Despite the US Infrastructure Bill's proposed cryptocurrency proposals, the market outlook is still positive despite the small sell-off that occurred early in the week. According to the latest proposal, Proof-of-Work projects would be exempted from customer tax reporting while the DeFi sector would have to report. While much can change in a weekend, the market is still moving forward.
Bitcoin is testing a group of previous highs, all the way back to $43.5k. After having sprung off prior resistance/now support at $37k, Bitcoin is now probing the cluster. BTC's 20-day simple moving Average has moved above the 50-dsma. This highlights the current bout of positive sentiment.
BITCOIN DAILYPRICE CHART (JANUARY - AUUGUST 6, 2021).
On Thursday, the Ethereum 'London" upgrade was completed without any problems, pushing the spot price higher. The convincing breakout of the recent range at $2,500 has allowed ETH to rise even higher. A cluster of previous highs back to $3,000 could slow down the next move higher. However, current sentiment is positive and any pullbacks will likely be temporary.
The spread Ethereum/Bitcoin finally broke through the trend resistance at the start of the week. The spread then moved strongly higher before falling back on Thursday. The spread is expected to move higher, but consolidation may be necessary due to the ongoing Infrastructure Bill discussions. The CCI indicator shows that the trade looks overbought short-term. However, the positive case for the 20-dsma moving higher than the 50-dsma is compelling.