In this report, we try to provide an overview of the crypto market during the last month.
The last thirty days saw a general strong uptrend for the market. Bitcoin paved the way with a very strong performance which cancelled the fallback of March. Altcoins followed united, with all the sectors and the sizes of projects which performed very well on aggregate.
The main factor driving up Bitcoin’s price was the approaching of the halving event, which is expected to before the half of May 2020. On that day, the block reward for the main blockchain in cryptocurrency space will decrease from 12.5 to 6.25 coins. This could lead to a lower amount of BTC in circulation and, therefore, a supposed price rise due to scarcity of the offer. Moreover, past Bitcoin’s halving events always lead to price rise.
BTC Technical Analysis show currently a huge dynamic resistance being faced. This is the downward trendline originating from the all time high price of December 2017 and going through the relative maximum prices occurred since then, in June 2019 and February 2020. We called, in our latest Weekly Market Report, that the upward violation of the 99-period weekly Moving Average would have led the price to face the next big resistance in this line. That is exactly what happened, and an eventual violation of it could open up the field for an extensive price rise.
Altcoins followed BTC in its positive trend and even overperformed it for the vast majority of April, leading to a fall in dominance. However, BTC’s performance in the last days of the month was superior than Altcoins’ one. Therefore, the current situation sees a dominance in line with the end of March but the whole market significantly up.
Factors influencing Altcoins’ performance were mainly linked to their technological appeal. With respect to this, the publication of the latest ratings of crypto projects by Weiss Ratings underlined the technological appeal of some of the biggest projects and was crucial in giving boost to the rally.
Another important factor in this month rally could be the muted trend in traditional financial markets. While March was characterized by the Coronavirus outbreak which led to a very strong sell-off in the stock market, April was a month of recovery. In March, the sell-off involved also BTC and it is possible that investors in traditional financial markets sold their crypto positions in order to cover for stocks-induced losses, crushing crypto market in the process. This kind of selling pressure was absent in April and hopefully will be also missing in the future.
April was the month of Platform projects and projects with the highest capitalization. Out of the 10 best performyng cryptos, seven are platforms, including all the first six.
As already mentioned, Bitcoin’s halving was not the only factor catching the attention of investors during the month. Technological appeal was under the spotlight as well, and Platforms are on the frontline in that department.
Weiss ratings saw five platform projects at the top of the Technology category: Tezos (XTZ), Cardano (ADA), Cosmos (ATOM), the small Fantom (FTM) and Ethereum (ETH). ADA and ETH were in the top six in terms of performance already mentioned, while Tezos was nothing less than the very best.
Generally speaking, all top projects were very correlated and have shown the best performance among our indexes, outperforming BTC on aggregate.
Tezos grow 71% m/m and settled at 2.75 USD and is still well below its year high level reached on February at 3.86. It is in the top 10 of all projects in terms of market capitalization and it recently annouced a collaboration with Chainlink (LINK), another projects in the top five in terms of performance, in order to exploit Chainlink’s Oracles in developing smart contracts.
The worst projects were mixed in terms of composition, with Holo (HOT) reporting the worst result but still finishing with over a 5% increase for the month. All the projects in our sample, therefore, finished with a gain, which again testifies the overall strenght of the market.
A special mention has to be reserved for Bitcoin Cash (BCH), which was among the worst performer of the month. BCH already sow its halving event in April, but the price fell consistently after it. Despite the minor attention that the event received, investors obviously hope that such a trend will not be repeated for BTC.
The technical analysis show how the top performing coins are all in overbought territory according to RSI, exception be made for Chainlink (LINK). The majority of the movement for LINK happened before the last week, therefore the phase of relative correction has already begun. The same indication can be found in the MACD indicator, which is signaling a very positive setting for all the top projects, with LINK approaching the zero.
The worst 10 performing projects show a very particular technical setting, which reflects the overall very good shape of the market. No one of the project is indeed in an oversold territory according to RSI, while NULS (NULS) is actually approaching an overbought level. The same can be said about MACD, which is representing a positive setting all over the spectrum, with only MCO approaching zero.
The frequency distribution of prices relative to BTC show how Bitcoin overperformed its peers in this category in the last month and in the last period in particular, with only Dogecoin (DOGE) keeping its pace.
Among Platforms, the same can be said about Ethereum, which outperformed the vast majority of its peers, with THETA and ADA the only ones recently able to negate this trend.
The views expressed in this report reflect the analysts’ personal views about the cryptocurrencies subject of the report. These views may change without notice and are subject to market conditions. The report is prepared for information purposes only and by no means constitutes a solicitation to investment or disinvestment. All the data are taken from Binance at 00:00 UTC on the 1st of May 2020. USD and USDT are used interchangeably for illustration purposes. All the presented valuations, indicators, and analyses are subject to errors. The report is for personal use only and should not be republished or redistributed.