Altcoin Watch: AVAX, and UNI Trace Green Despite the Wider Market Slump
Rising inflation, a slowdown in China, and the war in Ukraine have caused investors to pull money out of risky assets such as cryptocurrencies. Bitcoin has lost about 37% of its value for the year, while Ethereum has lost about 48%. The total market cap of all cryptocurrencies has dropped from around $3 trillion in November to around $1.3 trillion in May.
Upside Potential?
In a note released Wednesday, Nikolaos Panigirtzoglou, a senior analyst at JPMorgan Chase, said that the company believes that Bitcoin has significant upside potential following its recent decline. The strategists at Morgan Stanley maintained their price target of $38,000 for Bitcoin. It represents a potential 29% increase from the cryptocurrency’s current trading level.
According to the Morgan Stanley team, the recent decline in the cryptocurrency market has been more like a capitulation than a bear market. They noted that they expect the cryptocurrencies’ upside potential to be more significant in the future.
For the company, digital assets and hedge funds are now its preferred alternative asset class. As mortgage rates rise, real estate is expected to be the next victim of this move. Despite maintaining their positive outlook on cryptocurrencies, the Morgan Stanley team downgraded their outlook on alternative investments to “underweight” from “overweight,” noting the macroeconomic challenges.
Shifting to UDSC
Due to the collapse of the connected Luna and TerraUSD stablecoin, many investors have changed their thinking about cryptocurrencies. The USDC has become the preferred stablecoin on the Ethereum blockchain, according to data.
According to data from blockchain analysis firm, CoinMetrics, the number of wallets that have over $1 million in USDC has overtaken those holding USDT, the largest stablecoin on the Ethereum blockchain.
The report also noted that the USDC’s advantage over the USDT in terms of the free float supply on the Ethereum blockchain had reached an all-time high. According to Kyle Waters, an analyst at CoinMetrics, the increase in the number of large holders of the USDC is most likely because they are usually the ones who can redeem the currency. However, it could also be that some investors are de-risking their positions. It is due to the monthly subscription guarantees of the USDC.
AVAX is Slightly Recovering
The price of AVAX has started to slow down and is finding support at around $28. The bulls are not inclined to push the price lower and must break the key resistance at $32 to turn the situation around.
The high volume during the crash on May 11th has created a local bottom around the $30 area. The daily RSI has also managed to stay below 30 points, but it has not rallied much. The daily MACD is still positive, but it shows a lack of conviction from the buyers. The bulls need to break the key resistance at $32 to confirm the signal.
The price of AVAX has been in a red trend for the past seven weeks, and it is now approaching a crucial point where the bulls can finally take over the market. If they can break above $32, the stock could start a recovery.
UNI Hodlers are Rising
At press time, UniSwap is trading at around $5.6, and it has been placed under the support of $8.4. This level is crucial for the token to continue moving higher. It was tested multiple times in the past, which signals that the company might want to increase its market cap.
Despite the various crashes that occurred in the past couple of months, the number of people holding the UNI token didn’t just stay the same. Over the last month, the total number of investors has increased by almost 3k. At the time of writing, the number of people holding the Uniswap token is 290k.
Despite the recent developments, the number of people holding the UNI token is still not panicking. In the last 24 hours, around 1 million of the asset was bought by investors. Following this, it managed to recover by a mere 3%.
