Crypto market is recovering with Ethereum as the protagonist

Alejandro Zala, Country Manager of Bitpanda Spain, shared with Cointelegraph en Español a new analysis of the cryptocurrency market based on this week’s events.

Alejandro Zala said both traditional financial and digital asset markets saw a significant sell-off following last Friday’s news that a variant of COVID, despite a decline that has already been on a rebound with Ethereum as the protagonist, as the title suggests -19, called Ómicron, appeared in South Africa and some parts of Europe.

Important sale given a new variant of COVID

With the potential risk of the new variant of COVID, the Omicrón, Zala pointed out that the correlation of the markets was being seen again and that cryptocurrencies were also affected by this fact. In the case of Bitcoin, it lost nearly 10% in a single day, while some altcoins fell even further. “The Omicron variant affects global markets with increasing risk and puts pressure on some of the world’s most popular stock indices. However, the market rebounded over the weekend, with Ethereum being the star of the show as investors increasingly turned to the second largest cryptocurrency by market cap. said Zala.

Ethereum is in bullish mode and trading at its all-time high

Crypto market is recovering with Ethereum as the protagonist
Crypto market is recovering with Ethereum as the protagonist

Although much of the cryptocurrency market is moving down the intraday charts for fear of the new variant of COVID, some cryptocurrencies and tokens are reacting very differently and the structure of the upper timeframe remains bullish.

“The price of ETH has risen by more than 20% from its low last Friday (EUR 3,500) and is trading near its all-time high. The ETH / BTC pair also recently broke out of a nearly 7 month consolidation range and has moved high in volume above 0.08 BTC, suggesting the bulls have some momentum left for another run. This breakout is important as it represents a level of resistance trailing back to the 2017 high when one ETH was 0.15 BTC. The month-end close of the ETH / BTC chart was the largest bullish closing price in 45 months. commented Zala.

At the same time, one could say that the volume increased as the price increased, which is a bullish signal and a sign of strength: “Ethereum far outperforms Bitcoin this year. Bitcoin’s growth since January has been around 90%, while ETH has increased 540% in the past 11 months. Ethereum has also increased its market dominance to 22%, while it was still below 10% at the beginning of the year. The number of active addresses on the network continues to rise, while ETH’s net issuance continues to decline, which could be the main reason for its soaring rise. Zala added.

Bitcoin fell on the worsening macroeconomic outlook

According to Zala, due to the fact that Bitcoin closed the monthly candle down in November, it could take traders a few days to digest the latest moves. “The fear and greed index for cryptocurrencies is 33, which suggests that market participants are skeptical of another rally by BTC. On the flip side, a bullish month has taken the altcoin market to new heights for ETH. BTC bounced back from Friday’s decline but is still struggling to break out of the falling wedge pattern on the daily chart, which also suggests it is preparing for another attempt to break out of the $ 51,000 resistance zone, the Has previously declined an outbreak on two occasions. The Relative Strength Index (RSI), an indicator of momentum, is also on the rise, but it is still hovering below the 50 mark, which is often viewed as the threshold for an upward / downward trend. You have to pass this line to complete the correction, “he pointed out.

MicroStrategy is the largest corporate owner of Bitcoin

An important fact that Zala also highlights in its report is the fact that the NASDAQ-listed business intelligence company MicroStrategy added a total of 7,002 Bitcoins to its cash register for around 365 million euros in the fourth fiscal quarter. “With this move, MicroStrategy has a total of 121,044 coins valued at more than 6,000 million euros, making it the largest company to own Bitcoin.” commented.

The ADA price has fallen, but the Cardano user base is growing rapidly

Eventually ADA hit 1.25 euros, its lowest price since August, but the bulls pushed the price back into the downward channel, Zala said, adding a tidbit: the fact that Cardano is seeing a significant surge in users and transactions despite the price drop after the introduction of the Alonzo update in September this year. And he recalled that IOHK, the company behind Cardano, stated that the number of transactions has multiplied by more than twenty in one year, from less than 10,000 per day in November 2020 to more than 200,000 daily transactions today.

“In order to cope with the considerable growth in data traffic, the company is increasing the size of the Cardano blocks by 12.5% ​​from 8 kilobytes to 72 kilobytes. A larger block size means more transactions can fit in a block, which gives users more capacity, ”said Alejandro Zala.

(Clarification: This material is intended as a commentary on economic or market conditions and does not constitute a financial analysis or a recommendation. The analysis presented here is in accordance with the country manager of Bitpanda in Spain and is under no circumstances an investment recommendation by Cointelegraph. Everyone should consider investing before do their own research and are responsible for their own decisions).

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