Bitcoin: buying the dip and ready to hold
April 28, 2022 @ 10:40 +03:00
Bitcoin found buyers’ support Wednesday morning after touching levels below $38K, followed by a relatively calm rise to $39.4K as of Thursday morning with a strengthening of 2.4% in 24 hours. Ethereum added 1.4% over the same interval, with the other leading altcoins in the top 10 showing mixed dynamics, ranging from a 0.6% decline (XRP) to a 2% gain (Solana).
The cryptocurrency Fear & Greed Index was up 3 points to 24 by Thursday but remains in “extreme fear”.
Total cryptocurrency market capitalisation, according to CoinMarketCap, rose 1.6% overnight to $1.8 trillion. Bitcoin again finds itself one step ahead of the cryptocurrency market, being not only its largest representative but also its locomotive. Bitcoin’s dominance index has added 0.3% to 41.5%.
Short-term, Bitcoin has gained support on the decline to an important support area, withstanding an onslaught of sellers since late February. But at the same time, it remains below the support line of the last ten months, hinting at a pause in the decline but not a final victory for the buyers.
For its part, bitcoin has been helped by the US stock market, where buyers have stepped up on the S&P500’s decline in the February and March lows. The stock market is now acting as a guide for the first cryptocurrency.
However, it is hardly fair to say that the cryptocurrency market is entirely secondary. There are some reasonably internal solid drivers out there.
For example, bitcoin supply in the market has been falling steadily, reaching late 2018 levels, Arcane Research notes. Active BTC hoarding is causing a shortage in the market and pushing exchange prices upwards. Virtually, bitcoin holders are getting richer from these community tactics.
The crowd is buying back the decline to local lows and intends to hold bitcoin for some extended period.
Fort Worth in Texas was the first US city to start mining bitcoin at the initiative of a millennial mayor. In doing so, the city promises not to sell the coins.
US crypto investor Grayscale said it is considering entering the European market amid an expanding market for digital assets.
The mayor of Buenos Aires has called for blockchain technology to make tax collection more efficient.
US research firm NBER reported that 60% of Salvadorans stopped actively using the Chivo wallet after spending a welcome bonus in BTC. This result is called a failure of the bitcoin experiment.
The developers of the Cardano blockchain have increased the block size by 10%, to 88Kb. This should improve the bandwidth and performance of decentralised applications on the network.
The FxPro Analyst Team