Throughout March, a handful of crypto assets and tokens have consistently outperformed Bitcoin, recording gains in the 50 percent to 100 percent range against the U.S. dollar.
Due to the reported partnership between Samsung and Enjin, for instance, Enjin Coin and other cryptocurrencies related to the project such as Kyber Network and Bancor demonstrated a significant increase in value.
Bitcoin Price Will Benefit From It
According to cryptocurrency trader Josh Rager, based on the historical trend of the cryptocurrency market, the price surge and newly established momentum of crypto assets may fuel Bitcoin in the near-term.
Following a large movement in the cryptocurrency market, traders tend to hedge their investments and cash out their returns from high-risk trades to Bitcoin, often pushing up the price of the dominant cryptocurrency.
In recent weeks, Litecoin recorded a 25 percent increase, Enjin Coin surged by 375 percent, and Kyber Network rose by 92 percent.
Other cryptocurrencies involved in the Enjin project recorded similar gains in a short time frame.
“Cryptocurrency wallets like Enjin are an important gateway for people who are new to blockchain and cryptocurrencies, and this is one area Kyber has supported from the start. This successful integration with Enjin is a testament to how Kyber allows decentralized token swaps to be embedded into any wallet and Dapp for a seamless user experience,” Kyber CEO Loi Luu said in February.
The stability in the price of Bitcoin has allowed many alternative cryptocurrencies to surge in value and in the future, as traders move their holdings from crypto assets too Bitcoin, the price of BTC could be next to rise.
Current sideways BTC movement has allowed altcoins to have a nice run. Expecting altcoin profits to eventually move into Bitcoin for a push up in BTC price.
Bitcoin profit taking should follow leading to the next drop, in my opinion. And the timing of this movement is unpredictable.
On the technical side, Bitcoin has tested the $4,000 resistance level several times in the past two weeks but has struggled to cleanly break out of the $4,000 mark.
Until Bitcoin shows strong momentum in the $4,000 to $5,000 range, traders have said that the asset could be vulnerable to a fall to the mid-$3,000 region once again.
“A new week in Bitcoin – similar volume to last week, This line (log) which has acted as strong support previously and now as strong resistance on the first backtest. A second touch puts #bitcoin right above $4,000,” one trader said.
In the short-term, it is key for BTC to test $4,000 and eye a movement to $4,200, fueled by the rally of alternative cryptocurrencies.
If it fails to climb above $4,000, as seen in previous instances wherein BTC demonstrated an extended period of stability and plunged by a large margin, the asset could slide to previous lows.
In an interview with CCN.com on March 10, a technical analyst known as “Bleeding Crypto” suggested that a fall to $1,850 remains a possibility for BTC.
Bitcoin is in a “Powerful Accumulation Zone”
The cryptocurrency market has failed to use the momentum generated from last week’s strong performance to climb up.
Assets like Kyber, ICON, Theta, VeChain, and Ontology, which recorded large gains against both BTC and the USD throughout March, retraced by 5 to 15 percent.
But, the daily volume of the cryptocurrency exchange market remains relatively high at over $30 billion and in the past week, the valuation of the crypto market rose by $8 billion.
David Puell, a Bitcoin analyst, said that BTC is most likely in a “powerful accumulation zone” and it still has room to establish a solid support level in the $3,000 region.
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Last modified: March 4, 2021 3:19 PM