2100NEWS WEEKLY CRYPTO REPORT Sep-29

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The index for NWST1100 has gone up by 2.28% compared to last week, while Bitcoin has shown the most favorable performance within the previous 30 days, with a 9.14% rise.

*Below, we present a standardized weekly report and next week’s outlook, prepared based on the Theory Swingtum of intelligent finance. We gauge the crypto market’s breadth and direction by showing charts 2100NEWS Digital Assets Total Index (NWST1100), which measures 1100 (by market capitalization) significant crypto assets’ performance. The information-laden chart is difficult to read initially, but the graph shows essential price information, crucial decisive price levels, momentum, trading volumes, and crypto market breadth. 

As we predicted in our previous report, the cryptocurrency market experienced a rebound after a swift test of the support level represented by the pivot point labeled “S1.” We have analyzed the NWST1100 index chart, which serves as a significant benchmark index, and discovered several important details:

  1. The NWST1100 index price significantly rebounded during the week, particularly on Thursday. This suggests that the support level held and dynamics associated with quarter-end contributed to a move over the pivot point labeled as “P.”
  2. Market Sentiment: The Percentage Price Oscillator (PPO) lines continued to rise, indicating positive momentum in the market. The PPO histogram also showed a subsequent increase, which can be interpreted as a strengthening trend. Additionally, the Relative Strength Index (RSI) has risen, suggesting that the market sentiment is becoming more bullish.
  3. Crypto Market Breadth indicators: The Crypto Market Breadth indicators at the bottom of the chart indicate an increase in market breadth. The Advance-Decline Line (ADVL) has risen, meaning that many cryptocurrencies are experiencing gains. Furthermore, the McClellan Summation Index has risen.

Considering these comprehensive observations, it is evident that the cryptocurrency market is becoming more bullish. Multiple technical indicators align with this assessment, and increasing market breadth is seen as a positive signal for the market’s overall health.

According to the chart on the right, all four A50R lines have moved out of oversold territory. This breadth indicator measures the percentage of digital assets trading above a 50-day moving average. An oversold condition indicates that many cryptocurrencies are trading below their 50-day EMA (at relatively low levels compared to their short-term moving averages). The departure from oversold territory is seen as a positive sign for market momentum. When a more significant number of cryptocurrencies start trading above their 50-day EMA, it may indicate a broader upward trend or a potential bullish sentiment in the market.

* The percentage of digital assets trading above a specific moving average is a breadth indicator that measures internal strength or weakness in the underlying index. The chart on the right side compares the percentage of DA trading above 50 days EMA for:

  1. 100 Large-caps members of NWSL100 (top box)
  2. 1100 members of NWST1100
  3. 100 Ethereum Tokens members of NWSET100
  4. 100 Coins members of NWSCo100 (bottom box)

Outlook for this week

This report analyzes the cryptocurrency market’s short-term outlook and aims to provide insights into its potential direction. Although predicting the market’s behavior is challenging, discernible patterns in market waves offer some predictability. By examining momentum indicators, we can identify several signals that shed light on the market’s possible direction in the short term.

  1. The RSI (Relative Strength Index) currently stands at 61, indicating a moderate level of buying pressure in the market. An RSI reading 61 suggests that buying forces are prevailing, and there may be room for RSI to become overbought. Overbought conditions could signal a strong bullish sentiment in the market.
  2. The Percentage Price Oscillator (PPO) histogram may continue an upturn. A rising PPO histogram can signal a strengthening momentum, suggesting an evolving trend. The PPO measures the percentage difference between two moving averages and may accelerate its ascent due to zero crossing, which means potential upward movement.
  3. Delving into the breadth indicators at the bottom of the NWST1100 chart, they may continue rising. The McClellan Summation Index is a long-term market breadth indicator based on the McClellan Oscillator. It indicates increasing breadth in the market, suggesting a broader participation of cryptocurrencies in the upward movement.

Considering the current market landscape and this analytical setup, the cryptocurrency markets are poised to rise in the upcoming week, with the target being the resistance level represented by the 143-day Exponential Moving Average (EMA).

 

 

 

 

 

 

 

Performance of different groups of Digital Assets (Coins and Tokens)

Investors and traders often use historical performance data to make informed decisions about their cryptocurrency holdings. After analyzing the data in the table, the overall index NWST1100 has increased by 2.28% over the last week, indicating a modest positive performance in the broader cryptocurrency market. The chart below highlights the performance of various cryptocurrencies, such as Bitcoin, Ether, and the 2100NEWS Indices, which represent the performance of Ethereum-based tokens (NWSET100), Large caps (NWSL100), and Coins (NWSCo100). A retrospective view over the last thirty days indicates that Bitcoin has shown the most promising performance, with a gain of 9.14%.

 

 

 

Crypto (Digital Assets) compared with global equity

These comparisons provide insights into the relative performance of digital assets and shares on capital markets over different periods.

This comparison provides insights into the performance differences between digital assets (coins, tokens) and shares on capital markets. The NWST1100 represents digital assets, while the Dow Jones Global W1Dow index represents shares on capital markets. Let’s break down the key observations and implications:

  • Historical Performance Comparison:
    • 23 Months Ago: Digital assets, represented by the NWST1100 index, were outperforming shares on capital markets, represented by the W1Dow index, with a record high quotient between the two indexes. This suggests that investing in digital assets was more profitable than shares in capital markets during that period.
    • 12 Months Ago: However, over the past 12 months, digital assets have lagged behind hares on capital markets by 7.7%. This indicates that shares on capital markets have delivered better returns than digital assets during this specific time frame.
  • Recent Shift in Performance:
    • In the current year, there has been a noticeable shift in performance, with digital assets outperforming shares on capital markets by a significant margin of 25.1%. This suggests a potential resurgence in the performance of digital assets and a change in investor sentiment toward the cryptocurrency market.
  • Mean Reversion Opportunity:
    • The chart includes a blue dashed curve representing the average quotient price (5.29) over 143 working days. This average has been lower than the long-run mean at 7.72. This observation hints at a potential buying opportunity for digital assets based on the mean reversion theory.
    • The mean reversion theory suggests that asset prices, over time, tend to revert to their historical average returns. The fact that the current average quotient price is below the long-run mean could imply that digital assets are currently undervalued compared to historical trends.
  • Returns Comparison:
    • The chart also presents the returns achieved with the stock price generated by buying one point of the respective index daily over the past twelve months.
    • The NWST1100 Crypto Index experienced a 7.29% gain compared to a year ago. Conversely, the purchased stock of the index achieved a 1.0% decrease compared to the index’s current price.
    • In contrast, the DJW Capital Index (shares on capital markets) experienced a 17.29% gain compared to a year ago. It achieved a 2.3% return on the purchased stock of the index based on daily purchases.

*The box in the middle of the chart shows the original NWST1100 price; at the bottom is W1Dow. 

 


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