Bitcoin (BTC) has made significant moves already this year but altcoins are catching up. Once Bitcoin’s price starts to stabilize, the market environment becomes better for altcoins to begin their run.
One of the strongest performers in 2021 is Polkadot, as this cryptocurrency has been making new all-time highs day in, day out. Polkadot’s price rallied by 85% in 2021 and 75% in the past seven days, surpassing XRP in market capitalization.
DOT price eyes $20 or higher after this rally
The daily chart of Polkadot shows a rounded bottom construction throughout the last quarter of 2020. Since then, a beautiful support/resistance flip took place at the $4.55 level, leading to more upside.
This upward continuation kicked off with a massive rally to $10, after which demand (grey box) held for support and new levels were able to be defined using the Fibonacci extension.
One of those regions was found at $14.25-14.75, and the second one is found at $16-17, as the chart shows.
The primary question currently is whether DOT has finished its current run. If that is the case, areas of interest for support/resistance flips are found at the 0.35-0.382 and 0.618-0.65 Fibonacci levels.
These Fibonacci levels are often used to predict where such corrections will potentially reverse course. In Polkadot’s case, these align heavily with previous support or resistance levels, namely the $13 and $10.50 areas. This is where traders should be watching for potential buy-the-dip opportunities.
Once again, Polkadot will most likely only correct when Bitcoin starts to drop significantly. Otherwise, Polkadot and many other altcoins are currently in a good position for more upside.
However, if a correction occurs and Polkadot bottoms out, new levels of interest can be defined on the charts for the next impulse move. In that case, Polkadot might continue its surge towards $23-24 and possibly even $32-35 at a later stage in the year.
DOT/BTC approaching critical resistance zone
The daily chart of Polkadot in the BTC pair shows a massive surge in recent days. However, this surge is approaching a significant resistance zone.
It’s common sense and should go without saying but it’s not advised to enter a trade right as the price moves into the resistance zone.
The 0.00045000-0.00047000 sats area is a critical area to breakthrough as that would trigger another heavy impulse move upwards. If that area breaks and flips for support, continuation is likely toward price discovery for Polkadot.
However, the price will most likely fail to break upward here. In that scenario, a healthy correction is possible through traders should be watching the 0.00035000 sats region, but also the 0.00031500-0.00032250 zone.
The $15 support level is vital
The 2-hour chart shows a heavy uptrend, but some critical levels must hold for this rally to continue.
In that perspective, the previous high at $15 has to sustain support. If that area holds, a renewed rally to $20 or higher is on the tables to occur for Polkadot.
Failing to hold the $15 area for support and a significant correction is on the table. The next areas for support are $12 and $10.75-11.25, which is a correction of 30-40%.
However, Polkadot shows that it has a lot of potential for the upcoming year with one of the biggest surges so far in 2021.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Institutional Investors Continue to Buy Bitcoin as Price Tops $50K: Report
The recent price developments have not deterred institutional investors from allocating funds in bitcoin. Just the opposite, the latest major withdrawal from Coinbase to custody wallets worth $630 million became a fact earlier today, suggesting that institutions keep accumulating.
Institutions Double-Down on BTC
CryptoQuant’s CEO Ki Young Ju has repeatedly outlined the connection between bitcoin’s price and institutions using the largest US-based crypto exchange, Coinbase, to purchase more of the asset.
Past examples provided by the analytics company have indeed been followed by an increase in BTC’s value when such investors transferred sizeable quantities to custody addresses.
Ju predicted last week when BTC struggled beneath $45,000 that the asset will soon rather than later return above $48,000, which he classified as the “institutional buying level.”
His projection materialized, and the cryptocurrency has even increased above $50,000. Furthermore, Ju outlined that institutional investors have withdrawn another significant portion from Coinbase to custody wallets.
CryptoQuant’s data suggests that the withdrawal this time was about 12,400 bitcoins. From a USD perspective, this considerable about accounts for roughly $632 million with today’s prices.
It’s Not Just Coinbase Though
During last week’s market crash, when BTC lost about 25% of its value in a matter of days, reports emerged that miners have transferred substantial portions to exchanges and had cashed out some profits just before the drops.
The community feared that institutional and retail investors might follow as it could be the beginning of further sales that could harm the asset’s price even more. However, it seems that this is not the case.
Data from another monitoring company, Glassnode, shows that bitcoin holders had indeed increased the transfers to exchanges in the last week or so in February. Nevertheless, the trend has quickly reversed, and BTC investors have withdrawn some of their portions outside of trading venues.
Looking at the bigger picture, it becomes clear that investors seem determined to decrease the bitcoin holdings stored on exchanges. In the past six months alone, the percentage of BTC on trading platforms has declined from over 14.5% to 12.5%, suggesting HODLing mentality.
Someone paid $4,480 for an XRP transaction
Crypto Twitter was abuzz over the fact that someone spent about $,480 for an XRP transaction. A tweet from the Flare Community drew attention to a transaction that took place a few days ago. An unidentified user paid over 10,000 XRP worth more than $4K for a transaction on XRP Ledger. The community published the tweet in response to an XRP enthusiast who spotted a 1.04 XRP transaction fee on XRPL.
Flare network explained that fees on the #XRPL can be set programmatically, however, they were not sure why “someone would burn XRP unnecessarily.”
This was not the only XRP transaction to make news. Over the past 24 hours, significant amounts of the crypto were moved between leading exchanges and wallets.
According to crypto tracking firm Whale Alert 30,999,980 XRP, worth $13,481,945, at the time, was transferred from an unknown wallet to Coinbase. In total, 66 million XRP coins, worth $30 million, were moved.
The XRP transfers occurred between Coinbase’s wallets internally. It must be noted that on 30 December 2020, Coinbase announced that it has halted XRP trading, in the aftermath of US Securities and Exchange Commission lawsuit against Ripple. Trading XRP was expected to be fully suspended on Tuesday, January 19, 2021. However, traders can withdraw and access XRP in their Coinbase wallet even after the suspension.
Whale Alert tracked another interesting transaction, which is a part of a settlement between Ripple and its former CTO Jed McCaleb. Over 6 million XRP worth $277,683,138 was transferred from “Jed McCaleb Settlement” wallet to his TacoStand address, on 2 March.
The former Ripple chief, who has been actively selling his XRP stash, apparently has more than 2 billion XRP remaining in cold storage. According to one analyst, if McCaleb continued to sell large amounts of XRP from his wallet, he will deplete his wallet by May.
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NFTs Are Going Mainstream Fast
To say there’s too much money floating around at the moment would be the understatement of the year.
We can see it in the incredibly high valuations in the stock market overall, which is trading at about 40 times its price-earnings ratio.
Alternatively, we can drill down to specific companies like Tesla, which even after the recent dip, is still trading at more than 1,000 times the value of what those shares are actually worth.
It seems like investors are basically willing to throw money at anything that has a ticker, regardless of what that thing might actually be worth.
Don’t get me wrong, the free market is the ultimate dictator of price, but the discovery mechanism is clearly being distorted right now by global central banks who seem determined to ensure that prices keep moving up, regardless of how the economy is doing.
The latest target of this phenomena is most peculiar indeed. In fact, it is a central bank. …
Technically, there’s absolutely no reason for this sudden jump in share price, as is explained in the article, but here we are. Capitalism is now a joke. At least it’s a funny one.
I’m pretty darn sure this is the first time I’ve ever screen captured anything involving Paris Hilton, but here it is. …
It doesn’t get any more mainstream than this.
Although, it’s a bit difficult to understand Kim Dotcom’s comment about the empowerment of artists, especially in the light of Beeple, who simply doesn’t seem satisfied with his share of what the market is willing to pay for blockchain-enabled ownership of digital art.
As I write to you today, I’m listening to the three-hour stream of the confirmation hearing for Gary Gensler, who has been nominated to chair the U.S. Securities and Exchange Commission.
It’s extremely doubtful that I’ll get through the entire thing, and even though these events are usually a snooze-fest, this one has a lot of very important information about how Gensler, if confirmed, will approach the regulation of financial markets and digital assets.
Meanwhile, last night, The Chicago Board Options Exchange made its latest attempt to obtain approval for the first bitcoin exchange-traded fund to be available on a U.S. exchange.
As we know, Jay Clayton, former chair of the SEC, was vehemently opposed to such a vehicle, saying that the market simply wasn’t ready. The SEC went on to deny about half a dozen such filings.
Parsing Gensler’s statements today, it certainly seems that he’ll give it a more serious consideration than Clayton did.
If we can learn from Canada, where the world’s first bitcoin ETF was just launched to much fanfare and explosive volumes, it’s quite clear that the market is certainly ready for such a product.
Back in March of 2017, when the Winklevoss twins made the first attempt at a bitcoin-backed ETF, the market was wondering whether approving one of these funds, which would allow investors to purchase bitcoin without incurring the security issues of holding coins, or deal with the regulatory uncertainty of buying from an exchange, would be a catalyst for hedge funds to start making purchases.
Today, however, we’re not lacking any particular catalyst. Hedge funds are already buying. Bitcoin does not need any catalyst. As Gensler pointed out in his hearing, bitcoin is the catalyst.
Frankly, I’m not sure what an ETF really adds at this point. It’s only a matter of market share and who gets to rake in the fees for selling bitcoin to Wall Street. That’s not a race that most of us have any horse in, unfortunately, but it’s still fun to watch.
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