Bitcoin started the week on a positive note after an unusually volatile weekend by recent standards. The BTC/USD price temporarily reached a local high of over $12,000.
The eventful weekend was preceded by a credit-rating downgrade from Fitch who placed a “negative outlook” on the United State’s triple-A rating on Friday.
Fitch added that a “resurgence of inflation” could be on the cards, which would in turn force the Fed to increase interest rates. It would be interesting to see the effects that would have on Bitcoin and its brethren.
Meanwhile, Ether (ETH), alongside a handful of other top-20 cryptos also spent much of the weekend in the green. In fact, the ETH/USD pair even breached the $400 resistance level for the first time in more than two years.
Ether’s 54% month-on-month growth in July was mostly driven by the emergence of a number of promising Ethereum-powered DeFi projects. Speaking of the unprecedented growth of DeFi, industry insiders are advising investors to exercise caution in the face of several pump-and-dump schemes.
More on these and other big stories from the day in BeInCrypto’s daily news roundup for Aug 3, 2020:
The Scam and Fall of YFI Clones
BeInCrypto recently covered the spectacular rise of the yEARN finance (YFI) token and how its rapid growth from $35 to more than $4,000 alarmed some stakeholders. Not surprisingly, a swarm of YFI clones soon emerged to mimic YFI and cash in on its success.
Andre Cronje, the founder of the original YFI token, even encouraged developers to come up with new YFI clones, a task that involves copying and tweaking the original YFI code or forking the original.
However, many of these clones now appear to be mere pump-and-dump schemes. Asuka coin, for example, looks to have swindled many investors after its creator Jongchan Jang pulled off a brazen exit scam.
Bitcoin Suffers Enormous Drop After Breaking $12,000 [Analysis]
After the $12,134 high, the price plummeted back through the most recent support line, reaching the 0.5 Fib level of the entire upward move. It is currently trading above the minor $10,850 support area.
The creation of successive support lines and the most recent break suggests that the price likely completed a five-wave formation, in which the three impulsive waves were in the upward direction.
- Bitcoin is facing long-term resistance at $11,500.
- The trend is showing considerable weakness on the daily time-frame.
- The price has likely begun an A-B-C correction.
DEX Trading Volume Tops $4 Billion in July 2020
According to data from on-chain analytics platform Dune Analytics, the total DEX volume for July almost exceeded $4.3 billion, setting a new monthly all-time high (ATH). This figure amounts to about a 200% increase from the trading activity recorded in June.
Compared to July 2019, the July DEX total constitutes a year-on-year increase of over 1,100%. As of the time of writing, the current trading volume for August is already above the $0.6 billion mark.
Ethereum Fights for a Close Above $400 Resistance
The weekly chart for Ethereum shows that while the price has likely begun an upward move, it is trading right inside a long-term resistance area between $375 and $400. The next resistance area is the 0.5 Fib level of the entire upward move around $455.
Technical indicators are bullish. Both the MACD and RSI are growing, even though the latter is inside overbought territory.
Ex-Chinese Banking Exec Says CBDCs Will Substitute Cash in Circulation
A former executive of Bank of China has urged the country’s central bank to replace cash transactions with the government-backed CBDC. The former banker said that the new digital currency can reshape monetary mechanisms, the Global Times reported.
According to him, possible options for creating the new digital currency framework could be to set up exclusive “basic accounts” on the PBoC’s digital currency platform for all social entities.
STRAT’s Failed Breakout Attempt Leads to Deviation
The daily time-frame reveals that it’s possible that Stratis (STRAT) will move upwards from this level. The price has bounced at the 4,550 support area and is in the process of reclaiming the 200-day moving average (MA).
A daily close above this MA would go a long way in supporting the bullish scenario. Furthermore, the bearish momentum on the MACD is losing steam and the RSI could soon move upwards.