Cryptos that achieve lower and lower maximums are not so bad after all

Cryptocurrencies have been on the wild for the past few months, but, as it turns out, they haven’t actually traveled very far.

Digital assets are experiencing lower declines and declines since reaching a peak of around $ 3 trillion in November. In total, prices have been constant over the past seven months and while changes in early 2022 are not dramatic by historical standards, “the most interesting outcome for this year’s price action would be lower volatility, regardless of the size of gains or losses in both directions.” Bespoke Investment Group analysts.

Cryptocurrencies are known for their volatility – prices can swing whether they like it or not in one direction or another without much solid catalyst.

Over the years, many institutional and retail investors have shunned them precisely because of this factor, so lower volatility could mean the crypto investor base expands as price fluctuations become more subdued despite the frustration of professional traders.

“For most people, it is difficult for an instrument to be a long-term financial game of trust if it has incredible volatility,” said JJ Kinahan, chief market strategist at TD Ameritrade. “It just makes people too nervous or too nervous to be involved at all, so the more stability such a product starts to see, the more it will attract a wider audience.”

Bitcoin, the largest cryptocurrency by market value and a poster-diet for volatility, has entered the new year and is trading below the average price in the last 200 sessions this week. It is a key technical indicator to which investors are paying attention to signs of where they could move next. Bitcoin weakened on Monday, but recovered as much as 3.3% on Tuesday and traded around $ 47,519.

And the coin’s recent poor performance has led to its overall share of crypto market dominance falling to 39.5%, the lowest level in nearly three years, according to Arcane Research.

Katie Stockton, founder and executive partner of Fairlead Strategies, a research firm focused on technical analysis, said bitcoin could see support at $ 44,156, although closing above $ 46,334 on Tuesday would confirm a signal of the opposite trend. If that happens, the coin could potentially experience resale and could test $ 55,644 again, she wrote via email.

© 2022 Bloomberg LP

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