Greed has taken over the cryptocurrency market. Thus, most altcoin projects have reached overbought status on leading indicators. According to crypto expert Vinicius Barbosa, in such a risky scenario, three tokens stand out that are more affected by these indicators and which investors should avoid trading in the coming week.
The market is overbought
cryptokoin.comAs you follow from , the market has heated up quite a bit this week. Some tokens filled the pockets of their investors with the rise they recorded. However, this overbought situation also brings risks. Notably, CoinGlass’ Relative Strength Index (RSI) heatmap shows this overall overbought situation on the 1-week time frame. On December 15, the average RSI was 72.05 points. So, the market is currently overbought.
Three altcoins in particular have a higher RSI on the 4-hour and 24-hour time frames. For proper risk management, cryptocurrency investors should avoid trading the following three cryptocurrencies next week.
Solana’s memecoin Bonk (BONK) is in first place, which is booming
Bonk (BONK) brought huge gains for early buyers. That’s why the altcoin is trending on social media. However, its purely speculative nature carries a high RSI reading and extra risks for traders. This meme-coin is the first dog-themed cryptocurrency on Solana (SOL). Given the massive 60 trillion BONK circulating supply, CoinGlass indexes it as 1000BONK. 1000BONK is changing hands at $0.02772, up 88% on the day. (BONK $0.00002772 according to CoinMarketCap) Interestingly, BONK remains overbought with RSIs of 76.41 and 82.52 on both the 4-hour and 24-hour charts.
Indicators also turned red for this altcoin: Aave (AAVE)
Unlike BONK, Aave (AAVE) is a solid DeFi altcoin project to invest in for 2024. Leading lending platform supporting 10+ Blockchains, using its token for governance and liquidity mining. Interestingly, the 24-hour Relative Strength Index is recording strong momentum. However, AAVE appears overbought on the 4-hour and 1-week periods, with RSI points of 78.07 and 79.38 respectively. At the time of writing, the token was trading at $115.49, up 20.11% on a daily basis.
The last altcoin on the list: Internet Computer (ICP)
The last token that traders should avoid trading at this point is Internet Computer (ICP). Essentially, ICP was trading at $7.17, up 11% in the last 24 hours. The altcoin remains overbought on all timeframes. The token has 4-hour, 24-hour and 1-week RSI indicators of 74.9, 76.86 and 89.49 respectively.
All things considered, any of these three altcoin projects mentioned to avoid trading next week could still perform well in the volatile and unpredictable cryptocurrency market. Value is subjective and it is possible for speculation to drive prices and rankings up despite the considerations we have mentioned.
The opinions and predictions in the article belong to the expert and are definitely not investment advice. We strongly recommend that you do your own research before investing.
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