What a difference a day makes! (You know I was dying to say that.) And to be fair it was really about 30 minutes. That’s the time it took ETH to drop from $105.50 down to $100. BTC followed a similar path from $3,420 down to $3,555 as did XRP from $0.2940 to $0.2860.
Misery loves company as the saying goes. Another one of these moves without any obvious catalyst after a period of stability followed by some consolidation at a new level. This is almost becoming the norm for crypto now and as I hinted in yesterday’s commentary it just ‘felt’ as though there was a quick move lurking somewhere. But the excitement isn’t over with yet, as without warning ETH takes off from $102.50 back to $105.30, virtually unwinding the entire day’s move! Why? No idea. But the spike up was as short-lived in duration as the original move lower and back to $102.80 we came. The end result is we are now trading at lower levels and the general malaise hanging over the crypto market shows no sign of abating.
I always try to keep the commentary balanced so I shall end this part by noting that Facebook has made their first foray into the blockchain world by hiring the team from Chainspace, a small startup in London. A sign of bigger things to come maybe? We shall see.
My chart from earlier in the week which compared BTC with ETH, XRP and LTC garnered a fair amount of reaction. For that, I am always grateful. But the one common observation was, ok you’ve compared some top coins, but what about some of the lesser known ones? So today I have taken BTC once more and compared it to coins ranked 50 and 99 by market capitalization (go much deeper than that and it’s tough to find data). That’s Steem in the purple and pink and Dent in the yellow and green. This is an hourly chart going back to November.
Now I will admit that our friends at Steem have seen some nice divergence in the latter part of January but appear to be coming back to the party as we slide our way through February. That aside you would have to say the correlation to BTC is fairly impressive. And that’s my argument, we need differentiation of projects so the strongest attract capital and the weakest disappear. Right now the respective prices of coins big and small are far too much a function of BTC or ETH.
Disclaimer: All opinions expressed by Jim Preissler are solely his opinions and do not reflect the opinions of Forbes, Forbes CryptoMarkets, their parent company or affiliates. [Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.] With additional commentary & technical analysis by David Hannigan.