The crypto market has recently warmed up, and multiple tracks are worth following.

In the past week or so, positive signals have emerged in the traditional financial market, and the crypto market has also welcomed a phase of recovery. In July, the US CPI data recorded 8.5%, below market expectations. Compared to the record high of 9.6% a month ago, inflationary pressures have eased.

From the perspective of wealth loss, this year's crypto market decline exceeds that of any historical bear market. The May collapse of Luna directly wiped out $60 billion in market value, triggering a series of chain reactions. The rapid drop in the prices of Bitcoin and Ethereum led to a crisis for Three Arrows Capital, and in June, the total market value of the crypto market fell by another $10 billion, with several large CeFi institutions going bankrupt, as the market experienced deleveraging.

The good news is that a large-scale sell-off is unlikely to happen again in the short term, and the bottom formed by this event may become a strong support in the future. In the next period, the market may experience sideways fluctuations, especially with Bitcoin's rebound possibly lagging behind the clearer narratives of altcoins.

Ethereum

ETH has recently led the crypto market, outperforming Bitcoin and other major coins. Merge-related tokens such as OP, Lido, GMX, etc., have also performed well. Layer 2 tokens are worth paying more attention to during the merge period; OP has validated this judgment, and Arbitrum may follow a similar path in the future.

Currently, Ethereum is the main liquidity asset available for institutions to stake in the merger, possessing a better narrative. The independence of the crypto market is rising, and after a recent rebound, there is a clear differentiation; most altcoins have not yet recovered the first rebound peak after the Luna crash, while Bitcoin and Ethereum are in better shape.

From a technical perspective, ETH below $1800 is worth buying. If it breaks the $1650 support, caution is needed; it may test $1000 again. If the $1650 support holds, ETH is expected to recover to $2000 during the merger in mid-September.

DOGE & SHIBA INU

The flat movement of DOGE/BTC means that the market is facing a choice: either the last wave of rotation of altcoins in a bear market rebound, or a new round of explosive market conditions is about to arrive. Currently, the latter possibility is higher.

DOGE/BTC has historically been an indicator of retail investor entry. Recently, discussions around retail stocks, including AMC, have surged, and the WallStreetBets community is active again. The Dogecoin ecosystem has added Dogechain, enhancing the narrative. Although Dogecoin lacks technical innovation support, it often manages to jump the gun before market movements.

From a technical perspective, DOGE has broken through the upper boundary of the range it has been oscillating in for the past few months. In the short term, confirming the retest of the breakout position is crucial. Google Trends data shows that the current attention on Dogecoin is still relatively low and has not yet reached the point of reversing the upward trend.

Solana

Solana is one of the best-performing public chains in 2021, processing all transactions directly on layer one. Its low cost is very attractive to ordinary users, but it has also led to multiple network outages. Solana needs to develop DeFi applications to further enhance its capabilities. Drift and Friktion have made some progress, but there is still a lack of high TPS gaming applications.

The latest network upgrade has implemented Quic/Qos/localized fee market, which helps alleviate network congestion. Technically, a breakthrough at $48.5 will open up upward space. The ideal buying point is if the support area of $40-42 holds, but caution is needed if it falls below $39.15 due to the risk of a new round of rapid decline.

Chilliz

Chilliz is a successful case connecting sports entertainment and encryption, collaborating with well-known clubs such as Barcelona and Juventus. Its Socios.com app allows fans to interact with teams. Recently announced a partnership with Barça for NFT and metaverse plans. CHZ has performed strongly recently, outpacing most ERC20 tokens.

At the end of the year, the Chilliz 2.0 public chain will be launched, providing a one-stop platform for teams to interact with fans. If successful in the US market, it is expected to dominate the NFT x fans x sports market.

CHZ has broken through the downward trend line of nearly one year, with resistance at $0.30 above. As long as it holds the support at $0.15-$0.17, the upward momentum will continue.

XMON

Sudoswap is known as the Uniswap of the NFT market, aiming to improve NFT liquidity. It allows users to create different pools and set dedicated curves, fully decentralized and free. In just one month after launch, its sales reached one-tenth of OpenSea, indicating significant growth potential in the future.

Market Outlook

The worst period of the market may be over, and new lows are unlikely to appear before the Ethereum merger. However, risk hedging is still necessary, and Bitcoin can serve as a short hedging asset in the short term. Once anxiety about an economic recession subsides, market liquidity will quickly return.

Mainstream assets worth following: ETH, SOL MEME Coins: SHIB, DOGE High potential asset: CHZ Medium potential asset: XMON Risk Hedging: BTC, APE

Future market hotspots may include:

• Sol 2.0 and the localized fee market
• Optimistic Rollups v2
• Privacy DeFi
• sudoSwap and Dogecoin
• Cross-Chain Security
• Cross-chain account interoperability
• On-chain options
• zkEVMs
• New public chains such as Aptos, Sui
• Cross-chain communication
• Celestia and Sovereign Rollups
• Modular execution rollups
• Blockchain game

Overall, the market is expected to remain in good shape over the next month. If the macro environment improves further, it is necessary to seize emerging narrative opportunities in a timely manner.