The Meme Coin Revival: SHIB and FLOKI March Higher

Meme coins continued to draw investor interest in the week ending March 10. Shiba inu coin (SHIB) and floki inu (FLOKI) enjoyed impressive gains Monday through Saturday. FLOKI was up 69% to $0.000248, with SHIB up 60% to $0.00003610.

The fear of missing out drove buyer demand after FLOKI and SHIB saw gains of 299% and 133%, respectively, in the week ending March 3.

Dogecoin (DOGE) trailed the pair, rising by a more modest 10.32% to $0.17 from Monday to Saturday. In the week ending March 3, DOGE gained 79%.

Upward trends in active addresses contributed to DOGE and SHIB gains. Exchange listings drove buyer demand for FLOKI.

SEC v Ripple: SEC Appeal Threat Leaves XRP Trailing the Market

XRP bucked the broader market trend Monday through Saturday, declining by 0.43% to $0.6250.

Uncertainty about the outcome of the ongoing SEC v Ripple case continued to limit the upside. The SEC and Ripple are preparing remedy-related briefs to argue for and against a punitive penalty for XRP sales to institutional investors. Judge Analisa Torres could decide on a penalty this summer.

After the penalty stage, investors expect the SEC to appeal against the Programmatic Sales of XRP ruling. SEC plans to appeal may delay an XRP-spot ETF application until after any appeal. An appeal against the Programmatic Sales ruling could extend the SEC v Ripple case into 2025. In July 2023, Judge Torres ruled programmatic sales of XRP do not satisfy the third prong of the Howey Test.

Blackwing has secured a substantial $4.5 million in a recent funding round spearheaded by industry titans Hashed and Gumi Cryptos. This influx of capital is designated for the creation of a modular layer-2 blockchain. What sets this platform apart is its innovative design for leveraged trading sans liquidation, applicable to a wide range of assets through its “Limitless Pools” feature.

Using Initia’s foundational technology, Blackwing stands at the forefront of the modular chains concept. The seamless integration across any application-specific chain not only upholds the sanctity of decentralization but promises traders cost-efficiency and enhanced security. With Blackwing, moving assets across disparate chains becomes obsolete, as traders can operate fluidly within a single, interconnected ecosystem.

Baek Kim, a partner at Hashed, expressed enthusiasm for the initiative, emphasizing the trader-centric advancement in DeFi that Blackwing embodies. Meanwhile, Miko Matsumura from Gumi Cryptos Capital extolled the team’s ingenuity in developing a mechanism that fundamentally elevates the trading experience.

With its Limitless Pools, Blackwing changes leverage trading. The platform transforms liquidity positions into a form of collateral, allowing traders to maintain positions despite market fluctuations. This infrastructure not only augments fee revenue for liquidity providers but also safeguards traders against volatile market conditions.

Amid the fervent debates around decentralization, Blackwing introduces a new breed of modular chain architecture, one that favors a diverse network of specialized app chains. This concept, as envisaged by co-founder Shahmeer, promises a paradigm shift in Web3.

Blackwing is setting the stage for a transformed DeFi landscape where trading complexities are streamlined, empowering traders to focus on their strategic goals without the traditional constraints.

Despite Judge Torres addressing the Terraform Labs case, uncertainty shrouds XRP. As the crypto-spot ETF market evolves, the hanging threat of an SEC appeal also limits the chances of an XRP-spot ETF.

Investors will likely have more clarity on SEC plans in the summer. Judge Torres will begin deliberating on a penalty for Ripple breaching Section 5 of the Securities Act in May. At this stage, the chances of a settlement will likely have vanished. The SEC may begin preparing an appeal that could leave XRP sidelined through H2 2024.

However, SEC plans to appeal against the Programmatic Sales ruling hinge on the outcome of,

• Coinbase (COIN) Motion to Dismiss (MTD) all charges in the ongoing SEC v Coinbase case.
• Office of Inspector General investigation into reported crypto conflicts of interest within the SEC.

There is also the US Presidential Election to consider. A Republican Party victory could result in a new SEC Chair and a material shift in attitude toward regulating the US digital asset space.

Nonetheless, recent price action suggests investors are unwilling to bet on the outcomes of the Coinbase MTD, the OIG Investigation, or the US Presidential Election.

XRP Price Action

Consumer price inflation data from China for February 2024 shows an exit from deflation

CPI +0.7% y/y

• expected +0.3%, prior -0.8% (that -0.8% in January was the sharpest the steepest fall in more than 14 years)
• for the m/m, comes in at +1.0% (prior +0.3%)
• first rise in the CPI since August of 2023
• core CPI +1.2% y/y (prior +0.4%)

PPI -2.7% y/y

• expected -2.5%, prior -2.5%
• for the m/m, comes in at -0.2%

Thats a very large jump in CPI from -0.8% y/y in January to +0.7% in February. Its not as if the yuan collapsed, which would ramp up the price of imports.

Well, that ends the ‘deflation narrative’ in China. This is welcome news, deflation weighs on the economy in multiple ways:

• When prices are falling, consumers may delay purchases in anticipation of even lower prices in the future. This reduction in spending can lead to decreased demand for goods and services, slowing down economic growth.
• Deflation increases the real value of debt, making it more expensive for borrowers to repay loans. This can lead to higher default rates and can stress financial institutions. Individuals and businesses may cut back on spending and investment as a result.
• As prices fall, revenues for companies decrease, but many of their costs (like loans, leases, and salaries) do not adjust downward as quickly. This can lead to lower profits, cutbacks in production, and layoffs, further contributing to the economic downturn.
• Wages tend to be sticky downwards, meaning they do not easily decrease even when there is deflation. This can lead to higher labor costs relative to revenues for businesses, forcing them to reduce their workforce or halt hiring.
• With falling prices, the return on investments can be lower than expected, or even negative. This can lead to a reduction in investments by businesses in areas like research and development, new projects, or expansion.
• The most dangerous aspect of deflation is the risk of a deflationary spiral. This occurs when falling prices lead to lower production, leading to higher unemployment, leading to lower demand, and thus further declines in prices. This vicious cycle can be very difficult to break and can lead to long-term economic stagnation.

Dogecoin (DOGE) and shiba inu (SHIB) outperformed BTC and the broader market.

DOGE and SHIB ended the Friday session with gains of 4.58% and 11.73%, respectively. SHIB ended a three-day losing streak. Despite a three-day losing streak, SHIB is on target for another stellar week. After surging by 133.09% in the week ending March 3, SHIB was up 56.52% Monday through Friday. DOGE was up a more modest 6.55% after rallying 79.39% in the week ending March 3.

Upward trends in active addresses fueled breakouts as investors returned from the sidelines. BTC remained the market barometer, a Friday record high driving buyer demand for meme coins.

However, FLOKI (FLOKI) stole the show on Friday, surging 66.39% to $0.0002323. FLOKI was up 60% Monday through Friday after ballooning 299% in the week ending March 3. FLOKI has benefited from listings on crypto exchanges and endorsements as a long-term investment opportunity.

Coinhako, a Monetary Authority of Singapore-regulated crypto exchange, listed FLOKI on Friday, March 8. CoinMENA also announced the listing of FLOKI on Friday.

Technical Analysis

Bitcoin Analysis

BTC sat well above the 50-day and 200-day EMAs, affirming bullish price signals.

A BTC break above the Friday all-time high of $70,066 would support a move toward the $75,000 handle.

BTC-spot ETF market flows need consideration.

However, a fall below the $67,500 handle could give the bears a run at the $59,176 support level.

The 14-Daily RSI reading, 74.89, shows BTC sitting in overbought territory. Selling pressure may intensify at the Friday all-time high of $70,066.

Bitcoin has recently faced significant resistance at the $70,000 mark, a psychological threshold that has proven to be a formidable barrier for the digital asset. Despite the enthusiasm surrounding its previous rallies, Bitcoin is currently exhibiting signs of a correction, which could impede its ability to achieve a rapid breakthrough above this level.

A detailed analysis of the TradingView chart reveals that Bitcoin has encountered a consolidation phase after a steep ascent. The current local support is found near the $57,932 level, aligning with the 50-day moving average, a crucial technical level that often acts as a stronghold for the asset’s price. This area may serve as a foundation for BTC if bearish pressure increases.

Conversely, resistance is firmly established at the $70,000 level. This is not just a numerical ceiling but a psychological one, where sell orders tend to cluster as investors aim to capitalize on round-number milestones. 

If the correction deepens, Bitcoin may seek support at lower levels, with the next substantial support zone around the $50,117 mark, which is also near the 100-day moving average.

Market sentiment is mixed, reflecting the uncertainty of Bitcoin’s immediate path. While long-term confidence in Bitcoin remains high due to its established track record and increasing mainstream adoption, the short-term outlook is clouded by current market conditions and the $70,000 resistance level.

Solana rises

As the crypto market continues its dynamic course, Solana (SOL) emerges as a robust contender, gearing up to potentially set a new yearly high. With investors and traders eyeing SOL’s chart for signs of its next big move, the digital asset does not disappoint, showcasing strong bullish signals in its recent price action.

The SOL/USDT pair, as observed on the TradingView chart, is currently experiencing a commendable uptrend. The local support is firmly established around the $120.13 mark, a level that SOL has tested and bounced off recently, reaffirming its role as a reliable foothold for the asset. The next critical support lies near the $110 region, aligning with the 50-day moving average, serving as a secondary defense should any bearish shift occur.

On the resistance spectrum, SOL faces its immediate challenge near the $155 zone. A convincing break above this level could very well propel Solana to carve out new highs for the year, fueling bullish sentiment across the market. The current price structure, characterized by successive higher highs and higher lows, underscores the possibility of such a breakout

XRP faces hurdle

XRP is currently facing a significant technical challenge on the charts, as a concerning pattern emerges that could signal potential headwinds for the cryptocurrency. 

The recent price action of XRP/USDT indicates a struggle to maintain its upward momentum. After reaching a peak, the asset has begun to set successively lower highs — a technical pattern that can dampen bullish sentiment and may lead to a trend reversal. This development is pivotal because lower highs are frequently associated with diminishing buying pressure and the beginning of a downturn.

Current technical analysis places XRP’s local support at the $0.55 mark, which is in proximity to the 50-day moving average, a critical juncture for the asset to hold to avert a bearish outlook. Should XRP fall below this support level, the door could open for further declines, with the next level of substantial support near $0.50, a psychological and technical support level.

Conversely, resistance levels have formed near the recent high around $0.63, where XRP has faced rejection, reinforcing the bearish pattern of lower highs. For XRP to invalidate this troubling trend, it would need to break through this resistance with conviction and sustained volume, a move that would require significant market buy-in.

The formation of lower highs is a troubling signal for XRP, often indicating that sellers are becoming more aggressive and buyers are unable to push the price to new highs.

Markets:

• Gold up $18 to $2177
• US 10-year yields down 1.3 bps to 4.08%
• WTI crude oil down $1.07 to $77.86
• S&P 500 down 33 points, or 0.6%, to 5123
• JPY leads, CAD lags

I’m always leery of a pre-NFP front run and today is an example of why. The US dollar was soft and bonds bid for 24 hours before the report. When the data rolled out it was dovish. Yes, the headline beat but unemployment rose, revisions were much lower and wage growth was surprisingly soft. The initial reaction was for more USD selling but that was the extreme of the day. In the hours that followed the dollar weakness slowly reversed, with the help of a weak stock market.

The euro climbed up to 1.0980 on the NFP headlines but slowly slid back to 1.0930, which is slightly before the data was released. It didn’t get any help from the leak saying that only a few ECB members want to cut in April.

The pound was more resilient as it finished up 50 pips on the day but still gave back 50 pips from the highs in what could have been its strongest day since December. Still, it’s the best close of the year for the pond and breaks months of consolidation. That will be something to watch in the week ahead.

USD/JPY continues to be sold on BOJ hike speculation. That will be a key topic next week ahead of the March 19 decision as the leaks continue to roll in.

USD/CAD was a tough trade today. The Canadian jobs report was strong but so much is being driven by population growth that the market isn’t impressed. Later as the risk trade and oil stumbled, so did the loonie, erasing all the jobs moves and more.

Gold hit another all-time high but as it neared $2200, some aggressive selling hit. The turn in gold coincided with heavy profit taking in some high-flying stocks, particularly chipmakers with NVDA falling to $875 at the close from a record high of $974.

Quoting my yesterday’s intraday Gold Trading Alert:

As the USD Index just moved below its late-Feb. low it can now decline even lower – how low? Quite likely to the 102.5 – 102.8 area. That’s where we have the following:

• the 50% Fibonacci retracement,
• the previous lows,
• and the declining support line that was broken in the final days of February.

Before anyone says that the rates might fall in the U.S. and this would make dollar decline, please note that the same thing is the case globally – the ECB just provided the same no-rate-cut-yet-but-sometime-in-the-future narrative. The USD Index is an index that is based on several currency exchange rates, so it’s value is driven by how well the U.S. currency does relative (!) to other currencies. If the situation is bad for the USD but it’s worse for other currencies, the USD Index would be likely to rally, because in relative terms, the USD would be a better choice.

Technically speaking, the USD Index has floor just below today’s lows, so its downside is likely limited. And it’s bottom and the subsequent rally might be the trigger that takes gold lower and that takes our short positions in junior mining stocks to their profit-take levels.

The USD Index just moved even slightly below my target area and now it’s back in it. It seems quite likely that the bottom for the USD Index was just formed.

Therefore, it could be the case that the gold price (that just moved slightly above $2,200) just as mining stocks just formed their local tops, especially that miners are clearly underperforming gold today. The euro is likely topping here as well.

Will gold hold above its previous all-time highs and start a new powerful upleg after the upcoming correction? I’m discussing that in the full version of today’s analysis along with multiple other charts and details.

In a recent article penned by prominent Cardano contributor Rick McCracken, three pivotal priorities for the ADA community in March 2024 have been underscored, with a co-signature from Charles Hoskinson himself amplifying their significance.

McCracken’s insights shed light on critical areas demanding attention from Cardano enthusiasts and stakeholders. Foremost among these is the imperative to update pools to the latest 8.7.3 full P2P version. With a substantial 68% of reporting SPOs already onboard, this patch release addresses a bug in the outbound-governor, fortifying the network against potential vulnerabilities.

Another focal point highlighted by McCracken is the deployment of Mithril, a protocol vital for bolstering Cardano’s defense mechanisms against potential attacks. Presently, only 15% of staked ADA are utilizing this essential feature, with a desired uptake of 60% deemed necessary for robust network security.

Furthermore, McCracken emphasizes the imminent necessity of stress-testing SanchoNet, the testnet geared toward rolling out groundbreaking governance features for the Cardano blockchain. With 23 DReps and 29 stake pools currently engaged, the anticipated Chang HFC event in three months underscores the urgency for rigorous stress and battle testing in the coming months.

Charles Hoskinson, cofounder of Cardano, has lent his weight to McCracken’s clarion call by sharing the article on his social media platforms. This joint endorsement underscores the gravity of the outlined priorities, signaling a unified commitment to fortifying Cardano’s infrastructure and ensuring its resilience in the face of evolving challenges.