Crypto Market Review, September 6

The cryptocurrency market and its participants are getting ready for the upcoming Merge update on Ethereum that will surely affect almost every digital asset out there. While some coins that will benefit from the transition are increasing, others are desperately trying to regain what they lost earlier.

XRP is not coming on the Merge train

The Merge rally was already happening in the market when the date of the update was released publicly. Numerous assets, including XRP, suddenly gained more than 20% in value.

Due to the speculative nature of the rally, XRP was unable to gain a foothold above the local resistance level and dropped shortly thereafter, now trading at $0.3. From a technical point of view, XRP fell below the important trend line, which previously served as a short-term support level.

At press time, XRP is desperately trying to get back into the trend as it will most likely miss the short-term rally caused by the Merge update if it fails to crawl back above the $0.36 price level.

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Ethereum Classic is in strong rally

In the last 24 hours, Ethereum Classic has increased more than 25% in its value. In addition to the market price, we see a rapid increase in the hashrate of the network. The volatile movement in the market correlates with the Ethereum Bellatrix update – the last step before the Merge implementation.

The key factor behind the massive rally is investors’ belief in the inherent growth of the network after a large portion of Ethereum’s hashrate moved to Ethereum Classic, justifying its reputation as the “true” Ethereum.

Originally, Ethereum Classic was created as a reaction to events that happened to Ethereum back in 2016, when the network suffered a major hack. With each update, both chains moved away from each other and became independent projects.

The Merge update will move two networks even further apart. From all the options, Ethereum Classic will most likely become the “main PoW network” as no other candidate shows such rapid growth in value or hashrate.

Meanwhile, some industry experts believe that a newly forked ETH PoW will beat ETC in terms of hashrate and will most likely be the main way to mine Ethereum.

The US dollar does not stop

Unfortunately for cryptocurrency investors, the rally in the US dollar is nowhere near over as the DXY index continues to climb higher despite what appeared to be a correction yesterday. The reversal pattern on the chart did not work as intended and the currency was still on the rise.

The continuous rise of the US dollar will continue to pressure the digital asset market, considering the main effect, which pushed investors away from risk assets, including cryptocurrencies and other digital assets.

For now, the next event that could push the value of the dollar back to lower levels will be the CPI data release on September 13, which coincidentally happens almost on the same day as Ethereum’s consolidation.