Week Ahead: Ethereum and DeFi to come under spotlight this week
- Bitcoin likely to continue its recovery rally to $70,000.
- Ethereum ETF approval deadline could cause ETH-based altcoins to take off.
- Nvidia earnings coupled with ASI launch could see AI tokens rally as well
Bitcoin’s (BTC) attempt at a comeback has stirred the pot, causing altcoins to become volatile again. With the US Securities and Exchange Commission (SEC) set to make its decision on Ethereum ETFs this week, some sectors of altcoins might see higher liquidity and volatility than others.
Read more: Bitcoin Weekly Forecast: Is BTC out of the woods?
Bitcoin outlook to help traders
Currently, BTC trades at around $67,000 in the early Asian session and is poised to push into the daily imbalance, extending from $67,937 to $70,024. This zone also harbors the 2021 all-time high (ATH) at $69,138, coupled with the declining trend line connecting the swing highs formed since Mar 14. These two key levels will serve as resistance to the ongoing uptrend.
- A rejection here could likely cause altcoins to crash again and the new-found hope to crumble.
- Bitcoin price swiftly breaches the confluence of resistance and attempts to retest the ATH at $73,949.
The first scenario could see a major red streak across the markets, with altcoins posting double-digit losses. However, if the second outlook plays out, certain sectors of altcoins will witness a massive uptick in liquidity and volatility.
BTC/USDT 1-day chart
This week’s crypto events
- May 21 - Chiliz Dragon8 hard fork
- May 22 - Nvidia earnings
- May 23 - VanEck Ethereum ETF approval deadline
- May 24 - Ark 21Shares Ethereum ETF approval deadline
- May 24 - Fetch.ai, Singularity.net, Ocean Protocol collaboration - ASI Launch
- May 24 - OpenBook user sell pressure ends for Bonk
Altcoins that could rally
As seen above, the most important event this week is the SEC’s decision on the Ethereum ETF applications from VanEck and Ark 21Shares. Hence, ETH-based altcoins like Ethereum Classic (ETC), or Layer 2 scaling solutions like Polygon (MATIC), Mantle (MNT), and Decentralized Finance (DeFi) sector tokens like Lido DAO (LDO) Chainlink (LINK), and so on.
Read more: Ethereum drops below $3,000 again, spot ETH ETF sparks debate in crypto community
In addition to the ETH-based altcoins, AI coins could see a massive spike in investor interest due to the upcoming Nvidia earnings report on May 22. Furthermore, the ASI launch could see Fetch.AI (FET), Singularity.net (AGIX), and Ocean Protocol (OCEAN) shoot up.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
