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Bitcoin: positive reaction for the post halving price
Bitcoin: positive reaction for the post halving price
Trading

Bitcoin: positive reaction for the post halving price

By Federico Izzi - 13 May 2020

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More than 24 hours after the third Bitcoin halving on Monday night, the celebrations and the positive reaction of the Bitcoin price continue. 

Many were expecting a substantial retracement due to mining activity which, through a network adjustment, could have led the less profitable miners to shut down the old machines and cash in part of the Bitcoin deposit accumulated in this last period. 

However, this is not happening, to the extent that the price of Bitcoin on Monday night – precisely at 9.23 PM (CET) when the halving block was mined – was close to $8,500 and even yesterday Bitcoin remained above this level with peaks that during the night saw pre-halving levels in the $8,900 area. 

It is worth remembering that on Sunday, May 10th, Bitcoin’s price dropped sharply from 9,500 to 8,100 in just under an hour with a flash crash during the day. In any case, Bitcoin’s reaction after the halving is a positive sign.

Bitcoin in the DeFi sector

The other positive signal is Bitcoin’s activity in the DeFi space. Yesterday a large transaction saw 1,000 synthetic Bitcoins minted using the ERC20 standard to be used in decentralized finance. 

This has led wBTC, the ERC20 token that locks Bitcoin on the DeFi network, to double the total capitalization to over $20 million, thus greatly overtaking the Lightning Network, which is the official Bitcoin development network that currently has just over $8 million locked in value. 

This demonstrates how Bitcoin is spreading and attracting attention also for DeFi activities. This happens less than a day after the third Bitcoin halving and is a further positive sign, identified by a single transaction that with a countervalue of about 9 million dollars, indicates that this is due to a so-called Bitcoin whale. 

coin360 20200513
Source: COIN360.com

The prices of the altcoins

The day sees a slight prevalence of positive signs with more than 60% above parity. Among the big ones are Monero (XMR) and the Leo (LEO) token that rise by about 3%, resulting in a positive weekly balance, the only two among the big ones, together with Cardano (ADA). 

XLM 20200513

Cardano today slips by 1%, thus also losing the 11th position in favour of Stellar (XLM), which achieves one of the best rises of the day, +6%. Stellar with today’s jump strengthens the recovery that from the lows of $0.058 sees it gain more than 17%, recovering the value of $0.070. 

It is worth noting that with the recent rises that saw Stellar reach the top 10 days ago, it recorded one of the best performances since the lows of mid-March, recovering 180% of its value. 

Some of the best of the day, among the top 100 with double-digit increases, include DigiByte (DGB) which rises by 25% and Electroneum (ETN) which jumps on the podium with over 30% increase. Among the best known in the industry, the intraday climbs of Waves (WAVES) and Zilliqa (ZIL) are also positive, exceeding 15%. 

The markets are trying to build support and this allows to react to last Sunday’s declines. This allows the market cap to stabilize between 240 and 245 billion dollars

The dominance of crypto

Bitcoin dominance remains above 67%. Despite the good performance of the last 24 hours with balances above parity of both Ethereum and Ripple rising just under 1%, the dominance of both remains at the lowest levels of the last month, just under 8.7% for ETH. 

Whereas Ripple is increasingly weaker at 3.5% market share, the lowest level since December 2017. This highlights Ripple’s difficulties, which highlight the strong consolidation by stablecoins that are increasingly eroding interest and capitalization even to the detriment of XRP, which can be compared to a stablecoin. 

This allows Tether, with the increase in capitalization these days, to put at risk Ripple’s third place in the ranking of the most capitalized stablecoins.

BTC 20200513
Bitcoin chart by Tradingview

Bitcoin (BTC) price

The reaction in the last few hours brings Bitcoin prices just below the psychological threshold of $9,000, an important technical threshold already highlighted often in the last period. 

Fluctuations in Bitcoin prices continue to be recorded within the bullish channel that began in mid-March. For Bitcoin, at the moment the risks would only emerge with sinkings to Sunday’s lows in the $8,100 area.  An area recovery of $9,200 would likely attract new purchases.

ETH 20200513
Ethereum chart by Tradingview

Ethereum (ETH)

Ethereum sees the consolidation of the $185 area, a level necessary for the holding and for the recovery of prices within the bullish channel, abandoned with the weekend fall below $190 area. 

In these hours, the prices of ETH return to this level. It is necessary for Ether to recover the $200, otherwise it must not go below the Monday afternoon lows at $175, the lowest point in the last 3 weeks.

 

Federico Izzi
Federico Izzi

Financial analyst and independent #trader – S.I.A.T. & Assob.it partner. He operates actively on stock and derivatives markets (futures and options) since 1997. A precursor of cyclic-volumetric analysis he is known for having identified the most important upward and downward movements in the financial markets of recent years. He participates annually as a speaker at the ITForum in Rimini since the 2010 edition and InvestingRoma and Napoli since the first edition of 2015. He is a guest and market expert on the "Trading Room" and "Market Driver" broadcasts of Class CNBC, Borsa Diretta.tv and on the evening news of Traderlink. Since July 2017 he is a permanent guest on LeFonti.TV, the only weekly national space dedicated to cryptocurrencies alongside the most important international experts in the field. He was interviewed as a cryptocurrency expert for Forbes Italia, Panorama, StartupItalia and DonnaModerna. He was recognized as the first Italian technical analyst to have published the first secular cyclic analysis on Bitcoin. Periodically publishes articles on ITForum News, Sole24Ore, MILANOFINANZA, TrendOnLine and Wall Street Italy. Federico Izzi is... "Zio Romolo".

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