Ethereum's ether token is up 80 percent on a YTD basis
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Ethereum's ether token has had a great 2020 so far. Though down nearly 20 percent from recent highs, the second-largest cryptocurrency by market value is still up a solid 80 percent on a year-to-date basis.
The rally could be associated with three factors: the upcoming bitcoin reward halving and the resulting rise in bitcoin, the anticipated release of ETH 2.0 and the breakout of the decentralized finance (DeFi) industry.
Bitcoin bottomed out near $6,430 in mid-December and rose to $10,500 earlier this month. At press time, the cryptocurrency is reporting a 23 percent gain on a year-to-date basis.The top cryptocurrency has put on a good show this year, helping ether and the broader market shine, possibly on bullish expectations surrounding the 50 percent emission cut, scheduled to happen in May.
Ether seems to have benefited from the clarity on ETH 2.0 – a major network upgrade that will shift the blockchain’s current proof-of-work consensus algorithm to proof-of-stake and transfer validation function from miners to special network validators. Investor confidence had dropped in the second half of 2019 due to ethereum’s persistent scalability issues.
Last but not least, the demand for ether seems to be rising with the growth of the decentralized finance (DeFi) space. The total value locked (TVL) in DeFi protocols rising from $320 million to $670 million. The TVL rose further to a record high of $1.219 billion on Feb. 15, according to DefiPulse. |
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Corrective Bounce
BTC: Price: $8,870 | Market cap: $161 billion | 24-Hr Volume: $51 billion
Trend: Bearish Bitcoin has bounced up by $300 from the one-month low of $8,520 reached during the Asian trading hours and could rise further, as short duration charts are reporting a weakening of bearish momentum.
Notably, the 4-hour chart relative strength index is reporting oversold conditions with a below-30 print. Further, the 4-hour chart shows a bullish hammer reversal pattern.
So, the cryptocurrency could challenge the psychological hurdle at $9,000, which, if breached, would open the door to the descending trendline resistance, currently at $9,275.
The case for a corrective bounce would weaken if a 4-hour candle closes below $8,520 – the low of the hammer candle shown above. That would imply a continuation of the bearish move.
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| | | | Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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