Altcoin ascension: MAGIC, Optimism and Stargate Finance rally 20% after Powell's comments


Share:
  • MAGIC, Optimism and Stargate Finance have rallied beyond 20% after the US Federal Reserve’s policy meeting on Wednesday.
  • While MAGIC and Optimism are entering price discovery phases, STG has a long way to go.
  • The rallies, while impressive for all three altcoins, are facing crucial hurdles and could trigger a correction.

Optimism (OP), MAGIC (MAGIC) and Stargate Finance (STG) are the top gainers in the last 24 hours. The rally in these altcoins can be attributed to the volatility generated by the US Federal Reserve's interest rate decision at their policy meeting on Wednesday. 

Although the Fed's official statement was interpreted as hawkish as it stated interest rates would need to remain high, comments from the US fed Chairman Jerome Powell in the press confernece afterwards triggered a U-turn in market perceptions after he suggested rate hikes were having a subduing effect on inflation. "For the first time, we can declare that a deflationary process has begun," said Powell, which immediately turned sentiment negative for the US Dollar and triggered a rally in risk-on assets like Bitcoin and stocks.

Also read: Fed remains hawkish with 25 bps hike, how will Bitcoin price react?

Can altcoins keep their gains?

MAGIC has the highest gains of 37% among the three altcoins. Stargate Finance comes in second at 34% and Optimism at 28%. While the returns on these altcoins are impressive, investors need to be cautious as Bitcoin, the largest cryptocurrency by market capitalization is showing cracks in its armor.

Let’s take a look at MAGIC altcoin and what to expect from its price action.

MAGIC price hit an all-time high of $1.787 as of February 2, and the 29% daily candlestick that precedes it is an impressive move. Given the short-term bullish trend long bets are favoured. Using the trend-based Fibonacci extension tool, investors can note that the next target and potential hurdle is at around $1.900, which is the 100% Fibonacci extension level.

Depending on the daily candlestick close on February 2, investors can decide if they want to hop on a long position or turn short. 

MAGIC/USDT 1-day 

MAGIC/USDT 1-day 

If the current candlestick develops into a doji, the likelihood of a reversal becomes higher. If a pullback gathers steam MAGIC could retrace to the 50% Fibonacci retracement level at $1.570.

Stargate Finance price hit a peak of 34% after the FOMC meeting. In doing so, STG tagged the state trend resistance level at $0.800. If there is a massive rejection, causing a small body for a daily candlestick or if it flips into a down candlestick, it is indicative of profit-taking. In such a case, Stargate Finance could witness a 15% drawdown, pushing it down to $0.658. 

STG/USDT 1-day chart

STG/USDT 1-day chart

On the other hand, if $0.800 is flipped into a support floor, the next hurdle for STG is 14% away at $0.914.

Optimism price has hit an all-time high of $2.81, but the daily candlestick has already flipped red, denoting a spike in selling pressure. Continued profit-taking will result in an 11% downswing to $2.38, which is the 50% Fibonacci retracement level.

OP/USDT 1-day chart

OP/USDT 1-day chart

A sustained buying pressure that flips the $2.81 hurdle into a support floor could see OP price tag the 127.2% Fibonacci extension level at $3.10, marking another all-time high.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Ripple holders' profit taking hits a 19-month high as XRP price shoots up by 42%

Ripple holders' profit taking hits a 19-month high as XRP price shoots up by 42%

XRP price has performed beyond expectations and has marked a multi-month high, restoring confidence in its investors. These holders have also made the most of the situation and turned to sell, which could backfire on the price action soon.

More Ripple news

Decentraland Price Forecast: What to expect from MANA as Metaverse Fashion Week kicks off

Decentraland Price Forecast: What to expect from MANA as Metaverse Fashion Week kicks off

Decentraland price (MANA) has identified critical support on day one of the Metaverse Fashion Week. The token is trading horizontally on the four-hour timeframe as bulls push to break above a descending trendline.

More Decentraland News

Ethereum devs confirm withdrawals to begin on April 12; Here's what to expect from ETH price

Ethereum devs confirm withdrawals to begin on April 12; Here's what to expect from ETH price

Ethereum is on the verge of bringing about one of the biggest upgrades to the blockchain since the Merge. The arrival of withdrawals has been anticipated for a long time now, however, it may not be as lucrative for Ethereum price as one might expect.

More Ethereum News

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Market woes threaten bullish potential, XRP is undeterred

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Market woes threaten bullish potential, XRP is undeterred

Bitcoin has reclaimed above $27,000, but increasing market volatility threatens the leg up. Ethereum faces critical resistance at $1,819 as investor sentiment suggests liquidity issues. Ripple reaches multi-month highs amid lawsuit-related optimism.

More Bitcoin News

Bitcoin: Should you trust this BTC sell signal or wait for $34,000?

Bitcoin: Should you trust this BTC sell signal or wait for $34,000?

Bitcoin price shows a clear picture of its rally after it breached a long-term bullish pattern in mid-January. As the rally takes a breather, sell signs have started to emerge, which is putting investors in a confused state. 

Read full analysis

BTC

ETH

XRP