Crypto: Growth without the euphoria

Market overview

The crypto market capitalisation rose to $2.3 trillion by the end of Monday, before falling back to $2.27 trillion at the time of writing. The market recovery trend continues, but the relatively cautious pace of growth suggests we are far from euphoria. This looks more like a phase of asset consolidation by major players, which means the rally will have to wait a while. Among the most active coins, the growth leaders were Stellar (+14.8%), Uniswap (+14.2%) and Aave (+7%). The underperformers were Toncoin (-5.6%), Official Trump (-3.3%) and The Graph (-3.2%).

Bitcoin is trading near $66.3K, up just under 1% over the past 24 hours, but some distance from Monday’s intraday highs, which were approximately $1K higher. The price rise is occurring within a channel that formed 10 days ago. On Monday, the price confirmed this channel by touching and pulling back from its upper boundary, but it remains at the top of the range. Provided the positive momentum continues, we see the $68K area (the 61.8% Fibonacci retracement level) as the nearest technical resistance to price growth. A more distant signal of market strength would be a firm consolidation above the 50-day moving average, which currently exceeds $73K. 

News background

CryptoQuant notes that inflows of bitcoins to crypto exchanges from long-term holders have reached their lowest level since 2015. Selling pressure is easing, and the number of bitcoins held by long-term holders has reached a new all-time high of 15.8 million BTC.

Relai expects Bitcoin’s bearish trend to end once the phase of major investment in artificial intelligence concludes. Capital may begin to flow back into the leading cryptocurrency as early as next year.

Strategy purchased an additional 1,587 BTC last week for $100 million at an average price of $63K per coin. The company now holds 846,842 BTC, purchased for $64.1 billion at an average price of $75.6K per Bitcoin.

BitMine has increased its Ethereum holdings to 5.62 million ETH, having purchased approximately 0.08 million ETH over the past week. BitMine’s reserves have reached 4.66%, with plans to acquire 5% of the Ethereum supply. 

Summary: The crypto market is rising cautiously with no signs of euphoria; Bitcoin is holding within a 10-day channel, while selling pressure is easing.