Altcoins have been bigger winners than bitcoin in the recent rally. Despite the latter leading the rally, smaller-cap coins have been making all the waves in the space, outperforming other indices and bitcoin included. All of this has pointed to an altcoin season after a so-called ‘crypto winter’ and the gains recorded so far in February are further proof of this.
Small cap index takes the lead
The entire cryptocurrency market had suffered from the downtrend that began in December. However, the second week of February saw a respite with double-digit gains in bitcoin and all indices. Small-, mid-, and large-cap indices have all posted gains so far, but small-caps have taken the lead, showing more bullish momentum in smaller-cap altcoins.
Related Reading | Bitcoin Stabilizes Above $45k, US Inflation Hits 7.5% Year Over Year
Just two weeks into February, the small-cap index has seen gains of up to 19%. This is a huge leap forward for the index after it closed January as the worst performing index, seeing accelerating losses compared to its counterparts. The tables have now turned as the small-cap index’s gains have been 4% higher than everyone else’s.
Small Cap Index Returns Biggest Gains | Source: Arcane Research
Bitcoin, the mid-cap index and the large-cap index posted double-digit gains in January. Most of the gains recorded were from a single week in which prices surged across the cryptocurrency market.
What about Bitcoin?
Without a doubt, Bitcoin has also generated impressive profits for its investors in the same period of time. It may not be as high as the small-cap index, but it is still one of the biggest gainers in the space. Follow the movement of market sentiment from extreme negativity to positive. The recovery of the momentum has also helped in this case.
Related Reading | JPMorgan puts Bitcoin at $150,000 long-term, but what about its ‘fair value’?
The digital asset is now trading above its 20-day moving average but remains below the 50-day moving average. At its current point, the next resistance to break for the asset lies at $45,240. However, a break above a second resistance point at $46.712 is what will really solidify your entry into another bearish rally. Until then, it is likely to continue to range between $43,000 and $44,000.
BTC starts another recovery trend | Source: BTCUSD on TradingView.com
On the support side, bitcoin’s break below $43,000 will see its next support at $42,790. Not a far point, but if it doesn’t hold then another drop to $40,000 may be imminent.
However, the digital asset has shown strong selling signals around the 50 and 100-day moving averages. Unless buyers make significant strides to support bitcoin’s price, bears are more likely to take control, leading bitcoin into another prolonged downtrend.
Featured Image from Forbes, Charts from Arcane Research, and TradingView.com
This post Small Cap Index Earns February Gains, But What Is Bitcoin Doing?
was published first on https://www.newsbtc.com/news/bitcoin/small-cap-index-lead-gains-in-february-but-what-is-bitcoin-doing/