The cryptocurrency market is experiencing a period of calm, with the two major cryptocurrencies recovering to their levels of a month ago. But how high can they climb? BFM Crypto takes stock.
Those who follow the evolution of cryptocurrencies in real time will not have missed this information. In recent days, the queen of cryptocurrencies, bitcoin and ether, has regained their strength.
As of 5:30 p.m. today, one bitcoin is worth $22,200 according to data from Coinmarketcap. It recovered to levels of a month ago, when it was weakened in mid-June by the crypto crash after the Celsius episode. For its part, Ether is worth $1480, and is also making very good progress over a month.
Plus 28% in a week for ether
Bitcoin and ether prices rose by more than 4% and 7% respectively in the space of a day, but mostly by more than 8% and… 28% in a week for ether. How can we explain such a progression? It can be associated with the finally precise announcement of a date for the event The Merge of Ethereum which is supposed to take place on September 19th. If the event were to take place on that day (often postponed until now), it would be a real revolution in the cryptocurrency sector: see our article on The Merge.
Beyond the rise of ether, the cryptocurrency market appears to have weathered the last two crises that have shaken many companies, from the Terra blockchain to Singaporean investment fund Three Arrow Capital to the Celsius lending platform.
“The rise in cryptocurrency prices has been linked to a general lull in traditional markets and risky asset classes,” explains BFM Crypto Xavier Fenaux, partner at Interactiv Trading.
In addition, the cryptocurrency market has been correlated with traditional markets for many months, mainly through technology stocks (the Nasdaq).
“We’ve seen that traditional markets didn’t react too badly to the inflation announcement in the United States last week. (9.1% in June year-on-year, editor’s note) was quite a good surprise, rather unexpected The market is already projecting itself to 2023 and therefore the “worst” is already integrated into the prices,” adds the latter.
What scenarios for bitcoin and ether?
If cryptocurrencies are making good progress, it should not be forgotten that they have lost more than 70% of their value compared to their all-time high last November. Indeed, on November 10, a bitcoin was worth $69,000, up from just over $22,000 today.
So if the cryptocurrency market experiences a short-term rebound, one wonders if it can hold up and how far back cryptocurrencies can go. To understand the “bear” (bearish market) and “bull” market (bullish market), see our article here.
As for bitcoin, “it is not yet clear whether the low of 2022 is behind us, we are moving from a bear market to a short-term bounce. If bitcoin stays above $22,000 for several days, there will be a psychological shift in the market from fear to positive in the near term. The next level should be last summer’s low, around $28,000-30,000,” said Xavier. fenals.
However, bitcoin’s strength has waned since the last crypto crash in June. His dominance, i.e. his dominance in the global cryptocurrency market (estimated at over 1,000 billion in capitalization), has thus gone from 48% to 42% in a month.
“This means that investors are now much more interested in anything that is not bitcoin, and so we can see a nice progression of certain altcoins (a term that refers to cryptocurrencies other than bitcoin, Ed),” underlines Xavier Fenaux.
These Other Rising Cryptos
This progression can be observed on the ether side on the one hand. The cryptocurrency rose much faster than bitcoin and broke above its resistance that had built up for a month towards $1300.
“As long as we stay above $1,300, we’ll see a near-term bullish reversal. There could be a medium-term technical resistance level around $1,800-$2,000 that will likely lead to some interruptions, if we go that far.” the expert.
But other cryptocurrencies made good progress in the span of a month and started pleasing traders. For example, this is the case for the Matic cryptocurrency (from the Polygon blockchain) which went from 30 cents on June 18 to nearly $1 today or even qnt (Quant), which was $45 on June 18, over $100 today .