Multiple altcoins record double-digit gains as BTC trades sideways
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(Kitco News) - The cryptocurrency market is showing hints that an altcoin season is underway after crypto traders responded positively to the latest comments from Fed Chair Jerome Powell, who said the "disinflationary process" in the U.S. economy has begun while also warning that further rate hikes are likely to be required.
The comments from Powell made for a choppy day of price action in the traditional markets as the S&P, Dow and Nasdaq all experienced a price whipsaw in the early afternoon but managed to finish the day on a positive note, closing up 1.29%, 0.78%, and 1.90%, respectively.
Data provided by TradingView shows that Bitcoin (BTC) reversed course from Monday’s late night low of $22,658 to steadily climb higher in trading on Tuesday, hitting a daily high of $23,355 in the early afternoon before pulling back to support at $23,200.
BTC/USD 1-day chart. Source: TradingView
According to Kitco senior technical analyst Jim Wyckoff, “The price uptrend on the daily bar chart has stalled and the bulls need to show fresh power soon to keep it alive and to keep their near-term technical edge.”
Analysts at Arcane Research noted in this week’s ‘Ahead of the Curve’ newsletter that Bitcoin has seen a weekly return of 0% for the second consecutive week as the top crypto remains in consolidation. This has given room for some small-cap altcoins to “realize significant upside over the past week as the market rotates into risk.”
“The dull price action of late has caused market activity in BTC to stagnate as BTC spot volumes when excluding Binance, have fallen by 42% decline over the past week,” the report said. As a result of the rotation into risk, Bitcoin dominance has fallen by 0.9%
While all crypto indices and BTC have recorded notable 30-day returns, the market, apart from the Small caps index, has stagnated since Jan. 22, arcane research said.
Crypto analyst Rekt Capital likewise highlighted that the stagnant price action for Bitcoin over the past couple of weeks had given altcoins a chance to put on some gains ahead of a potential breakout past the macro downtrend, a pattern that was experienced near the end of the previous crypto winters.
#BTC consolidation at highs so as to enable Altcoin rallies followed by a breakout past the Macro Downtrend to confirm the new Bull Trend?— Rekt Capital (@rektcapital) February 7, 2023
Definitely a scenario to look forward to$BTC #Crypto #Bitcoin pic.twitter.com/NS4VlMG8Cn
And a bit of insight into which price levels to keep an eye on amid the rising volatility was provided by market analyst Michaël van de Poppe, who posted the following Tweet suggesting that Bitcoin could soon climb into the $26,000 - $28,000 range.
#Bitcoin still eagerly holding the levels of the range-low.— Michaël van de Poppe (@CryptoMichNL) February 7, 2023
I'm still favouring a sweep of $21.7K as the most optimal long entry, but people are so hyped to get in the markets that most-likely we won't get it.
In that regard, continuation to $26-28K seems likely.
Altcoin season ramps up
Evidence that an altcoin season is underway continues to increase by the day as multiple tokens experienced double-digit breakouts on Tuesday while Bitcoin traded sideways near $23,200.
Daily cryptocurrency market performance. Source: Coin360
The best performance of the day was recorded by The Graph (GRT), which climbed 64.36% to hit a high of $0.228, followed by a gain of 27.7% for SingularityNET (AGIX) and a 20.23% increase for Fetch.ai (FET).
The overall cryptocurrency market cap now stands at $1.085 trillion, and Bitcoin’s dominance rate is 41.3%.