Crypto intelligence firm Santiment says that significant price spikes could be coming for seven different altcoins based on under-the-radar data.
Santiment says that an excessive number of short-sellers are piling into altcoins, raising the probability of an incoming short squeeze.
A short squeeze occurs when a large number of traders try to short an asset, and then get hit by an unexpected price bump which triggers a cascade in liquidations and a price rise thereafter.
The analytics firm says that excessive shorts, plus negative funding rates on exchanges are threatening the bears when it comes to Binance Coin (BNB), Axie Infinity (AXS), Monero (XMR), NEM (XEM), Ankr, SiaCoin (SC) and DigiByte (DGB).
“We’re seeing a notable rise in leveraged short positions across different #crypto assets currently. Average exchange funding rates are negative for altcoins such as ANKR, XEM, SIA, XMR, AXS, DGB, & BNB. If these shorts are liquidated, it can lead to major price spikes.”
Source: Santiment/Twitter
Looking at Bitcoin, Santiment sees some bullish on-chain metrics looming behind the scenes for the largest crypto asset by market cap. According to the firm’s data, BTC is flying out of exchanges at a rate not seen since 2018, which could suggest that another major liquidation event is less likely than price action would suggest.
“In the midst of Bitcoin’s 10-week price retrace, its ratio of supply on exchanges has dropped to its lowest level since November 2018. Traders moving BTC to cold wallets continues, and this milestone points to less risk of a continued major selloff.”
Source: Santiment/Twitter
Santiment also points out that Bitcoin whales, or entities with 1,000 to 10,000 BTC, have accumulated over 40,000 coins in the last two days, equivalent to roughly $1,689,160,000.
“Bitcoin has rebounded, and is +$1,000 in price the past 5 hours. Now sitting at $42.4k, this comes after whales have accumulated 40k more BTC in the past 2 days alone. They now are back to owning the same amount from before their dump began at $49k.”
Source: Santiment/Twitter
At time of writing, BTC is trading at $42,229.
Check Price Action
Don’t Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
This week CNBC reported that Morgan Stanley will give its millionaire clients access to Bitcoin (BTC) starting in April and this shows that traditional financial powerhouses are under pressure from their clients who are demanding exposure to cryptocurrencies. This suggests that the rate of institutional adoption may still be at a nascent stage.
Crypto market data daily view. Source:Coin360
Chinese tech company Meitu also announced a new purchase of $21.6 million worth of Bitcoin and $28.4 million worth of Ether (ETH) on March 17. The company said its board believes “cryptocurrencies have ample room for appreciation in value” because the blockchain industry is still in its early stages and can disrupt existing technology and financial sectors.
Other than the major cryptocurrencies, there are several lesser-known tokens that show potential. While many will fall to the wayside, some of these could become winners of tomorrow.
Let’s look at the fundamentals and technicals of three upcoming tokens.
LINA/USDT
Linear’s LINA token zoomed higher today following its listing on the Binance Innovation Zone.
Built on the Binance Smart Chain, Linear protocol is a cross-chain compatible decentralized synthetic asset protocol, claiming to offer traders faster transactions at much lesser fees than its competitors on the Ethereum network.
Due to its cross-chain compatible nature, users can access both the BSC and ETH decentralized finance ecosystems and Linear has also partnered with Moonbeam for future Polkadot integration.
On March 10, Linear launched synthetic versions of the Xangle Large Cap Index and the Xangle Blue Chip Index. During an AMA session, Linear CEO and co-founder Kevin Tai said the protocol plans to launch innovative products that are different than what is available with other synthetic asset protocols.
After the initial listing euphoria dies down, the user experience and the product line could decide the future course of the token.
LINA skyrocketed from an intraday low at $0.073 on March 9 to an intraday high at $0.348 today, a 376% rally within ten days. However, the long wick on today’s candlestick suggests traders aggressively booked profits at higher levels.
LINA/USDT daily chart. Source:TradingView
The LINA/USD pair is likely to find support near the 50% Fibonacci retracement level at $0.198. If that happens, the pair may digest the gains by trading in a range, before attempting to start the next trending move.
Any rebound off $0.198 is likely to face stiff resistance at $0.24 and again at $0.28 as traders stuck at higher levels may rush to the exit.
On the downside, a break below $0.198 could open the doors for a fall to the 61.8% Fibonacci retracement level at $0.162. Such a deep fall will suggest that traders have dumped their positions and that could delay the start of the next leg of the up-move.
BAT/USD
Basic Attention Token (BAT) was featured on Cointelegraph on March 4 when its price was at $0.675. Since then, the token jumped to $1.369 on March 17. That’s a 102% rally within a fortnight. This shows that traders should nurture and hold on to the tokens that have strong fundamentals backing them.
Gaining support from the right investors can many times make a lot of difference to a project. Therefore, when Grayscale CEO Michael Sonnenshein announced on March 17 that BAT was one of the five tokens added to the Grayscale lineup, it was bound to stir interest among the community. This increases the possibility of greater institutional interest in the token.
In addition to this, Japan’s bitbank exchange announced it will add support to BAT from March 17. This step increases the reach and demand for BAT among crypto-savvy Japanese investors.
Fresh investors enter a project only if they see a possibility of further earnings. The Brave transparency page recently showed that about 100 active advertisement campaigns from the U.S. were running on the Brave browser.
A whitepaper “Engaging with Ad Choosers,” by Dentsu international and Brave shows that ads on the Brave browser outperform the traditional digital campaigns on key branding metrics. As the number of users increase, advertisers are bound to take note.
With Google embroiled in a lawsuit for collecting data even in Incognito mode, users interested in protecting their privacy could look for alternatives and that may lead them to Brave browser.
BAT has been in a strong uptrend for the past few weeks. Both moving averages are sloping up and the relative strength index (RSI) is in the overbought territory, which suggests the bulls are in control.
BAT/USDT daily chart. Source:TradingView
The token picked up momentum on March 16 when it rose above the overhead resistance at $0.89. However, the long wick on the March 17 candlestick and the Doji candlestick pattern today suggest the bulls may be tiring out.
The first support on the downside is the 38.2% Fibonacci retracement level at $1. This is also a psychologically critical support. If the price rebounds off this level, the bulls will attempt to resume the uptrend. A break above $1.38 could clear the path for a rally to $2.
On the contrary, if the bears sink the price below $1, the BAT/USD pair could drop to the 20-day exponential moving average ($0.81). A bounce off this level will suggest the uptrend remains intact, but a break below it could intensify the selling and sink the price to the 50-day simple moving average ($0.58).
SC/USD
Siacoin (SC) was showcased on Cointelegraph on Feb. 4 when SC was trading at $0.0085. The token continued its bullish trend after that and has hit $0.022 today, a 158% rally in about a month and a half. Let’s update its fundamentals and technicals to help traders make informed decisions.
Skynet Labs and Streambed entered into a partnership on Feb. 11 with an aim to give the control of the content back to the creators. The content uploaded through Streambed will be stored on a decentralized platform Skynet built on top of Sia. This ensures that the content cannot be de-platformed and hacked as it is stored world over secured by the blockchain.
Additionally, what generated greater interest and speculation was that Sia tweeted on March 15 about TikTok creators and their earnings and then teased to watch out for big announcements this week. While rumors tend to boost prices, traders should be careful because if the announcement is not up to the mark, speculators may dump their holdings.
SC is in a strong uptrend as it continues to march higher without showing any signs of exhaustion. This suggests strong demand at every higher level. However, the rally of the past few days has pushed the RSI above 82, indicating the token is overbought in the short term.
SC/USDT daily chart. Source:TradingView
However, during strong uptrends, the crypto markets sometimes remain overbought for an extended duration. Hence, this should not be the sole reason for taking any action.
The SC/USD pair could face resistance at 138.20% Fibonacci extension level at $0.023 and then at 161.8% extension level at $0.025.
If the price turns down from the overhead resistance, it is likely to enter a period of minor correction or consolidation. A shallow pullback will suggest that traders are not closing their positions in a hurry, which could keep the gates open for a further rally.
Alternatively, a deeper correction will suggest that traders are dumping their positions in a hurry. If that happens, the pair could enter a consolidation, delaying the start of the next trending move.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.
The total market capitalization of cryptocurrencies surged to $1.139 trillion on Feb. 4, just short of silver’s total market cap at $1.5 trillion.
While the crypto market cap is still way below that of gold, Bloomberg senior commodity strategist Mike McGlone said in a report that Bitcoin (BTC) has found strong support at $30,000 and it may now rally to $50,000 and higher.
Crypto market data daily view. Source:Coin360
However, some institutional investors who had invested at lower levels and are sitting on huge profits are taking some money off the table.
United Kingdom-based Ruffer Investment Management said it had initially invested about $600 million in November 2020, which had more than doubled when Bitcoin hit an all-time high at $41,959.63. The firm booked profits on an amount just more than their cost and decided to let the remaining balance ride.
While Bitcoin gradually climbs towards the all-time high, altcoins have been soaring, suggesting that traders have shifted their funds from BTC into Ether and other smaller-cap coins.
Let’s analyze three such tokens that are backed by strong fundamentals.
UMA/USD
Professional traders use volatility data to make informed decisions and be on the right side of trade. Therefore, the CBOE Volatility Index, known as the VIX, is popular with traders.
Bitcoin is known for its high volatility and Universal Market Access (UMA) plans to offer traders an opportunity to trade volatility in a decentralized way. For that, the protocol plans to launch a uVol-BTC product that will be settled at the end of the month. Traders could use the token to speculate on the increase or decrease in volatility, or hedge their Bitcoin positions they do not want to sell during sharp corrections. If the product turns out to be successful, a uVOL-ETH token is also planned in the future.
Other than the regular synthetic tokens that track the price of an asset, traders keep looking for new opportunities that do not give institutions a direct edge. In order to cater to this demand, UMA plans to launch a new synthetic token called ‘uSTONKS’ that will be based on the ten most commented stocks on the r/wallstreetbets Reddit forum. The new uSTONKS token offers retail traders a unique way to benefit from the movement of the most popularly discussed stocks on the forum.
Early discussions are also in progress to create a “Big Mac Synth” based on the index invented by The Economist back in 1986. Launching innovative tokens attracts new traders. Another reason that could have added to the short-term demand for UMA was the negative 15.5% annualized yield for depositing Ether as collateral to borrow USDC.
UMA has soared from an intraday low at $11.234 on Feb.2 to an intraday high at $43.998 today, a 291% gain within three days. This sharp rally has pushed the relative strength index (RSI) deep into the overbought territory.
UMA/USDT daily chart. Source:TradingView
The long wick on today’s candlestick shows that traders are booking profits after the recent run-up. The first support on the downside is the 38.2% Fibonacci retracement level at $31.482.
If the UMA/USD pair rebounds off this support, it will suggest that traders are buying on a shallow correction and not waiting for a deeper fall. The bulls will then try to resume the up-move by pushing the price above $43.998. If they succeed, the pair could rally to $62.
Contrary to this assumption, if the bears sink and sustain the price below $31.482, the correction could deepen to the 61.8% retracement level at $23.75. Such a move will suggest that the bullish momentum has weakened.
CHSB/USD
Crypto projects that carry out buybacks increase value for their long-term investors. SwissBorg (CHSB) also does buybacks with 20% of threvenues made from fees, but unlike the usually followed method of a publicly shared scheduled buyback, the protocol buys only when the price is bearish and has dropped below the 20-day EMA. This ensures that the HODLers who do not sell their positions during the downturn benefit from the buybacks.
However, in the age of decentralized finance, buyback alone is unlikely to attract investors. Therefore, the protocol started rewarding CHSB token holders from Jan. 28 of this year. The premium users, who have staked 50,000 CHSB for a 12-month period, earn double the rewards on their crypto tokens, barring the quantity staked to go premium.
The protocol plans to launch a robo advisor in the future that will work similar to the rating agencies in traditional finance. The robo advisor will provide users with all the necessary information that can help investors decide on the project and the yield depending on their risk profile.
CHSB has been in a strong uptrend for the past few days. It rallied from an intraday low at $0.289898 on Jan. 26 to an intraday high at $1.008969 today, which is a 248% rally in a short time.
CHSB/USD daily chart. Source:TradingView
However, the recent rally has pushed the RSI deep into the overbought territory, which suggests the rally is vulnerable to a minor correction or consolidation.
The long wick on today’s candlestick suggests traders are booking profits near the psychological resistance at $1. The first support on the downside is the 38.2% Fibonacci retracement level at $0.734282.
If the bulls defend this support, the CHSB/USD pair will attempt to resume the uptrend. A break above $1.008969 could start the next leg of the up-move that could reach $1.15 and then $1.40.
On the other hand, if the bears sink the price below $0.734284, the decline could extend to the 20-day exponential moving average ($0.52). Such a fall will point to a possible range-bound action for a few days.
SC/USD
Several large corporations like Microsoft, Google, and Amazon are spending large amounts of money on their cloud storage systems.
However, using a centralized cloud storage service means the data is at the mercy of the corporation and several security breaches in the past are an example of how the data can be compromised. These disadvantages are alleviated in a decentralized cloud storage service such as Siacoin (SC) where the owners have complete control over their data.
Sia recently completed a hardfork to incorporate a new Sia foundation that will handle the ongoing developments of the Sia ecosystem. This will gradually free the Sia foundation from Skynet labs, which currently handles the operations of the protocol.
Rumors are that Coinbase may add support to Sia. If that happens, the coin could extend its up-move further.
SC surged from $0.004108 on Jan. 28 to $0.009950 on Jan. 29, a 142% rally within two days. After this sharp up-move, the token witnessed a correction that found support near the 61.8% Fibonacci retracement at $0.006340.
SC/USDT daily chart. Source:TradingView
The bulls are currently attempting to resume the uptrend but the bears have other plans. The SC/USD pair turned down from $0.009709 on Feb. 3, indicating that the bears are defending the overhead resistance aggressively.
If the bulls do not allow the price to dip below $0.007718, the pair could again try to break out of the overhead resistance. If they succeed, the pair could rise to $0.0120 and then $0.0150.
On the other hand, if the price slips below $0.007718, the pair could drop to the 20-day EMA ($0.006). A strong rebound off this support will point to a few more days of range-bound action. A break below the 20-day EMA could signal advantage to the bears.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.
