Market reluctantly starts a recovery

• The cryptocurrency market may be vulnerable to the golab developments.
• Bitcoin settled above $9,400, still below the channel resistance.

The cryptocurrency traders were bracing for an increased volatility during the weekend; however, Bitcoin and all major altcoins stayed sidelined inside the current ranges. Despite a clear bearish pressure on Saturday, May 20, Bitcoin managed to stay above $9,2000 and recovered to the area above $9,400 during early Monday hours. The total capitalization of all digital assets in circulation increased to $267 billion, while an average daily trading volume is registered at $57 billion. 

The global markets is a mixed picture on Monday morning as the U.S. stock futures recovered some losses, but the Asian indices are under pressure amid worries about the second wave of the coronavirus cases in the United States and growing economic uncertainty. 

The massive fiscal and monetary stimulus programs launched all over the globe stopped the carnage and helped to return the stability to the markets. However, the situation may change any minute if economic data deteriorates significantly or new evidence of the second wave of COVVID-19 come up. Hirokazu Kabeya, chief global strategist at Daiwa Securities, commented as cited by Reuters: 

The market is surprisingly resilient. Perhaps many investors think the uptrend is in place. But we need to keep an eye on rising coronavirus infections in some countries.

As the stock market valuations reached the highest levels since 2002, compared with projected earnings in the coming 12 months, experts warn that investors may be overly optimistic and in for a bitter disappointment. Takuya Hozumi, investment strategist at Mitsubishi UFJ Morgan Stanley Securities said: 

The market has been pricing in a rapid recovery, so I doubt there are much upside gains to be made. We now need to see whether the earnings outlook will meet up with expectations.”

If the global financial markets take a U-turn, BTC/USD and other digital assets won’t be left unaffected. Bitcoin may drop initially amid Broadband sell-off caused by risk-off sentiments. However, considering Bitcoin’s low correlation with traditional assets, it is likely to rebound quickly and set off for another bullish wave.

ETH/BTC Daily Chart

The ETH/BTC pair is currently trading at the price level of 0.0249. The price touched the initial resistance of $0.0250 that needs to be cleared before we can see an extended recovery towards 0.0252 and $0.0255, which is the highest level since May 30. Meanwhile, the local support is created by $0.0244. The second barrier comes at 0.0235, and the third one at 0.025. The RSI on a daily chart points upwards, which implies that the price may continue moving within the bullish scenario.

BTC/USD Daily Chart

The BTC/USD is currently trading at the price level of $9430 while moving within a short-term bullish trend amid shrinking volatility. Above the current price, the first resistance level comes at $9,500, This barrier is created by the upper line of the consolidation channel that dominated form the most part of the previous week. The second resistance is psychological $10,000. It is followed by the recent recovery high of $10,412 and the highest level of the year $10,511. Below the current price, the first support level is at $9150 (the lower line of the daily Bollinger Band), then comes $8,750 (weekly SMA50) and $8,250. The RSI has starter reversing to the upside, which is a positive signal for the bulls.

ETH/USD Daily Chart

The ETH/USD pair is currently trading at the price level of $234.9 and remains below the critical resistance of $24.00.  Above the current price, the first resistance level is at $235, then the second at $240 and the third one at $245. Below the current price, the first support level is at $230, then the second at $220 (daily SMA50) and the third one at $200.

.XRP/USD Daily Chart

The XRP/USD pair is currently trading at $0.1879 and locked in a tight range under the psychological $0.1900. Critical support for the current scenario is at $0.1800, if it gives way the sell-off may start snowballing. Above the current price, the first resistance level is at $0.1900, then the second at $0.1955 (the middle line of the daily Bollinger Band) and the third one at $0.2000. This psychological barrier is reinforced by daily SMA50. Below the current price, the first support level is at $0.1855 (the lowest level since May 15), then the second at $0.18 and the third one at $0.1630