May’s brutal collapse managed to nullify the bullish narrative of the broader crypto market. Exceptions like Solana aside, most altcoins have yet to make a full recovery. However, some alts have been doing better than the rest lately, and Ethereum Classic is definitely one of them.
On the first day of this year, ETC was trading at $ 5.5. However, its valuation has risen 14 times since then, with crypto trading at $ 70, at the time of writing.
The question, ergo, is: is it too good to last?
Taken together, a number of factors have sustained the alt rally. For starters, ETC’s trading volume has been hitting random spikes lately. Now, if the April to May phase were excluded, the current level ($ 4 to $ 5.5 billion) would essentially be the peak.
ETC’s circulating market capitalization too, for that matter, has risen from $ 5.39 billion to $ 8.29 billion in just one month. This is a sign that there are more tokens publicly available at this stage and that they are circulating in the market.
Also, like Ethereum, even new ETC issuance has almost doubled (from $ 0.81 to $ 1.42 million) over the last month. Whenever scheduled tokens have been issued in the past, the price of ETC has always increased. The same has been able to successfully sustain the alt rally this time.
Are there reasons for concern?
Ethereum Classic’s market cap dominance remains stagnant. In fact, it has been hovering at the 0.4% support for more than a month. The count of active addresses has also been gradually decreasing.
On July 21, the count for this metric was 41.9k. At the time of writing, however, it was worth just 35.9k. The most active addresses generally mean that more people are using crypto, or at least buying it. Since ETC has witnessed the opposite lately, it can be said that the state of the network has been deteriorating.
The correlation of ETC with ETH also noticed a change in trend. The price of ETH recorded a negligible increase of 0.09% in the last 24 hours, while it was up only 2.4% in the last 7 days. In contrast, the price of ETC declined 3.12% and rose 19% during the aforementioned time periods, respectively.
It would be fair to say that ETC has been able to decouple from ETH. What’s more, the ETC price has also been independently recovering and correcting to some extent.
So what can you expect in the next few days?
Ethereum Classic price is at an interesting juncture. The altcoin had been trying to break above its $ 63.64 resistance level for quite some time. However, it did so successfully on August 14, with ETC well above that level since then.
Given the healthy state of the altcoin’s volume, the odds that the ETC trend will continue in the same direction are good. In fact, at press time, it was seen to be heading towards the $ 83.6 level. Nonetheless, if volumes decline or the broader market does not support its rally, the altcoin can be expected to dip back into the $ 48- $ 56 range.
This is a machine translation of our English version.
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