The cryptocurrency market has ended the weekend in a state of relative stability. Bitcoin and the majority of major altcoins ended Sunday in much the same manner as they started, and now move into October with the possibility of having found some new foundations.
Done With Yearly Lows?
Bitcoin’s yearly low of $5,984 on August 14th appears to have been the worst for the year. Every dip since then has rebounded at the $6,000 range, and at this point in time Bitcoin can compete with major world currencies in terms of volatility, or lack thereof.
Ethereum took a while longer to hit its fourteen-month low when it dipped to $170.26 on September 12th. The recovery since then places ETH at the $230 range, with the $200 mark now appearing to be a solid stronghold.
Among the altcoins in the top one-hundred, those that didn’t fall with Bitcoin in August instead sunk with Ethereum in September, and since then none have fallen further outwith of market bounds. In fact many have outperformed the market in what may be the beginnings of an altcoin divergence.
While the market surge of 2017 can be traced back to April, the serious gains began to appear in October, when Bitcoin and Ethereum both surged 50% over thirty days.
Remarkably, last year’s pattern is similar to this year’s – Bitcoin underwent a disastrous dip in the autumn months (Sept 15th), falling 40% in the space of two weeks. Everything since then was pure upward momentum – although this year’s recovery has been more stable than spectacular at this point.
Many had pinned the expected acceptance of the VanEck ETF proposal by the SEC to be the trigger for this year’s surge. The decision to delay the outcome until December may stretch out that process, although last year’s market surge happened without ETF’s, so the cryptocurrency market is hardly dependant on it.
A New Normal
XRP is now just a few hundred million behind Ethereum by market cap, and could end up cementing its spot as the number two cryptocurrency if Ethereum fails to match its recovery. The good news for XRP fans is that trade volumes have remained in the coin even after the recent 23% retracement.
When volumes jumped from $300 million to $5 billion during September’s spike, it marked the highest volume of XRP traded since January. Despite falling by a considerable margin, XRP trades have stayed near or above the $1 billion range for the last few days, matching that of Ethereum.
If that turns out to be the new normal, then it represents either a new influx of money into the crypto space, or merely a rearrangement of funds. Given the impact of the XRP retracement last week, when the $13 billion lost by XRP made up 60% of the market-wide losses, it seems the former could be more likely.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.