Ethereum Price Could Test Highs Before a Pullback, BTC, GRT, IOST, Jan. 18

Ethereum Price Could Test Highs Before a Pullback, BTC, GRT, IOST, Jan. 18

Ethereum recovered from last week’s selling and could hit all-time highs this week. BTC slow to recover from 30% drop. GRT and IOST up 135%.

ETH

Ethereum came close to testing its all-time high recently as the coin joined the Bitcoin market rally and vaulted to a price above $1,300. These highs then met last week’s spot market selling with a drop to $900. The lows were easily erased and the coin recovered much of the losses, hinting that another push higher was possible.

After a year of development, the Layer-2 Ethereum solutions provider Optimism has seen a soft-launch on the mainnet. The project seeks to solve the issues of GAS costs for DeFi projects running on the ETH blockchain. In a blog post, Optimism said:

“For the last year, we have been building relentlessly to satiate the demand for an easy-to-integrate scaling solution with lightning-fast transactions. Today, it is finally time to take our first material steps towards alleviating the gas crisis by deploying to mainnet.”

The plan is to make transactions faster and cheaper by running smart contracts outside of ETH only storing the results on the root chain. This will remove the scaling obstacle and ensure that projects don’t have to look outside of the ETH blockchain, as they were starting to do, following the rally of DeFi coins in summer 2020.

ETH is nicely poised at $1,250 for a push to the highs but beware of a potential US dollar recovery rally in the near future.

BTC

Bitcoin led the market selling last week with a Monday dump to the $30,000 level. This set up a nice $10,000 range, which will define the next path for Bitcoin. There is a possibility that the market makes another push higher before a larger correction in the coin.

BTC has struggled to recover from the correction which saw a 30% fall in price and marked the largest drop since September. The coin now trades above $36k and the market has shrugged off a warning from European Central Bank President Christine Lagarde who called for global regulation.

Lagarde said in a Reuters virtual conference:

Bitcoin is a highly speculative asset, which has conducted some funny business and some interesting and totally reprehensible money laundering activity.

Without highlighting any particular activities the ECB chief went onto add,

There has to be regulation. This has to be applied and agreed upon … at a global level because if there is an escape that escape will be used.

This has been an issue I have covered in the past and the money laundering issue is just the excuse that the policymakers will use. The reality is that they do not want to lose control of the money supply. If a decentralized asset such as Bitcoin becomes the keystone of the financial system, the bankers would lose control of the financial system. The current system is only still operating with trillions of bailouts, which is seeing larger and larger sums thrown into the system.

China has been a frontrunner in developing its own central bank digital currency (CBDC) but Lagarde has confirmed more recently that a digital euro is likely to emerge alongside the fiat version of currency. The movement is likely to ensure that currency cryptos are at risk from regulation, while other projects are safer. This is highlighted with the recent SEC action against XRP.

BTC currently has a market cap of $675 billion, while the cryptocurrency market sees a valuation of over $100 billion.

IOST

IOST was a top-performer on the week with gains of over 125%. IOST previously launched its mainnet around 2018 and has since been moving the project towards the decentralized finance (DeFi) space.

In early 2019, the IOST development team began developing a reliable DeFi ecosystem foundation with the goal of building the first public blockchain with in-built DeFi support. The project also saw work on the network’s cross-chain stablecoin, the iUSD, while also continuing work on its decentralized exchanges and other solutions.

Staking was introduced and this opened up new doors into the DeFi world and this has led to new partnerships. The project has been listed on the Blockchain-based Service Network (BSN) as an accredited developer in China. The project shared news recently where they ranked at number 3 in the CCID Global Ranking which ranks the best blockchain projects according to the think tank and software evaluators. EOS and Ethereum edged the coin out, which scored highly on its ‘basic tech’.

The coin’s performance last week was based on rumors of a possible announcement as IOST co-founder Terrence Wang has been teasing his Twitter followers with hints of an IOST-based stablecoin, DeFi integration, and new partnerships.

A gaming option has also recently been added with XPET’s 2D Game “Dream Monster” landing on the IOST blockchain. Players can store and trade in-game assets such as rare pets, equipment, and other special character upgrades in the form of NFTs on the IOST chain.

IOST has been around a lot longer and the coin has traded around the $0.0600 level for most of the year before the recent rally. This could suggest that the recent gains have marked a significant bottom in the price.

The coin was trading at the $0.0050 level before a strong two-week rally, where the price hit highs near $0.03. The price has now settled back at $0.0195 as traders decide on the next path. The project now has a market cap of over $300 million and ranks at number 78 in the list of coins.

GRT

One of the top-performing coins this week was ‘The Graph’ (GRT) which rallied 125%. The project is a relative newcomer but already trades at number 50 in the list of coins by value. The Web3 project now has a valuation of $785 million and seeks to remove the need for custom servers in data storage.

On the project’s mainnet they are seeking to build a “marketplace of service providers ensures that data remains open and that dApps continue to run no matter what.” A more detailed explanation of the project’s capacities is available on The Graph’s website.

The price of GRT rallied from $0.5000 to the current price of $0.6400 and the high price for the coin is 0.8000 which would be the target for the week.

GRT Reclaims Support and Aims for $0.47

The Graph (GRT) has reclaimed the previous breakdown level and validated it as support afterwards. As long as the newly created support area holds, GRT should continue increasing towards the resistance areas at $0.47 and $0.59.

Reclaim of Support

GRT has been moving downwards since Dec. 20, when it reached a high of $0.783. On Dec. 26, it reached a low of $0.32 and initiated a bounce, which was short-lived.

The ensuing decline took GRT to a low of $0.28 on Jan. 11. Nevertheless, it reclaimed the $0.325 area shortly afterward and validated it as support on Jan. 7. As long as GRT is trading above this level, it should continue moving upwards.

If it does, the next resistance areas are at $0.47 and $0.59, the 0.382 and 0.618 Fib retracement levels, respectively.

Cryptocurrency trader @TeddyCleps outlined a GRT chart, stating that the ensuing breakout could take it to $0.48. The area coincides with the 0.382 Fib retracement level, making it a very likely level to act as resistance.

Short-Term Movement

The shorter-term two-hour chart shows that GRT has bounced at the 0.618 Fib retracement level at $0.34 and is trading above it. As long as it does, the recent decline is likely just a correction that will eventually create a higher low and take prices higher.

Nevertheless, technical indicators are bearish, failing to provide any bullish reversal signs.

A fall below the $0.28 low would indicate that the upward move has ended and GRT is heading lower.

Conclusion

To conclude, due to the lack of sufficient price history and confirmation for indicators, the GRT trend is unclear. In any case, whether GRT trades above or below the $0.325 area should act as a gauge for the direction of the trend.

For BeInCrypto’s previous Bitcoin (BTC) analysis, click here!

Disclaimer: Cryptocurrency trading carries a high level of risk and may not be suitable for all investors. The views expressed in this article do not reflect those of BeInCrypto.

Here’s why HedgeTrade (HEDG), The Graph (GRT) and UMA are rallying

Bitcoin (BTC) has been consolidating for the past few days as the bulls and the bears battle it out for control over the largest cryptocurrency by market capitalization.

Currently, Bitcoin looks like it is steadily losing its upward momentum but Vailshire Capital Management founder and CEO Jeff Ross has maintained his bullish stance and believes the uncertainty will resolve to the upside.

Crypto market data daily view. Source: Coin360

While Bitcoin consolidated, the action shifted to Ether (ETH), which made a new all-time high, eclipsing its 2018 high at $1,428. This suggests that the crypto markets remain in a firm bull grip.

The rally from the leaders is usually followed by strong breakouts from tokens that are likely to benefit in the current environment or have come up with positive developments that have caught trader’s attention.

Let’s inspect the possible fundamental and technical reasons for the rally in the three tokens selected today.

HEDG/USD

The crypto bull run has been in place for the past few weeks and this trending move offers a great opportunity for traders to make a quick buck. While initially the rally was mostly oriented around Bitcoin, it has broadened in the past few days with several altcoins joining the party.

In such an environment, experienced traders maximize their gains but less sophisticated investors with limited capital are not fully able to take advantage of the bullish trend. This is where Hedge Trade (HEDG) comes in as it’s designed to allow novice traders to mirror the activity of professional investors.

HEDG had been in a strong downtrend for the past few months, but it surged from $0.365 on Jan. 13 to an intraday high at $2.40 on Jan. 14, a 557% rally within two days.

HEDG/USDT daily chart. Source: TradingView

After such a massive rally in a short span, profit-booking was to be expected, however, the HEDG/USD pair is currently finding buying support close to the 61.8% Fibonacci retracement level at $1.14237.

The long tail on the Jan. 18 and Jan. 19 candlesticks suggest that there is strong buying at lower levels. If the bulls can push the price above $2, the next leg of the up-move with a target at $3.43 could begin.

The upsloping moving 20-day exponential moving average ($1.045) and the relative strength index (RSI) near the overbought zone suggest bulls have the upper hand.

This positive view will be invalidated if the price turns down and breaks below the 20-day EMA. Such a move will suggest that the recent rally was a possible pump and dump scheme.

GRT/USD

If the current bull market continues and cryptocurrency adoption furthers, the need for a decentralized protocol for indexing and querying large amounts of blockchain data will increase.

Since June, the number of queries on The Graph network increased from 1 billion to about 10 billion in November, a ten-fold increase. The Graph believes this growth is likely to increase further, hence the company is on a hiring spree.

The company’s growing popularity has als attracted several teams and individuals to join the network as indexers, curators, and delegators. Within 19 days of its mainnet launch, $1 billion GRT was staked, indicating that there is strong demand for the token.

While the fundamental developments are bullish and point to possible sustained growth, do the technicals also signal that there is strength?

GRT rallied from an intraday low at $0.2333 on Jan. 12 to an intraday high at $0.6642 on Jan. 18, a 184% rally in a week. However, the bears are unwilling to give up as they are currently attempting to defend the $0.6545 overhead resistance.

GRT/USDT daily chart. Source: TradingView

If the bulls do not allow the price to dip below the 38.2% Fibonacci retracement at $0.4996, it will suggest that traders are accumulating on dips.

A strong rebound off this level could form the handle of a possible cup and handle formation, which will complete on a breakout and close above $0.6545. This setup has a target objective of $1.0757. However, a straight dash to the pattern target is unlikely as the bears will try to aggressively defend the $0.7858 resistance.

This positive view will be invalidated if the pair dips and sustains below the 50% retracement level at $0.4488. If that happens, the pair may remain range-bound for a few more days.

UMA/USD

Universal Market Access (UMA) allows users to create priceless synthetic assets on Ethereum blockchain. Instead of limiting itself to traditional financial instruments, the protocol is expanding its reach and building the optimistic oracle, which may be used for insurance, betting, and prediction markets.

Another interesting development in the pipeline is a perpetual contract that supports synthetic assets without any expiry and are executed pricelessly.

UMA formed a partnership with YAM Finance in early December of 2020 and the team transferred the management of uGAS to YAM. The new team launched Degenerative Finance and offered a synthetic futures contract based on the 30-day median gas fees.

The timing of the launch was perfect because Ethereum gas prices surged in January and the futures would have given an opportunity to traders to hedge their fees or just trade it.

As part of UMA’s dapp mining initiative, OpenDAO built a new interface for the Yield Dollar, a precursor to the development of USDO stablecoin, which is proposed to be backed by several assets that could be from crypto, stocks, or even real estate.

The protocol is opening a world of opportunities to developers and traders. Let’s see how UMA token has been responding to these developments and whether there are any investing possibilities.

UMA rallied from $7.87 on Jan. 13 to an intraday high at $12.80 on Jan.19, a 62% rally in a week. The bears are currently attempting to stall the rally at the overhead resistance near $13.222.

UMA/USD daily chart. Source: TradingView

However, a positive sign is that the bulls are not giving up much ground, which shows that traders are not hurrying to book profits after the recent rally. The upsloping 20-day EMA ($9.51) and the RSI in the overbought territory suggest that bulls are in control.

If the bulls can propel the price above $13.222, the UMA/USD pair could start a new uptrend that could reach $16.30 and then $19. The momentum could pick up further if the bulls can push the price above $20.315.

On the contrary, if the pair turns down from the current levels or the overhead resistance and breaks below $10, it will suggest a lack of demand at higher levels.

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.