Bitcoin gains and US$101 million in income from its initial US$1.5 billion BTC investment.

The company’s net cash outflow in Bitcoin was US$1.2 billion in Q1 2020. Tesla CFO Zachary Kirkhorn said the company still believes in the long term value of Bitcoin and will continue to hold a sizable long-term Bitcoin position.

Crypto news for the week ahead

28th April – IOTA Chrysalis network upgrade

On Wednesday, the IOTA (IOTA) network will complete a major upgrade. The Chrysalis upgrade will bring improvements in IOTA’s performance, stability, security and reliability. The network migration will use the new Firefly wallet that can be downloaded from the official IOTA website. The price of IOTA has risen by ~4% in the last week.

28th April – Atari Casino launches in Decentraland

Classic video game company Atari will launch a gaming casino on Wednesday within the decentralized virtual world Decentraland. The casino will host various Atari themed games playable with Decentraland’s native MANA token, the DAI US dollar stablecoin, and Atari’s native ATRI token. The Atari casino will launch in partnership with Decentral games, a community owned platform inside Decentraland for launching games. Announcement of the Atari casino in March 2021 caused the MANA price to jump sharply. MANA has risen by ~5% in the last week.

Trading set-ups for the week

Pro trader Josh Olszewicz explores trading options and signals for BTC and ETH – and lays out the trading setups he’s watching for the upcoming week. Start your week off right with Josh’s thoughts on trading strategies on a weekly basis.

Bitcoin, ALTs and Ethereum – Trading setup for the week of the 26th of April 2021

Top 10 Crypto Summary

It was a mixed week of trading for large cap assets on the Brave New Coin market cap table. Uniswap (UNI) was the best performing asset and had a strong week alongside other Ethereum based tokens like AAVE and MKR. Uniswap Version 3 is set to launch on May 5th. The update will offer better flexibility and opportunities for market makers. It will also begin the process for Uniswap to use Ethereum layer 2 solutions to enable cheaper transaction fees for platform users.

Bitcoin Price Chart

The price of Bitcoin has rebounded strongly after a difficult weekend of trading. Sentiment data, however, suggest that markets remain scarred from the price drop. The popular Crypto Fear and Greed Index suggests sentiment is currently in a ‘neutral’ state. On April 26th sentiment hit a point of ‘extreme fear’ – it’s lowest point in the last year. The markets have consistently been in a state of ‘Greed’ and ‘Extreme Greed’ during the bull run. The indicator gathers data from price volatility, volume change, social media activity, Bitcoin dominance and recent search trends.