Crypto Trading Newsletter – August 6, 2025

Bitcoin & Ethereum Rally as Fed Signals Rate Cuts Ahead

August 06, 2025

The crypto market remains firmly bullish as institutional flows and regulatory clarity drive continued upside. Expect heightened volatility ahead of key Fed commentary, with selective altcoins poised for breakout moves.

Market Overview

The broad cryptocurrency market carries forward last week’s momentum into August, buoyed by strong institutional demand and positive regulatory developments:

– Institutional Inflows: Bitcoin ETFs saw $3.1 billion of net inflows in July, while Ethereum ETFs added $2.8 billion, underscoring mounting institutional conviction in digital assets.
– Regulatory Advances: Final rules for the GENIUS Act stablecoin framework took effect on August 1, formalizing reserve requirements and consumer protections. Anticipated guidance on the CLARITY Act and CBDC Anti-Surveillance State Act is expected later this month, further reducing regulatory uncertainty.
– Macro Headwinds and Tailwinds: The Federal Reserve left rates unchanged at 4.25%–4.50% at its July meeting and signaled potential cuts in late 2025. U.S. inflation cooled to 3.9% year-on-year in July, bolstering the narrative of Bitcoin as an inflation hedge. A softer U.S. dollar amid dovish Fed talk could power additional crypto gains.
– Altcoin Season Continues: Ethereum outpaced Bitcoin for the third consecutive week, and top‐cap altcoins like XRP, Cardano, and Binance Coin are carving new higher lows, signaling the next leg of the altcoin cycle.

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Top Trading Tokens

1. Bitcoin (BTC)

Current Price: $118,500 Trend: Bullish, forming ascending range

  • Resistance: $120,500, $123,000, $125,000

  • Support: $117,000, $115,500, $113,000

  • Indicators: Weekly RSI in mid-70s; MACD shows bullish histogram expansion

  • Signal: BUY on pullback to $115,500–$113,000.
    – TP1: $120,500 TP2: $123,000 TP3: $125,000
    – SL: $112,500

2. Ethereum (ETH)

Current Price: $3,820 Trend: Strong uptrend, slight overextension

  • Resistance: $3,850, $3,940, $4,000

  • Support: $3,730, $3,600, $3,500

  • Indicators: Daily RSI ~80; MACD bullish but flattening

  • Signal: BUY on dip to $3,730–$3,600.
    – TP1: $3,940 TP2: $4,000 TP3: $4,200
    – SL: $3,500

3. Polygon (MATIC)

Current Price: $1.45 Trend: Resurgent layer-2 momentum

  • Resistance: $1.60, $1.75, $2.00

  • Support: $1.30, $1.20, $1.10

  • Indicators: RSI ~65; MACD bullish crossover on daily

  • Signal: BUY on hold at $1.30–$1.20.
    – TP1: $1.75 TP2: $2.00 TP3: $2.25
    – SL: $1.10

4. Solana (SOL)

Current Price: $175 Trend: Altcoin leader with strong TVL growth

  • Resistance: $185, $200, $220

  • Support: $160, $150, $140

  • Indicators: RSI ~70; MACD rising steadily

  • Signal: BUY on pullback to $160–$150.
    – TP1: $200 TP2: $220 TP3: $250
    – SL: $140

5. Optimism (OP)

Current Price: $2.85 Trend: Layer-2 breakout play

  • Resistance: $3.20, $3.50, $4.00

  • Support: $2.50, $2.30, $2.10

  • Indicators: Golden cross on weekly; RSI ~68

  • Signal: BUY on breakout above $3.20 or hold at $2.50–$2.30.
    – TP1: $3.50 TP2: $4.00 TP3: $4.50
    – SL: $2.10

6. Shiba Inu (SHIB)

Current Price: $0.0000285 Trend: Renewed memecoin interest

  • Resistance: $0.0000300, $0.0000320, $0.0000350

  • Support: $0.0000260, $0.0000240, $0.0000220

  • Indicators: RSI ~62; MACD turning positive

  • Signal: BUY on hold at $0.0000260–$0.0000240 or breakout above $0.0000300.
    – TP1: $0.0000320 TP2: $0.0000350 TP3: $0.0000400
    – SL: $0.0000220

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Education for Newbies

How Blockchain Scaling Works
Scaling means making blockchains faster and cheaper as more people use them. Here’s how:

  • Layer 1 Improvements: Upgrade the main blockchain’s design to process more transactions at once. Think “widening the main road”—like sharding, which splits traffic into lanes, or tweaking consensus rules for speed.

  • Layer 2 Solutions: Create “fast lanes” beside the main road, where transactions are bundled off-chain and sent back as a summary. Examples are rollups (grouping transactions together) and state channels (tabs between users).

  • Sidechains: Build separate roads that connect to the main one. Tokens can move between chains, letting overflow traffic move faster, though sometimes with different rules.

Bottom line:

  • Layer 1 = Better main road

  • Layer 2 = Express lane

  • Sidechains = Connected overflow road

Together, they help blockchains stay quick and affordable as they grow.

Here’s a real-world example: When a popular NFT collection launched on Ethereum, transaction fees skyrocketed and network congestion slowed everything down—Layer 2 solutions like rollups allowed users to mint NFTs quickly and cheaply by processing most actions off the main chain, then recording the results securely on Ethereum.

Disclaimer

All prices and trade recommendations reflect market data as of 6th August, 2025, and are for informational purposes only. Crypto trading carries significant risk. Always conduct your own research and consult a financial advisor before investing.

Trade strategically, manage risk relentlessly.