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Bitcoin and the entire crypto market seems to have taken a breather as the major crypto tokens trade almost unchanged. Meanwhile, investors are looking for signs that Bitcoin’s downward spiral has reached its end point and that the largest cryptocurrency by market capitalization is poised to enter a new bull cycle.
With the exception of Cardano and the USDC stablecoin, all the other eight of the top 10 digital tokens traded down on the morning of January 17th. Meanwhile, Cardano has grown by more than 12% and became the fifth largest token by market capitalization.
The capitalization of the global cryptocurrency market remained virtually unchanged and amounted to 2,07 Ttrillion dollars compared to the previous day. However, the total volume of the crypto market increased by 5% to $64.30 billion.
September 12, 2021 The Cardano Alonzo update has been deployed. The Alonzo update provided the Cardano network with smart contract capabilities. Simply put, this meant that Cardano had to see an influx of Dapps on its network. Ahead of the update, ADA Cardano reached an all-time high in $ 3.12a. However, no Dapps were released, causing the price of ADA to drop by more than 60% for 4 months.
But there could be a reversal for Cardano as Sundaeswap, a decentralized exchange with a huge following, plans to launch its mainnet through 3 days (January 20).
“With the launch of Dex, people will be able to see the power of Cardano and there could be a price spike. In short, we should expect some volatility,” added IONK CEO Charles Hoskinson.
According to BitPay Inc, one of the world’s largest cryptocurrency payment processors, consumers and businesses are increasingly using digital tokens other than Bitcoin to make purchases.
For more than a year, cryptomania has reached its zenith. Cryptocurrencies such as Bitcoin and Ethereum have skyrocketed in value.
Cryptocurrency assets like NFTs have skyrocketed. Jack Dorsey, founder of Twitter, recently renamed one of his companies Block, after blockchain, the distributed ledger system that powers digital currencies. Melania Trump auctioned off her own NFTs.
But for some, the cryptocurrency craze has gone too far, too fast. Skeptics argue that cryptocurrencies and related assets such as NFTs are digital Ponzi schemes that are artificially priced above their true value.
Movements of Bitcoin and the rest of the market
The fall in cryptocurrency prices continues. Bitcoin spent most of its weekend roughly where it started, hovering just above $43,000. This level was slightly better than at the beginning of the week, but well below the highs of two months ago. Trading was light as investors looked for signs that Bitcoin’s downward spiral has reached its end point and that the largest cryptocurrency by market capitalization is poised to enter a new bull cycle. Ether and most other altcoins have followed a similar sluggish pattern.
Over the weekend, Bitcoin was in an unstable zone without a clear trend. Volumes were also missing, and the inability of BTC to overcome $45,000 is a sign of his inherent weakness. When Bitcoin experiences a sharp drop, investors and traders look for aggressive buying to confirm the bottom and reversal; however, we haven’t seen much of this as BTC briefly dropped below $40,000.
The crypto market is facing challenges as the Omicron variant of the COVID-19 virus is rampant, and many businesses are grappling with supply chain issues and the rising cost of raw materials. The US central bank also said last Wednesday that inflation reached 7%, the highest level in 40 years.
Bitcoin is unlikely to start to rise sharply, although it should be noted that expiration of the following options on January 28 can serve as a “possible trigger” for the price increase of the leading crypto asset up to $50,000.
Bitcoin daily price chart shows support/resistance with RSI at the bottom
Bitcoin buyers are trying to reverse the two-month downtrend. Cryptocurrency fell by about up 30% from an all-time high of around $69,000 in November, and now the technical indicators suggest that the sell-off is starting to stabilize.
BTC rose by about 3% last week, although the recent decline in trading volume suggests that large price swings could occur.
Support is visible near the price level in $40,000, which could limit pullbacks in the short term. However, the upside potential may be limited by the resistance zone $45,000-$47,000 weekend.
The Relative Strength Index (RSI) on the daily chart is rising from oversold levels, similar to what happened at the end of September, which preceded the price rally. However, this time the upward momentum is starting to wane on the weekly and monthly charts, making significant buying less likely.
Posted by Newt Salamander, Analyst Freedman Сlub Crypto News
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