Traders flock into altcoins as Bitcoin price trades sideways

The bullish momentum seen all through the week has spilled over into the weekend as the vast majority of the top-100 tokens listed on CoinMarketCap are posting double-digit positive factors. 

Bitcoin (BTC) coming into a short consolidation interval and the opportunity of a third round of stimulus checks for Americans are two potential causes for at this time’s bullish worth motion.

Each day cryptocurrency market efficiency. Supply: Coin360

Whereas there are considerations in regards to the current large Bitcoin inflows into South Korean exchanges by BTC whales, fundamentals components like miner sentiment and lowering provide are preserving buyers feeling comparatively optimistic about Bitcoin’s future worth prospects.

A rising variety of specialists have voiced their opinion that Bitcoin’s current bullish surge is because of outflow from gold as the highest cryptocurrency is shortly changing into the popular inflation hedge for the millennial generation.

Bitcoin finds a brand new vary in uncharted territory

Following the brand new all-time excessive worth in Bitcoin (BTC) of $41,940 on Jan 8, the highest cryptocurrency has entered what appears to be a short consolidation section as bulls try to push the worth greater after confirming the $40,000 degree as help.

BTC/USDT 4-hour chart. Supply:

On the time of writing, BTC is up 1.53% on the day and buying and selling at $40,690 because the 24-hour buying and selling quantity has seen a 26% lower from the file excessive’s set on Jan 8.

Predicting what comes subsequent is a tough activity at these worth ranges because of the absence of a worth ceiling. With regard to cost volatility, Chad Steinglass, the top of buying and selling at CrossTower advised that elevated volatility could possibly be the norm till the market strikes “right into a extra secure setting of balanced flows and extra secure costs.”

In non-public feedback to Cointelegraph, Steinglass stated:

“I believe we’re coming into a stage within the markets the place $1,000 intraday swings are just about going to be regular… Market maker liquidity relative to large participant measurement is getting smaller and smaller. With market makers having lowered capability to warehouse threat relative to buying and selling movement, I anticipate costs to maneuver fairly shortly.”

Has a brand new altcoin season began?

As has been the case in earlier bull markets, an increase within the worth of Bitcoin is commonly adopted by a consolidation section. Throughout this time, merchants are likely to shift their consideration towards altcoins and Bitcoin income shift into smaller cap cryptocurrencies.

Based on Jean Baptiste Pavageau, a accomplice at ExoAlpha, the present bullish momentum seen from Bitcoin will finally decelerate and at this juncture buyers are more likely to pile into altcoins. Pavaageau informed Cointelegraph:

“Certainly, now we have began to watch a basic “wealth” distribution sample over the previous 2 weeks, the place Bitcoin buyers wish to take their revenue and spend money on different blue-chip cash. Whereas the upside on Bitcoin is lowering, the altcoin market is changing into extra interesting for merchants and buyers who’re searching for massive returns. We anticipate to see Bitcoin dominance beginning to lower and the altcoin market booming over the following few weeks.”

BTC/USD every day chart. Supply: Coin360

Ether (ETH) worth continues to surge to new yearly highs as the worth rallied 4.2% to $1,267. In the meantime, Bitcoin Money (BCH) and Bitcoin SV (BSV) are up 23.6% and 61% respectively.

Coming off per week stuffed with positive developments for stablecoin projects, MakerDAO and its MKR token, which govern the event of the DAI stablecoin, has seen a rise of 45% over the previous 24-hours and at present trades for $1,530.

The general cryptocurrency market cap now stands at $1.1 trillion and Bitcoin’s dominance fee is 69%.