Cryptocurrency Markets Stagnate As Institutions Show Interest In Bitcoin
Though institutional buyers are scooping up bitcoin, the cryptocurrency market as a whole seems to have plateaued. Those who analyze price-charts insist the indicators reveal bitcoin is not close to its overbought zone and has the potential to run further. All in all, ether and bitcoin have increased about 3% in the prior 24 hours. Shiba Inu’s SHIB jumped more than 5%. XRP popped slightly more than 3%. However, aside from these moves, the overarching crypto sector has been fairly quiet in the past 24 hours.
Crypto Is Showing Signs of Life
Though crypto as a whole has suffered a significant decline dating back to the end of 2021, it has held steady in recent days, indicating that the sector as well as the markets as a whole might be on the road to recovery. The space’s aggregate market capitalization breached $2.12 trillion, tacking on 2.1% in the prior 24 hours. It is interesting to note the top cryptocurrencies have been outpaced by Altcoins, ultimately spurring a decline in the bitcoin dominance index by just under 0.5%. The index has fallen to 39.6%.
FLOW was the top-gainer among altcoins. This unique crypto is a token created by the Flow gaming network. The idiosyncratic token jumped more than 10% earlier today after the gaming app that uses the network received official licensing through the International Olympic Committee for the creation of a game that will provide fun-seekers with the opportunity to participate in a digital version of the ongoing Beijing Winter Games.
Institutions Covet Bitcoin
Perhaps the most bullish sign for crypto as a whole is the fact that institutional buyers are scooping up bitcoin. Institutional demand has helped the alternative currency jump from slightly les than $35,000 to an impressive $45,000 in a week alone. Benchmark cryptocurrencies are clearly favored by institutional investors despite declines to start the year. These top cryptocurrencies have moved above the 50-day moving average, meaning the downtrend that characterized crypto across the prior three months might be coming to an end.
CoinShare reported that institutional investors have poured money into crypto funds through three consecutive weeks. Bitcoin crossed the important 50-day moving average at the start of the week, hitting the $42,500 price level and remaining above this mark in the days and weeks since. The continuation of the movement indicates strength and also positions bitcoin to build momentum toward reaching $49,000.
Price-chart tools determine price change magnitudes with readings higher than 70 viewed as indicative of overbuying and those below 30 being indicative of overselling. If the price-chart tool shows such readings, it is a sign of an emerging trend. Crypto investors should be aware that as of today, the quantitative easing program implemented by the Bank of England that helped buoy the prices of assets after the start of the pandemic was on schedule for a $4.1 billion loss.
Cryptocurrency holders and those who have been waiting on the sidelines during the carnage that started the year will also find it interesting that the relative strength index, or RSI for short, values for bitcoin have held strong at favorable levels. The RSI indicator in the context of the daily charts is currently at 61, meaning it is not even close to what analysts consider to be overbought. In other words, there is still plenty of upward movement to go before the crypto space can be characterized as overheating.