Last week, the EOS price gained traction and broke past key resistance at $5.60, propelling the altcoin into an uptrend that caused it to climb to a high of $6.70 on June 29. At the time of writing, the EOS price was trading at $6.30, although the coin’s daily trade volume is down slightly, sitting at $286 million.
On the eleventh. May markets saw mixed momentum as bitcoin (BTC) recovered from Monday’s decline to $53,000 and reached $56,862, but the digital asset is still finding resistance at the $57,000 mark.
Ether (ETH) also moved back above $4,100, but according to Cointelegraph analyst Marcel Pechmann, the bullish sentiment of recent weeks in ETH is starting to fade as traders question whether the new all-time highs are sustainable in the short term.
Data from Cointelegraph Markets and TradingView shows that bitcoin bulls had a late fall on May 10, which briefly pushed the price of BTC below $54,000, before buyers took sell orders and pushed the price back above $56,000.
4 hour chart BTC/USDT. Source: TradingView
Blue ChipsWhile blue chip crypto-currencies are stuck in a sideways market, dog-themed meme currencies like Shiba Inu (SHIB) and Dogelon Mars (ELON) have followed the same path as Dogecoin (DOGE), and their prices have tripled.
Ethereum bulls take a short break
The fact that Bitcoin has reached the $50,000 to $60,000 mark in recent weeks is partly due to the sharp rise in the price of Ether, which has attracted the attention of institutional investors who want access to more than just BTC. The growing demand for Ether is clearly visible in the price development of the ETH/BTC pair.
Chart 4 hours ETH/BTC. Source: TradingView
According to David Lifchitz, Managing Partner and Chief Investment Officer at ExoAlpha, Ether’s recent all-time high was due in part to Bitcoin’s sustained rotation, which helped push the Ether price to $4,214 before it suddenly crashed to $3,658 (-13% in one hour).
The downturn in the cryptocurrency market coincided with a decline in U.S. equity markets that particularly affected the NASDAQ index, which focuses on technology companies. Lifchitz noted that bitcoin and other cryptocurrencies were eventually able to recover half of their losses from the highs.
While the pullback can be attributed to some correlated trades that led to quick profit-taking in cryptocurrencies, Lifchitz also pointed to the possibility of a more orchestrated pullback where some traders took advantage of exuberant market conditions.
Mr. Leafchitz said:
It could also be an orchestrated sell-off when Ethereum was at ATH levels after a rapid rise (i.e. ETH was vulnerable to a rapid fall) to scare off weak hands and throw them away, triggering a cascading sell-off effect, only to buy back ETH at a low price, as evidenced by the even higher buying volume immediately after the sell-off.
Lifchitz pointed out that only :
Twenty-four hours later, bitcoin is back in the middle of its twilight zone ($50,000 to $60,000) and ether is slowly climbing above $4,000. All in all, it was a typical day in crypto-currency land.
Another insight into last week’s market movement was provided by Ben Lilley, co-founder and analyst at Jarvis Labs, who noted a wave of profit-taking among chains last week, leading to a significant outflow of capital into altcoins.
As capital was transferred from one currency to another, profits were made while bitcoin traded in a sideways trend. What are we doing on the 10th. The month of May marked the end of this phase.
Altcoins are leading the market higher
The overall altcoin market has shaken off the bearish moves of large-cap crypto-currencies. EOS ended the day with a 50% jump to $13.92 after Block.one announced it had raised $10 billion in funding to launch an EOS-based cryptocurrency exchange called Bullish Global.
Daily indicators for the crypto-currency market. Source: Coin360
Yearn.finance (YFI) managed to break out of the trading range it was stuck in and rose 58% to a new high above $80,000, while Revain (REV) exploded 130% to a multi-year high of $0.049.
The total cryptocurrency market is now $2.474 trillion and bitcoin’s share is 42.8%.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Cointelegraph.com. Every investment and every transaction involves risk. So you need to do your own research before making a decision.
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Frequently Asked Questions
Do Altcoins rise with Bitcoin?
No. No they do not. Sure, there are some that may rise and fall with bitcoin (though that isn’t a given), but other alt-coins are not so closely tied to the performance of bitcoin. That said, you can still look at the market capitalization of an alt-coin to get a rough idea of how big the industry is, and you can look at news stories in the alt-coin community to get an idea of what is driving their growth. Altcoins are referred to as “alternative coins”, and were created with the intention of being separate from Bitcoin. For direct payment, they are mostly used with other cryptocurrencies, but are also used for fiat payment to some extent. Bitcoin is a cryptocurrency that was created by Satoshi Nakamoto, and was the first digital currency to solve the double spending problem without the need of a trusted third party or central server. Bitcoin has been in existence since 2009 and has a market valuation of USD 105 billion. Cryptocurrency is created to make it easier to send money to people (especially across borders), without the need of a third party (the middleman).
Does Bitcoin halving affect Altcoins?
The Bitcoin halving is coming soon, and many are wondering how it will affect Altcoins. It is a big event in the world of cryptocurrency, since it will cut the reward miners get for solving blocks in half. That said, it is important to remember that the last halving event did not have an adverse effect on Bitcoin’s price. In fact, it went on to increase significantly. What is Bitcoin halving? In simple terms, Bitcoin halving is a moment in time when the reward for mining a Bitcoin block is cut in half. The Bitcoin network is designed so that every 4 years the amount of Bitcoins rewarded for each block of transactions is reduced by 50%. This is a built-in mechanism to control Bitcoin inflation. The first halving happened in 2012 and was a non-event, as the price rose over the next year. The second halving is expected to happen around June 2016, and it is extremely unlikely that it will be a non-event.
Why are Altcoins tied to Bitcoin?
There are a lot of cryptocurrencies out there, and they all seem to be tied to the price of Bitcoin. How does this work? It turns out that altcoin prices are often tied to Bitcoin for a few reasons. First, if no one thinks that an altcoin is worth anything, then no one will buy or sell it. Second, the person who buys a new altcoin has a choice: to hold it or sell it for Bitcoin. If no one wants to buy the altcoin, then the person will just sell it back for Bitcoin and trade it for Bitcoin instead. Altcoins are cryptocurrencies that are not Bitcoin. However, they are typically tied to other cryptocurrencies – or at least, to Bitcoin. For example, Bitcoin is often used as an intermediary to convert other cryptocurrencies to or from fiat. Why are altcoins tied to Bitcoin? It’s because Bitcoin is the first cryptocurrency, created in 2009. It served as a proof of concept for cryptocurrencies, and showed that there was a use for cryptocurrency.
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