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Juan Villaverde has been an economist and mathematician since 2012 and deals with the analysis of cryptocurrencies. He leads the Weiss Ratings team of analysts and computer programmers who have created Weiss cryptocurrency ratings.
Dr. Bruce Ng is an educator in the field of Distributed Ledger Technology (DLT) and has been a leading crypto-tech analyst for Weiss Cryptocurrency Ratings since shortly after its introduction.
After a searing price spike that ended at an all-time high of around $ 41,000, Bitcoin (BTC) retested its 21-day moving average last week.
In other words, from here, Bitcoin seems to be deciding whether to continue its uptrend or continue to move into a correction – perhaps a longer, more refreshing pause.
During the 2017 bull run, we saw BTC correctly on the order of 40% several times. That would, in fact, be a frighteningly drastic price move in other old school financial markets. But – and you have to be prepared for this – this is completely normal behavior for cryptocurrencies.
We hope you’re not doing a big deal in this week’s fix – it’s perfectly normal – just what you should be doing … https://t.co/hb6gtQWdai
– Weiss Crypto Ratings (@WeissCrypto)
In the meantime, altcoins have been making moves while bitcoin is stalling.
Polkadot (DOT) and Chainlink (LINK) have led a group of altcoins to new all-time highs this week. That is also normal.
We typically see a trend of large altcoin price moves after the bitcoin price rises. Bitcoin and, on a smaller scale, Ethereum (ETH) tend to lead the market on the way up during the bull runs.
As soon as Bitcoin trades sideways or investors take profits, some of this money flows into altcoins. And of course that drives up the prices of these alternative investments.
By the way, the ETH rose by 60% in the first 14 days of the year. I think it surpasses all year, but I still own a lot … https://t.co/AQyWRIE9pn
– Raoul Pal (@RaoulGMI)
As Raoul Pal notes, investors are looking for potentially higher returns on riskier assets after the Bitcoin and Ethereum price hikes. Often times, these altcoins can achieve much higher returns than Bitcoin due to their smaller market capitalization.
We could see the first signs of a new phase in the market showing up in new highs for these altcoins.
One of the altcoin segments that may get even more investor attention – and thus even more oversized returns – is Decentral Finance, or DeFi, the 2020 darling of the crypto industry.
After DeFi Summer 2020, more people are now aware of these coins, and they could turn their attention this way once this altcoin season starts. We are closely watching what we consider DeFi blue chips.
DEXs are on track to hit a record $ 55 billion this month. Https://t.co/SFO1i9PoM5
Altcoin seasons are some of the most fun times in the cryptocurrency markets. Whether we have entered this phase of the market cycle remains to be determined.
What is certain is that we are facing exciting times.
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