As a researcher with experience in cryptocurrency analysis, I find the current market situation intriguing but uncertain. The past two weeks have seen Bitcoin and Ethereum prices fluctuating without committing to a clear direction. However, Ki Young Ju’s analysis of Bitcoin’s Thermo Cap Ratio suggests that the leading digital asset is not currently overvalued based on network fundamentals.
For the past fortnight, the crypto market has displayed hesitance and instability, failing to make a definitive move in any direction. This uncertainty is reflected in the prices of major cryptocurrencies, such as Bitcoin and Ethereum, which have been forming short candles on their daily charts.
In a recent analysis presented by Ki Young Ju, the CEO of CryptoQuant, the Bitcoin Thermo Cap Ratio emerged as a valuable indicator for assessing the relationship between Bitcoin’s price and its underlying network fundamentals.
#Bitcoin is not currently overvalued based on network fundamentals.
— Ki Young Ju (@ki_young_ju) June 3, 2024
As a researcher studying the Bitcoin market, I’ve come across an intriguing ratio called the Thermo Cap Ratio. Unlike commonly discussed metrics, this ratio sheds light on miners’ cumulative expenditures (or thermo cap) relative to the current market capitalization. Despite recent price escalations, according to Ki Young Ju’s analysis, Bitcoin does not appear overvalued based on network fundamentals.
As a crypto investor, I’ve noticed that the market seems to be gathering steam once again during this phase of consolidation. It’s quite possible that we might witness the continuation of the current uptrend very soon.
1) Ethereum Price Treading Dangerously
Ethereum is a unique decentralized platform, distinguished by its capability to host not just digital currencies such as Ether, but also smart contracts and decentralized applications (dApps) for their development and operation.
On Tuesday, the cost of Ethereum reached $3762 in the market. At the same time, its total market value remained at a staggering $452.1 billion. Amidst the present market instability, Ethereum has managed to maintain its position above the crucial support level of $3700.
At the current $3700 level, the daily chart shows multiple instances of rejected lower-priced candles, suggesting that buyers are actively guarding this support. Following a potential bounce back from this support, Ethereum’s price could surge by approximately 8.5% to test the resistance at $4,090. It is important to note that breaking past this resistance is essential for the bulls to continue their upward trend.
2) Cardano (ADA)
Cardano, represented by the symbol ADA, is recognized as a third-generation blockchain with a focus on research, security, and sustainability. Its unique selling point lies in its multi-tiered design, which isolates the transaction processing and computational layers, making it simpler to upgrade and manage.
The price of Cardano has been moving horizontally for almost two months, lying between two trendlines that converge to form a symmetrical triangle pattern. This altcoin bounced back twice from the upper boundary and three times from the lower, suggesting that traders are adhering to this chart configuration’s guidance.
At present, the price of Cardano (ADA) hovers around $0.455, with the lower trendline serving as potential support. The digital currency boasts a market capitalization of over $16 billion, securing its place among the top 10 cryptocurrencies by size.
When market conditions are in our favor, I believe coin purchasers will successfully surpass the resistance trendline, indicating the conclusion of the consolidation period. Subsequently, a post-breakout surge could propel the Cardano (ADA) price to reach around $0.62, with potential further growth up to $0.68.
3) PEPE Coin (PEPE)
As an analyst, I would describe PEPE Coin as follows: I’m examining a cryptocurrency project called PEPE Coin, which draws inspiration from the widely recognized internet meme, Pepe the Frog. What sets this initiative apart is its emphasis on community involvement and the lighthearted, unconventional ethos that pervades numerous meme-centric digital assets.
As a crypto investor, I’ve noticed an upward trendline developing in PEPE‘s daily chart, which has been supporting the current price recovery. After encountering some pullbacks, buyers were able to boost the coin’s value from its April low of $0.00000393 to a high of $0.00001725, resulting in an impressive 339% gain for those who held during this period.
The PEPE price dropped 17 percent to $0.00001434 in response to the market correction, causing its market capitalization to shrink to $6.035 billion.
As a researcher studying cryptocurrency prices, I can share that if the coin price approaches the previously mentioned trendline once more, it may encourage buyers due to increasing demand pressure. A possible rebound from this support level could lead to a challenge of the resistance at $0.00001725, with potential targets reaching $0.00002 and even beyond to $0.000024.
Takeaway
The recent market contraction, as indicated by Bitcoin’s price stability and Ethereum’s sideways movement, has temporarily halted the upward trend of most prominent altcoins. Nevertheless, optimistic signs from on-chain metrics such as the Thermo Cap Ratio suggest that the underlying bullish trend is still in place. As a result, this market pause could encourage investors to buy more and restore the recovery momentum, creating potential buying opportunities for new investors.
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2024-06-04 17:32