Key Points

• Cryptocurrency sentiment has taken a significant turn for the better since Saturday despite thin weekend trading conditions.

• Ethereum has surged since Saturday, breaking above key resistance at $1,280 and above its 50DMA at $1,340.

• Avalanche is probing a key area of resistance around $22 while Polygon has continued its recent surge towards $0.80.

Market Update

Despite thin weekend trading conditions, risk appetite in cryptocurrency markets has taken a substantial turn for the better since Saturday. As of Sunday, total cryptocurrency market capitalization was around $950 billion and probing recent highs in the $965 billion area. A break above here could open the door to a swift rally to back above the $1 trillion mark, technicians think.

Total crypto market cap is currently on course to post a roughly $45 billion rise this week. Meanwhile, Bitcoin, the world’s largest cryptocurrency by market cap, was last trading in the $21,300s, up just under 4.0% in the last 24 hours according to CoinMarketCap. BTC/USD has now bounced over 12% since earlier weekly lows under $19,000.

Bitcoin is currently on course to gain about 2.5% or just over $500 this week. The rebound in sentiment since the mid-week dip reflects crypto traders taking a positive view on last week’s macro developments.

Yes, headline inflation in the US rose once again in June, as revealed by Consumer Price Index data on Wednesday. But analysts pointed to a drop in core price pressures as boosting hopes that US inflation might be close to peaking. Meanwhile, US consumer-related economic data (Retail Sales and Consumer Sentiment) was better than expected, easing recession fears.

Meanwhile, Fed policymakers reiterated that they expect a 75 bps rate hike later this month. Some had feared that in wake of the latest rise in headline inflation, they might hike rates by 100 bps. Traders will be closely scrutinizing Fed speak next week, with more policymakers scheduled to give commentary on the economy and monetary policy.

So long as they continue to signal a 75 bps rate hike is coming later this month, that may keep sentiment underpinned. Otherwise, it’s set to be a fairly quiet week in terms of US macro events. Crypto traders will thus be monitoring macro themes such as recession fears in Europe and whether Russia reopens the Nord Stream 1 Pipeline on 21 July (if it doesn’t, that signals a gas embargo has begun, which all but guarantees a European recession).

Here is a list of the top three trending coins of the day.

Ethereum (ETH)

Ethereum is one of the outperforming cryptocurrencies in the top 50 by market cap. According to CoinMarketCap, ETH is up around 13% in the last 24 hours. ETH/USD was last changing hands around $1,350, having momentarily rallied above $1,400 on Saturday. That was the cryptocurrency’s highest level on over a month. At current levels, ETH is an impressive more than 30% higher versus earlier weekly lows just above $1,000.