In the ever-evolving environment of the cryptocurrency market, recent developments have sparked caution among investors. As the altcoin market returns from a short-lived bull market, some investors are looking at cheaper entry points. However, others remain wary of potential risks. Here are the details…
APE, USDC and USDT need to be approached with caution
Analyst Vinicius Barbosa examines technical and fundamental aspects as well as the latest news and events affecting specific cryptocurrencies. Among these, ApeCoin (APE) stands out with a weak Relative Strength Index (RSI) and difficulties in the NFT market. Tether USD (USDT) is facing scrutiny despite a rise in market value, with BlackRock highlighting concerns about its reserves. Similarly, Circle USD (USDC) is seeing a decline in market value linked to stability issues and dependencies on traditional finance.
In this regard, cryptocurrency investors should generally avoid stablecoin trading. Tether and Circle were listed because they are the most relevant with the highest market cap and exchange volume. All things considered, any of the three cryptocurrencies mentioned to avoid trading next week could perform both well and badly in the following days. Barbosa advises investors to approach these three cryptocurrencies with caution due to the uncertainty surrounding their short-term future.
These altcoin projects show weakness
On the other hand, as the overall cryptocurrency market cap has increased from $831 billion to nearly $1.5 trillion in the last ten months, analysts are warning of potential corrections. Akash Girimath identifies three altcoins showing signs of weakness: Injective Protocol (INJ), Avalanche (AVAX) and Optimism (OP). Girimath recommends investors prepare for a 10% to 20% correction, emphasizing the cyclical nature of bull runs.
Bitcoin (BTC), one of the major players in the market, is signaling potential corrections on both weekly and daily time frames. The U.S. Securities and Exchange Commission (SEC) has pointed out a delay in ETF approval, adding to the uncertainty. While analysts put the Bitcoin spot ETF approval chance at 90%, a correction could impact altcoins more significantly.
What is the latest situation for INJ, OP and AVAX?
Injective Protocol (INJ) is up a significant 167%, but sell signals and the token unlocking in January 2024 point to a potential 17% correction. Avalanche (AVAX) and Optimism (OP) have made significant gains but face potential retracements of 30% and 20%, respectively. Girimath emphasizes the importance of monitoring these altcoins closely.
While the cryptocurrency market is witnessing both volatility and potential corrections, investors need to be careful. The unpredictability of the market requires a cautious approach, focusing on risk management. While certain altcoins are exhibiting weakness, the overall market remains dynamic. It also requires constant monitoring and adapting to changing conditions.
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