Looking at the charts of Bitcoin and altcoins today might give you the feeling you get when Spring first arrives after a long Winter.
Bitcoin’s price has shot up dramatically and a few altcoins have moved upwards alongside the grand-daddy of crypto.
It’s too early to tell how serious this new, positive activity is, but it definitely provides a bit of optimism after weeks and weeks of downtrending.
Trading volume for Bitcoin was enormous in the last 24 hours. Some have attributed it to the rumor that a $3 billion hedge fund client who is buying BTC through OKCoin. Others dispute that claim, but it does seem relatively likely that a huge new party is buying heavily. To some degree, that move is expected. Financial firms have continued to become more interested in cryptocurrency as they seek high returns. It’s only a matter of time until true “whales” purchasing Bitcoin for speculation.
Bitcoin has been declining in recent months based on an ‘oversupply‘ which could be corrected based on more vendor and customer adoption or bigger speculative pressure for those who buy to “hold.”
All it takes to turn skepticism into optimism in the world of cryptocurrency is volume.
Altcoin volume has not moved as sharply as Bitcoin volume in the past 24 hours. This is not surprising. Many people who have been holding an altcoin for some length of time may become very tempted to dump their holdings and turn them into Bitcoin while BTC is still up. That appears to have happened with Nxt, which was lambasted by dumps in the past 24 hours on Bter.com.
Now is a great time to gauge the relative value and public sentiment toward major cryptocurrency projects. Since Bitcoin has moved up you’ll want to see your favorite altcoin move up along with it. If the price drops dramatically, there may be bigger problems than you suspect. Today’s a great day to watch charts and see what new patterns emerge.
Now is an extremely telling time for altcoins. If the low trading volume trends continue, or if dumping really picks up, the alt sector could be in for a world of hurt. This is the exact time of the year where Bitcoin prices shot through the roof last year. If this magic repeats itself the effect on altcoins could be profound.
At the very least, some real excitement has hit the cryptocurrency scene this week. Now it’s going to be very important to watch what unfolds closely and make trading decisions based on what transpires.
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