News
08
Feb
crypto-market-review-5

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Market Overview 2/8: Cryptocurrencies in a strong uptrend

Bitcoin is pulling the markets up to new heights! Many popular coins are up tens of percentages from the January lows. The meme coin Shiba Inu and Ripple’s XRP have woken up while the TVL is growing in the DeFi sector again.

Bitcoin’s price is rising fast

Bitcoin’s price is $43,800 at the time of writing this article. It was $38,500 a week ago and just $36,300 two weeks earlier. We are witnessing a strong uptrend right now. Bitcoin’s daily candle has last time closed higher on January 4th.

The graph below shows Bitcoin’s price development in the past six months. The blue line is the 50-day moving average and the purple line is the 200-day moving average. The red dotted line describes a strong resistance level which has its starting point in the November 2021 all-time highs.

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The last time Bitcoin looked this strong was in October 2021. The price has broken several important resistance levels in the past weeks.

The red dotted showing in the picture above was potentially a major hurdle, but Bitcoin blasted through at the end of last week and printed a $4259 daily candle after that. We haven’t seen such daily moves since November 2021 when Bitcoin made a new all-time high.

Bitcoin’s price has also climbed above the important 50-day moving average. The price hasn’t been above this trend line since mid-November. We have also broken other resistance levels. It was even a bit surprising how easily Bitcoin went through the $40,000-$42,000 area.

Have we really seen a trend reversal or is this just a bull trap for too eager investors? Analysts have started to look more and more at the Heikin Ashi candles in 2022 with Bitcoin. To be more precise, we are talking about weekly candles here.

This is what such a graph looks like for Bitcoin.

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Many analysts feel that Heikin Ashi candles are great for spotting trends since they eliminate some of the noise the volatile market creates. These candles keep the color unchanged for much longer. If you want to know how Heikin Ashi candles are calculated check this article.

As you can see from the picture above, Heikin Ashi weekly candles have turned green. This would signal a trend reversal.

Even if Bitcoin’s price development looks promising, one must be very careful in the short term. Fed’s planned rate hikes take place in about five weeks. Then we have the geopolitical risk of Ukraine and the weakening macro data from the United States. It might be that Bitcoin revisits the $30,000 area in 1-2 months.

Bitcoin’s dominance is unchanged

Bitcoin’s dominance is 42.33% at the time of writing this article. It was 42.16% a week ago, which means there haven’t been any major changes. When we zoom out, we can see that the dominance is in a small uptrend which started in mid-January. Back then, Bitcoin’s market share dropped all the way to 39.1%.

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Even if the dominance hasn’t moved up in the past week, it shows strength. Altcoins tend to rally much harder than Bitcoin when a trend reverses. Now Bitcoin has beaten most of the top 15 currencies. Though, it’s difficult to see Bitcoin reaching the market share it had a year ago (over 60%) in the current environment.

The meme coin Shiba Inu is rallying

Let’s look at the altcoin market next. Even if Bitcoin’s dominance has remained relatively unchanged, major altcoins are mostly in the red. The trend is obvious: coins with big market caps have lost value against Bitcoin while smaller coins have gained.

The list below shows the top 15 ranked cryptocurrencies and the price-performance vs Bitcoin.

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Ripple’s XRP has performed well first time in ages. This is because there has been positive news regarding Ripple’s legal battle against the SEC. This case has been ongoing for over a year now. Do we finally see a resolution in the first quarter of 2022?

The best performer of the top 15 coins is Shiba Inu. It has been boosted by the new partnership with Welly’s. Most investors also see SHIB as a meme coin they want to speculate with due to a trend reversal.

Shiba Inu has gained over 50 percent in one week when measured in USD.

When we go down in the rankings, we’ll find an even stronger performer: Gala Games. This is a platform specialized in play-to-earn games which could be compared to the popular Steam app. GALA is the utility token used in the Gala Games ecosystem.

Gala Games was boosted by the recent NFT launch related to its Spider Tanks game. Those NFTs are purchased by using the GALA token.

In general, the altcoin market looks very positive. Almost every top 100 currency is green in dollar terms for the past seven days. Most are up more than ten percent.

DeFi sector is showing green colors

The DeFi sector was asleep a week ago even if the rest of the market was already trending higher. This time it’s different. The TVL of the DeFi market has increased about 15 percent.

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The TVL was 194 billion dollars a week ago. Now we sit 26 billion dollars higher. This number is going up mostly because the value of the collateral (non-stablecoin cryptos) has increased in dollar terms. It’s interesting to see if this is a sustainable uptrend or not.

The protocol ranking list is relatively unchanged. Curve is still holding the top spot with a safe margin. The TVL growth is also split quite evenly between different apps.

defiprot-080222

There are some minor changes at the end of the list, though. Anchor and Multichain have swapped places (7th and 8th) in rankings. Instadapp has been kicked out of the top 10 as well. It’s been replaced by Compound.

The blockchain race isn’t that hot either. All top chains have increased TVL except for Fantom.

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Fantom’s downtrend has seen it fall below Avalanche to 5th place.

Avalanche looks great at the moment when compared to other top platforms. Ethereum, Cardano, and Solana have all had their technical challenges. Terra Luna had also some unexpected drama a week ago. Avalanche seems to be the one running without any issues.

There is also a new blockchain on the list: Osmosis.

osmosis

This is yet another blockchain built with Cosmos SDK. The liquidity is entirely on one app, Osmosis DEX. It has become famous for superfluid staking which makes it possible to stake the OSMO token while it’s being used to provide liquidity.

You should follow the OSMO token closely since it’s only at 205th place in the crypto rankings. If Osmosis is going to get tracking its OSMO token has a lot of upside.

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