Market Wrap: Altcoins Outperform as Sentiment Improves; Bitcoin Within ‘Value Zone’
Bitcoin (BTC) and other cryptocurrencies rose on Tuesday as gloomy sentiment from the previous week faded.
Most alternative cryptocurrencies (altcoins) beat bitcoin, indicating that traders have a higher appetite for risk. For example, THORChain’s RUNE token has increased by 11 percent in the last 24 hours, compared to a 2 percent increase in BTC. Decentralized finance (DeFi) currencies like AAVE and EOS, on the other hand, climbed more than 7% on Tuesday.
The bitcoin Fear & Greed Index saw a modest gain on Tuesday, indicating that sentiment is improving among crypto traders. Even so, since BTC trades in a narrow range between $32,000 and $46,000, some buyers remain on the fence.
On Tuesday, stocks surged as the 10-year Treasury yield increased to 2.9 percent, the highest level since late 2018. Over the last 24 hours, gold, a classic safe haven asset, has traded lower, reflecting a small risk-on tone in global markets.
Bitcoin’s price range
According to blockchain data provided by Glassnode, a significant quantity of bitcoin supply has been accumulated between the $38,000 and $45,000 price range. Price “value” zones, or places with a lot of trading activity, usually come before big price breakouts or crashes.
In a blog post, Glassnode said, “Despite another two months of sideways consolidation, a big segment of the market is unwilling to spend and sell their coins, even if their coins are held at a loss.” This indicates that price-insensitive traders own a large portion of bitcoin’s supply above the $40,000 price point.
Long-term price momentum has weakened thus far, therefore it’s unclear whether traders will continue to discover appealing buying positions between $35,000 and $42,000. A breakout or breakdown of the current price range is required from a technical standpoint to confirm a trend shift.