The past few weeks have been hot for altcoins as many experienced large runups with some market favourites rallying over 2x.
The bullish momentum has taken a back seat this week as we have seen the altcoin market cool off, as selling volume increased across the board.
$SAND started the year off with a bang as the coin rallied over 100%. This week we have seen volume increase 165% on our Convert Portal with the majority being selling.
$SAND is currently down just over 23%, as another 372.5 million SAND tokens have been added to circulating supply. As a result speculators were quick to sell in anticipation of further price drops.
$AGIX is one of the worst performers this week as price dropped over 30%. $AGIX saw a huge run up from the start of the year as the AI narrative took the market by storm, fueling the price rally.
Whilst it is unclear why price is selling off, it is likely to be a market correction with no signs of where it may stop.
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Convert Portal Volume Breakdown
The overall market has remained range bound the past couple of weeks, moving level to level, well respecting the zones we had previously marked.
This week we have seen the news surrounding Paxos and BUSD, this caused slight turmoil but was immediately addressed by CZ stating that funds are #SAFU, read more here.
To no surprise we have seen a huge increase in Stablecoin swap transactions this week, coming in with a record high value of 63.98%. This is one of the highest we have seen so far, as users were quick to react to the news.
Crypto to stablecoin transactions placed 2nd this week with a value of 12.43%, this is one of the lowest we have seen, with stablecoin swaps dominating this week it is unsurprising the other transactions have taken a back seat.
Stablecoin to crypto transactions placed third this week with a value of 9.97%, ahead of volatile news events (CPI) speculators look to capture moves to the upside.
Overall market technicals
BTC
The overall narrative remains the same for BTC, we previously identified two ranges that have been interchangeably well respected, as BTC continues to play level to level.
This week CPI data was released in the US causing volatility across all markets. The reading came in at 6.4% vs 6.2% estimated, BTC initially dropped 1.5%, however soon reversed at the market open as risk-on sentiment took over and BTC jumped over 3%.
As it stands BTC is sitting well within the range identified, it is safe to assume that these levels will continue to be respected. In order for price to continue to the upside we will need to see a clear break through the current resistance and flip back to support.
The upside targets still remain the same with the first being the range resistance around $23,350 and the second being the deviation highs.
SAND
$SAND saw rapid expansion at the start of the year following the rest of the market. Metaverse tokens caught flame as the industry tokens exploded, SAND being one of them.
Since the end of last month $SAND has found itself trading within a large range on the 4 hour chart.
Last week Tuesday, $SAND attempted to break out of the range which was short lived as it quickly made a return back inside.
Currently $SAND is trading at the lower end of the range, as the midpoint held as a strong short term resistance.
We can see deviations as it briefly fell outside of the levels, we would need to see this range continue to hold for a chance to trade back towards the upside.
Alternatively, if a breakdown occurs and the range fails to hold we are likely to trade back towards areas of previous resistance in anticipation of them acting as support.
Macro at a glance
Last Tuesday (Feb 6th), RBA announced a 25bps rate hike, as the market anticipated. AUD/USD soared from 0.6886 USD to 0.6986, up 1.45% in 2 hours, before giving back most of the gain and falling back to the 0.6905 support level. RBA stated that they are having two more 25bps rate hikes, which will bring OCR to 3.85%, before looking for a pause, to achieve their priority to 2% inflation target.
Last Thursday (Feb 9th), several Fed officials said the rate hike will continue at a moderate pace. The US dollar index ($DXY) gained 0.6%, and the US 2-Year Treasury yield jumped from 4.40% to 4.51%. All risk assets had a headwind, with BTC dropping 4.6% from $22800 to $21695.
Yesterday (Feb 14th), the US CPI reading was reported as 6.4% vs 6.2% estimation, decreasing 0.1% since January's reading. Inflation is stickier than the market expected, and a continued Fed rate hike is likely to persist.
Markets across the board were extremely volatile with wild swings in both directions. US Treasury Yields soared on all durations.
Equities and Crypto initially saw a move down and climbed back during the US session. The S&P500 closed down 0.03%, while the Nasdaq index closed up 0.71%.
BTC and ETH are up 1.96% and 3.35% correspondingly.
This Thursday we have US Retail Sales Data reporting and the Eurozone CPI reading the following Thursday.
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