Crypto market capitalisation hovers around crucial moving average

The total crypto market capitalisation has been stuck in a narrow range for weeks. Weekly candles are getting smaller, which according to analyst DaanCrypto is a sign that a bigger move is coming. The only question is: which direction will it take?

Compression around the weekly 200 moving average

The total crypto market capitalisation currently sits around $2.16 trillion and has been moving sideways for some time. On the weekly chart it is clearly visible that the price is fluctuating near the weekly 200 moving average, a level that many traders consider an important reference point. The longer the market lingers around this level, the greater the chance of a breakout in one direction or the other.

Two clear levels can be seen on DaanCrypto’s chart. On the downside, there is a support zone around $2.05 trillion, which has been tested multiple times in recent months. On the upside, resistance sits at approximately $2.74 trillion, a level where the market previously bounced off. As long as the price moves between these two levels, little directional movement is expected.

Big move coming according to analyst

DaanCrypto states that the increasingly smaller weekly candles point to growing compression. This pattern has historically preceded a larger price move. At this point it is not yet possible to say with certainty whether that move will be up or down, but the analyst recommends paying close attention to any breakout from the current range.

The broader market conditions also play a role. For instance, Blockchainstories reports that a rising oil price could be bad news for crypto and other risk-on assets. Additionally, news of a hack at payment service Triple-A, in which $97 million was stolen, does not boost confidence in the market. Traders would be wise to stay alert for a breakout in either direction over the coming weeks.