After Ripping Past $3, Analysts Think Tezos (XTZ) Has Room to Rally
Like Chainlink and other altcoins, Tezos (XTZ) has done extremely well over recent days despite the weekend’s flash crash. On Tuesday, the popular cryptocurrency was up more than 9% on the day at one point, holding above the critical $3.00 level.
Analysts say that the asset is primed to head even higher in the days ahead despite uncertainty around the Bitcoin price.
At its current price of $3.20, the asset is nearly trading at highs not seen near the top of the February blow-off top for the cryptocurrency market.
Related Reading: Crypto Tidbits: Ethereum Surges 20%, US Banks Can Hold BTC, DeFi Still in Vogue
Tezos Could Soon Rally Even Further: Analysts
Analysts expect Tezos to rally even further in the weeks ahead, citing technicals and the fundamentals of the cryptocurrency.
One trader shared the chart below on August 4th, noting that XTZ’s recent price action has allowed it to firmly flip the ~$3.13 horizontal into support. The asset’s recent rally has also pushed it above the upper bound of a downward channel, supporting upside.
Chart of XTZ's recent price action with analysis by trader "Steve" (@Thetradingtramp on Twitter). Chart from TradingView.com
This optimism was echoed by another analyst, who said that Tezos closing above $3.22 on its daily chart would lead to “pretty significant expansion upward.” This sentiment was predicated on how $3.22 has acted as a crucial level of resistance for the altcoin over recent weeks.
Is It Really Time For Altcoins to Outperform?
Although the technicals may support an XTZ rally, some are starting to expect more Bitcoin volatility. Such volatility could suppress altcoins and their potential to rally.
Santiment, a blockchain analytics firm, wrote on the potential for imminent Bitcoin volatility:
“$BTC has just indicated that the 3rd largest token age consumed spike since April has taken place today, indicating a potential short/mid-term price direction change and increased volatility… More likely to the upside than down, because this indicator more often than not foreshadows short-term to mid-term price reversals.”
1) $BTC has just indicated that the 3rd largest token age consumed spike since April has taken place today, indicating a potential short/mid-term price direction change and increased volatility. The last large spike, occurring on July 27th, was indicative pic.twitter.com/9k0cIyeBOM
— Santiment (@santimentfeed) August 4, 2020
Mohit Sorout, a founding partner of Bitazu Capital, suggested that an increase in altcoin volatility may decrease the incentive for traders to invest in altcoins:
Most (altcoin) cycles in crypto are centered around bitcoin volatility. When it dries up, no one wants to trade BTC which becomes evident from the volume as well. This leads to a large uptick in speculation on alts, driving their prices up – typically alts with strong narratives & large scale memetic behavior get the most volumes.
This has been echoed by other commentators, who say that in times when Bitcoin is trending, it is unwise to speculate on altcoins.
Related Reading: Unexpected Factor That Suppressed BTC Bulls in 2019 Is Now Gone
Featured Image from Shutterstock Price tags: xtzusd, xtzbtc Charts from TradingView.com After Ripping Past $3, Analysts Think Tezos (XTZ) Has Room to Rally
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Nick Chong, Khareem Sudlow
