Bitcoin (BTC), the world's largest cryptocurrency, has registered a great beginning to the month of October with a 25 per cent price increase in the last one week. In the process, BTC broke the $1 trillion market cap barrier once again after dropping below the mark in May this year. The total cryptocurrency market has climbed to $2.3 trillion today (as of 5 pm IST) with a 5 per cent daily gain. In this article we analyze key trends in the cryptocurrency market this week and what is likely to happen over the next couple of weeks for key cryptocurrencies.
Bitcoinâ€™s actions result in a strong rally among top altcoins
Gains in BTC have trickled down to top altcoins (cryptocurrencies other than Bitcoin are termed as altcoins) with a majority of the top 20 registering more than 15 per cent gains in the past week.
Ethereum (ETH), the second-largest crypto, has rallied 20 per cent from the start of October. However, ETH is experiencing resistance near the $3,600 level with traders offloading some of their portfolios at this price level.
Binance Coin (BNB), reclaimed its third spot this week from Cardano and has mirrored ETHâ€™s price action to gain 20 per cent in the last 7 days. BNB continues to face resistance near the $450 region with a potential to rally up to $500 in the upcoming weeks. BNB is currently trading at $442 with a 5 per cent daily gain.
Cardano (ADA), often touted as a strong alternative to ETH, has been in an accumulation phase with price swings between $1.9 and $2.3 in the last two weeks. If the bulls are able to clear the resistance at $2.3, then ADA can rally towards $2.5 in the next couple of weeks. ADA is currently trading near $2.3, up 7 per cent today.
Tier 1 blockchains such as Solana (SOL), Terra (LUNA) and Polkadot (DOT) also have registered considerable 15 per cent plus gains this week.
Breakout story & caution
The breakout story of this week belongs to a meme coin called Shiba Inu (SHIB) which has broken into the top 20 cryptocurrency list with a meteoric 380 per cent rise in the last 7 days. However, such meme coins do not have any intrinsic value and only grow because of the network effect of a strong community and fan base. These are not viable assets to hold and grow your wealth over time.
Short-term outlook for Bitcoin
On a broader level, post a strong consolidation in the last three months, BTC has broken the $50,000 barrier once again and looks set to challenge its previous all-high-time of $64,000 by the end of October. Analysts attribute the recent price action to large BTC holders (also known as whales) trying to accumulate in anticipation of the approval of exchange-traded funds (ETF) in the US. Upward price movements in BTC will positively impact key altcoins though BTC is likely to grow faster than most of them in Q4 2021.
Disclaimer: This article was authored by Giottus Cryptocurrency Exchange as a part of a paid partnership with The News Minute. Crypto-asset or cryptocurrency investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.