Cryptocurrency market is now in a consolidative phase following positive price action over the weekend. Bitcoin and Ethereum other major legacy cryptocurrencies got a bullish boost on Friday post which they managed to breach multiple critical price levels during the weekend. Two major factors played a great role in recent upsurge of the crypto market and they are SEC’s positive comments which hinted at possibility of approval of Bitcoin ETF’s and Litecoin’s sharp upsurge following news that Litecoin Foundation and software development firm Beam announced a partnership to explore the possibilities for implementing the Mimblewimble protocol in Litecoin network.
Litecoin Hits 4Th Rank in Terms of Market Cap
This upsurge pushed Litecoin to hit 4th rank as the largest crypto coin in terms of market capitalization while Ripple and Ethereum continued to fight for the position of the second rand in terms of market capital given sharp positive price action over the weekend. This brought in a fresh wave of fund flow erasing last week’s loss of $2 billion and adding more funds to the overall cryptocurrency market. The fresh inflow of funds worth billions of dollar is viewed as a positive sign for the crypto market and influenced further positive price action. This has created a scenario where the ongoing price run is supported by some level positive market fundamentals. A rally supported from a fundamental perspective and protected by multiple critical support price levels to the downside has resulted in consolidative action post some profit booking early in the day.
As of writing this article, BTC/USD pair is trading at $3635.5 down by 0.19% on the day and ETH/USD pair is trading at $121.43 up by 2.23% on the day. Investors now look for further headlines and events which could help the crypto market move further on the upside. However given lack of strong fundamental support to Bitcoin and legacy cryptocurrencies, this upsurge is likely to end up as another dead cat bounce sooner rather than later as investors will be quick to recover their funds and make the best of situation once traders realize the crypto market doesn’t have much to offer to move ahead in medium to long term perspective. Given the fact that aside from large scale investors and traders with a huge portfolio, the last to walk away will have least of profits and are even likely to suffer some amount of loss, investors are now waiting for the first signal of downside move so as to leave with maximum amounts of profits. The loss this time around is expected to be as spectacular as its rise.
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This article was originally posted on FX Empire
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