While Bitcoin consolidates, altcoins are catching up
May 28, 2019 @ 17:24 UTC
Bitcoin’s Sunday rally lost momentum closer to $9,000. Over the past 24 hours, Bitcoin shows almost zero dynamics and trades above $8,700. But the fact that the bears could not seize the initiative can be considered as good news. On its way to the current level, Bitcoin broke several resistances, therefore, the fact that the market is consolidating again is not surprising.
Since the beginning of April, a certain pattern of Bitcoin behaviour has become noticeable: growth spurts are followed by consolidation or a short correction and then, by a new growth impulse. In case of further growth, the area of attraction for buyers may be $9,600-$10,000. Where $9,600 is the peak level of April-May 2018, and $10,000 is an important psychological round level, as the dynamic of the last two months often captures close to round levels, that attracts the public’s attention.
In addition, along with sharp price growth, trading volumes increased by $10 billion, which can also be considered as an anther positive factor.
It seems that investors paid attention to the undervalued altcoins, increasing their purchases. Against the background of the current lull, the positive dynamics of ZCash (ZEC) is particularly noteworthy. this cryptocurrency spiked almost 12% to $85. It is also worth highlighting the 16% growth of the EOS coin. Overall Bitcoin dominance index sank from 60.4% to 56.7% over the last two weeks. The experience of 2017 indicates that this is directly related to the growth of the cryptocurrency market as a whole.
Along with rising prices, mining returns to the focus of market participants due to the rapid growth of its profitability. Miners turn on old equipment, and it makes sense to buy new ASICs.
At the same time, market participants with great concern are watching the movement of “whale” funds. A recent transaction of 15,000 BTC ($130.5 million) alarmed the crypto community, as it may indicate that whales are preparing for sale. Coincidence or not, the spring rally began shortly after a large transaction of comparable size.
The FxPro Analyst Team