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01 Apr, 2021, 12:47 PM 5

One Year Bull Run

The Cryptocurrency Market is approaching a year since the start of the Bull run and March 2021 is producing yet another positive result with the Top 50 growth in excess of +20% thus far. The slowdown in growth experienced in the back end of February 2021 has been quickly recovered as new investor growth, hungry for exposure away from traditional finance space gathers momentum.

The US recorded yet another month of increasing inflation in February as the impact of mass printing of global reserve currency in 2020 continues to boost asset prices globally. The deflationary aspects of Bitcoin make it a sort after store of value given the global economics circumstances and certainly an asset class impossible to ignore. 

Every "down" day in the markets seems to be met only by accelerated growth in the number of new wallets entering the relevant Blockchains to invest in more Crypto Assets. Investors are seeking new entry level points and "down" days present these opportunities. Demand continues to outstrip supply and we expect this imbalance to last for at least another 12 months. 



Bitcoin Technical Outlook Early March 2021

Last month Bitcoin found significant support close to the $42k level before experiencing strong growth in market volumes. This is extremely bullish price action which then led to the market breaking upward once more through the $50k mark.

We expect market consolidation over the next couple of weeks with support at the $50k level before higher moves and a retesting of the previous ATH.

The NFTs Craze

Bitcoin has experienced a lackluster March 2021 (-3.1%) as the strong run we have experienced since November last year starts to wane. The Bulls are tired and taking a breather. Nevertheless, there have been some huge gains in the rest of the Top50 lead by Enjin (+333%), Theta (+291%) and Hedera (+132%).

Over the past couple of months, the debate around Non-Fungible Tokens ("NFTs") has reached a climax. Millionaire artists around the globe are falling over themselves to gain a piece of the action as COVID-19 took its toll on these artist's earnings in 2020. NFT's offer a new potential revenue stream.

The Enjin project / protocol (ERC1155 / 721) is built and designed to support the minting of tokens backed by the artworks created by artists and allow for the tokenholders to stake claim over these assets. This increase in activity and demand for NFTs has led to a strong demand for ENJ. Owning ENJ can be viewed as one's indirect exposure to the NFT market.

There are still a lot of unanswered questions in the NFT space despite seeing massive gains since late last year. The biggest hurdle is authenticity verification over the underlying artworks and maintaining the exclusivity associated with the ownership.


Bitcoin Technical Outlook Late March 2021

Bitcoin is struggling to find support at the $54k (significant support level) in the short term. Therefore, it is likely the market will go to $42-44k levels in the short term to find support. Recently the BTC has struggled to break above the $58-9k level meaning that the market is a tad overrun.

BTC continues on its bull run despite the expected weakness / consolidation expected over the next month over the medium term and we expect a retesting of previous highs in mid-2021.

 

 

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