What to expect from the crypto market in July: top 3 forecasts
Date: 2023-07-04 Author: Karina Ziganova Categories: BLOCKCHAIN
June turned out to be extremely interesting for the crypto market: the first month of summer was marked by a significant increase in the price of a number of assets and new annual highs.
The bitcoin dominance index will begin to decline
The Bitcoin Dominance Index (BTCD) has risen significantly since hitting a low of 39% in September 2022. The growth rate accelerated in February 2022, and shortly thereafter, the indicator broke out of the 48% resistance area.
The breakout was very important as this area lasted 763 days. A breakout of a long-term resistance level often leads to significant upward movements. As expected, BTCD peaked at 52.20% in June.
Despite the apparent absence of upper horizontal resistance, there are signs indicating the possible presence of a local vertex.
First, the weekly RSI is in overbought territory and has almost reached a new all-time high. The previous time reaching this level (it is marked with a red circle on the chart) led to a sharp downward movement.
Secondly, BTCD was rejected by the 0.382 Fibonacci resistance level. The principle underlying the Fibonacci retracement levels assumes that after a significant price movement in one direction, the price retreats or partially returns to the previous price level before continuing to move.
Thus, BTCD may fall again to the 48% level, this time confirming it as support. However, in case of consolidation above 52% on the weekly timeframe, the index will head to the next important resistance at around 60.33%.
Litecoin may repeat the rally of Bitcoin Cash
In June, Bitcoin Cash (BCH) saw an impressive 170% increase. The dynamics of the price of Litecoin suggests that LTC will repeat this scenario in July.
In the period from April to June, the price of the asset completed the corrective structure A-B-C (it is marked in red on the chart). Most likely, it was the second wave in the five-wave upward movement (it is marked in black on the chart).
If the calculation is correct, Litecoin has started a third wave, as evidenced by a decisive break above the $95 resistance area. In this case, the most likely peak of the upward movement will be the $195 level, coinciding with the 0.618 Fibonacci resistance.
A close below $95 would mean that the trend remains bearish. LTC could then fall to the long-term upward support line located at $80.
Chainlink (LINK) will break the 420-day range
In the last 420 days, LINK has traded in a horizontal range between $5.75 and $9.20. Although the support and resistance areas of this range have been touched upon many times, the price of the asset has not broken out of them or declined.
In June, Chainlink closed the week below $5.75. However, the breakout (marked with a green circle on the chart) turned out to be false, as the price returned to the long-term range shortly thereafter
Such deviations are often followed by sharp upward movements. Thus, LINK could break out of the $9.20 resistance area and rise to the next resistance at $13.
If the price of Chainlink closes below $5.75, the bullish outlook will be canceled. In this case, the asset's quotes may sink to a new annual low of $4.
