2100NEWS WEEKLY CRYPTO REPORT Nov-3

The NWST1100 index has risen by 4.22% from the previous week. JUST (JST),  a Large-cap Non-Ethereum-based Token, is biweekly making the most significant leap in rank within the NWSL100 crypto index.

*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 complex to read initially, but the chart shows essential price information, crucial decisive price levels, momentum, trading volumes, and crypto market breadth. 

Based on our previous analysis, where we predicted that the market would consolidate, we have conducted a detailed examination of the NWST1100 chart, a vital metric for the cryptocurrency market. Our thorough review of various indicators has yielded a plethora of salient observations:

1. The NWST1100 index’s trajectory showing a slowdown in growth pace indicates that the strong upward movement observed earlier may be losing momentum. This could imply that the market is entering a consolidation phase after a period of significant gains.
2. Market sentiment: The PPO lines appear to be flattening, which often occurs when there is a pause in the market after a significant price movement. The PPO histogram has a downward slope, which can be a precursor to a slowdown in the growth rate or even a potential trend reversal. The trajectory of the Relative Strength Index (RSI) has changed direction. However, it has been overbought, indicating that the market could be due for a correction.
3. We are shifting our focus to the Crypto Market Breadth indicators at the bottom of the NWST1100 chart. The Advance-Decline Line (ADVL) showcases an ascent. This indicator hints at a positive market breadth, capturing the disparity between advancing and declining cryptocurrencies. The dominance of advancing cryptocurrencies could bolster the overall market sentiment. Adding to the optimism, the McClellan Summation Index’s climb indicates potential latent positive movements in the market.

Considering these insights, with over 70 percent of cryptocurrencies trading above their 50-day EMA, so residing in the “red overbought territory,” while this indicates that a significant part of the market is experiencing bullish sentiment, it also raises the caution of potential overbought conditions that could lead to a retraction as the market seeks to balance out.

The chart on the right shows that all four A50R lines have been overbought. This breadth indicator measures the percentage of digital assets trading above a 50-day moving average. Yet, being in this zone doesn’t necessarily mean the market will drop. It could show strong momentum pushing the market, much like what was observed at the start of the year. However, it’s also a heads-up that the market might be getting too hot.

*This breadth indicator is essential in measuring the internal strength or weakness of the underlying index. Looking at the chart on the right side, we can see the A50R lines for four different categories of digital assets:

1. The top box shows the A50R lines for 100 Large-cap members of NWSL100.
2. The middle box displays the A50R lines for 1100 members of NWST1100, which is the Total Index measuring the performance of significant crypto assets based on market capitalization.
3. The third box shows the A50R lines for 100 Ethereum Tokens members of NWSET100.
4. The bottom box represents the A50R lines for 100 Coins members of NWSCo100.

Outlook for this week

This report aims to provide insights into the cryptocurrency market’s near-term outlook. While complete predictability remains challenging, the market waves show some degree of predictability with discernible patterns in market behavior. By examining momentum indicators, several signals emerge that offer insights into the potential direction of the market in the short term.

1. The crypto market may follow a similar pattern to those observed in February and March, as marked by ellipses on the provided chart.
2. The RSI (Relative Strength Index) currently stands in overbought territory, with a reading of 80.
3. The PPO lines may soon shift from a flat to a descending trajectory. The falling histogram of the Percentage Price Oscillator may change direction to upward. However, an upward change in the histogram could mean a reversal or slowing down of the downward momentum.
4. The Breadth indicators at the bottom of the first chart (NWST1100) point towards market growth. A rising McClellan Summation Index, derived from the McClellan Oscillator, underlines the possibility of widespread market participation in the bullish sentiment.
5. The seasonal pattern associated with the approach of Thanksgiving, historically correlated with market growth, may provide an upward push, potentially offsetting the consolidation suggested by other indicators.

Considering the consolidation signals from the technical indicators and the bullish seasonal trend, a cautiously optimistic view suggests that while the market shows overbought conditions that could lead to consolidation, seasonal trends could propel the market toward higher resistance levels in the near term. The NWST1100 may move towards the resistance area R1, implying an expectation of continued market growth or at least a test of higher price levels before any potential consolidation.

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

Investors and traders often rely on historical performance data to make informed decisions about their cryptocurrency holdings. After analyzing the data in the table, the overall index NWST1100 has risen by 4.22% 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 and Coins (NWSCo100) have shown the most promising performance, with a gain of over 27%. The relative Rotation Graph shows that NWSC100 is improving momentum. Conversely, Bitcoin’s momentum is fading, and it is currently in the yellow Weakening quadrant. Investors might interpret the strong performance of Coins (NWSCo100) as a signal to diversify their portfolios with other cryptocurrencies, not just Bitcoin, to capitalize on potential gains in a broader range of assets.

*RRG® charts show you the relative strength and momentum of groups of digital assets. That with strong relative strength and momentum appears in the green Leading quadrant. As relative momentum fades, they typically move into the yellow Weakening quadrant. If relative strength then fades, they move into the red Lagging quadrant. Finally, when momentum picks up again, they shift into the blue Improving quadrant.

Crypto (Digital Assets) compared with global equity

This report offers a comprehensive analysis comparing the performance of digital assets, as signified by the NWST1100 index, to shares on global capital markets, as represented by the Dow Jones Global W1Dow index. The comparison spans various timeframes, offering insights into historical and recent performances and potential future trends.

Let’s break down the key observations and implications:

• Historical Performance Comparison:
  • 24 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. At this juncture, digital assets displayed a notably superior performance trajectory compared to shares on global capital markets.
  • 12 Months Ago: Fast-forwarding to a year back, digital assets had a clear edge, outperforming shares by 3.1%. This performance data accentuates the heightened returns digital assets offered over shares in the specified duration.
• Recent Shift in Performance:
  • An analysis of the present year reveals a stark enhancement in the performance of digital assets. They have surpassed shares on global capital markets by a significant 51.2% margin, indicating a change in tide and possibly hinting at growing confidence among investors in the digital asset sector.
• Mean Reversion Opportunity:
  • The average quotient price over the past 143 working days is plotted as a blue dashed curve (5.38). Currently, this average sits below its long-run mean, hovering around 7.51. Such a deviation underscores a potential opportunity to invest in digital assets, leveraging 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 generated by buying one point of the respective index daily over the past twelve months.
  • The NWST1100 Crypto Index enjoyed a 22.31% appreciation relative to the same period last year. With daily index investments, an investor’s stock would have seen a 19.3% uplift compared to the index’s current price.
  • Contrasting with the crypto index, the DJW, representing global capital market shares, grew by 15.49% over the past year. However, a strategy involving daily purchases would have resulted in a gain of 1.7%.
  • To conclude, expectations are rife as we stand at the confirmed bullish trend between digital assets and global capital market shares. Digital assets purchased over the preceding year at an average price of 2591 points seem poised to offer magnified returns compared to shares as we traverse this bullish phase.

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

Indices Revision 11-03-2023

Based on the latest Bi-weekly revision, JUST and IOTA have improved their ranking and were added to the NWSL100 index. On the other hand, Cheelee and DyDx were removed from the NWSL100 index. Several new mid-cap assets have been added to the NWSM200 index, including Celestia, Beldex, Telcoin, etc. More information about the additions and deletions for other indices in the family is available in each index’s presentation.

Winning member

Congratulations to JUST (JST) for achieving a significant milestone by being recognized as the winning member of the NWSL100 crypto index with the most significant leap in rank within the NWSL100 crypto index. Let’s delve into the details of its performance:

1. Performance in the Last Ten Weeks: JUST (JST) has displayed a growth trajectory that resonated with the 2100NEWS Digital Assets 100 Large Cap Index (NWSL100) performance. However, a significant bullish surge in early November set JST apart, reinforcing its independent market dynamics. The violet area chart highlights JST’s remarkable achievement, outpacing the NWSL100 index by a whopping 40%. This difference in performance underscores JST’s resilience and potential in the market.
2. JST vs. NWSL100: A comparison of JST’s performance with the NWSL100 index reveals interesting insights. The green area graph represents JST’s performance, while the orange area graph illustrates the index’s performance. Despite an overall semi-strong correlation, evidenced by a Pearson’s correlation coefficient of just 0.66, implying that while JST often follows the index trends, it also has independent factors influencing its performance. Hence, it does not perfectly align with the index movements.
3. Convergence in Price Changes: Because of the tendency to move in tandem with NWSL100, JST has been a reliable representative of the index regarding price changes. This convergence suggests that JST’s price movements have closely followed the broader market trends represented by NWSL100. In other words, general market trends have influenced JST’s price dynamics.

*We elect the member of the NWSL100 crypto index with the most significant jump in our ranking. We will examine how the market rates the project’s progress in case of price changes. It seems important to us whether the project is out of the ordinary tide of crypto project prices. Peer comparison should be efficient and effective, considering an investor’s point of view. 

JUST (JST) Website: https://just.network/#/

JST Large-cap Non Ethereum-based Token is 86th in the 2100NEWS ranking. It is an Index member: NWST1100, NWSL100, NWSTo100, NWSOT50

2100NEWS DA Orderbook Quality Evaluation Grade:  Ordinary, 18.3 (Average for Large-caps: 18.5)

Over the last week, the average market cap was $290.5 million, and the average daily volume was $75.8 million.

*The chart below shows the JST compared to NWSL100 at the top, the box in the middle of the chart shows the original price, and at the bottom, we see NWSL100 and the correlation between JST and NWSL100.