The world’s dominant cryptocurrency’s market capitalization hit $889 billion on Tuesday. It pushed Bitcoin above the value of Tesla.
The current rally is longer limited to the dominant cryptocurrency as several altcoins have been boosting in the last few days. This reveals that the buying interest is broad-based. Today the total crypto market capitalization was over $1.4 trillion.
Another essential thing to mention is that the positive news flow and price increase in most cryptocurrencies may make traders think that the bull run will continue in the long-term. However, traders should be concerned because every bull phase sees periodic corrections.
Moreover, every bull phase usually has a various set of leaders. The altcoins that have performed remarkably well in the current bull run may not lead the next one. Therefore, traders should analyze their portfolio and close the positions that may not be fundamentally strong but could have grown only due to positive sentiment.
Significantly, after the sharp rally on February 8, the world’s largest cryptocurrency Bitcoin, formed a Doji candlestick pattern, which means the bulls and bears were uncertain about the next move. The uncertainty has resolved to the downside today, indicating profit-booking by traders.
If Bitcoin breaks below $41,959.63, it means traders are booking profit aggresively
Furthermore, the BTC/USD pair may now decline to the breakout level at $41,959.63. Suppose the value rebounds off this support. In that case, it will imply that the sentiment is bullish and traders are not waiting for a deeper correction to purchase.
If the bulls can lift the price above $48,152.84, the uptrend may continue, with the next target objective at $60,974.43.
In comparison, if the pair breaks and holds below $41,959.63, it will suggest that traders are booking profits aggressively.
A break below the moving averages will be the first indication that supply surpasses demand. The bears will gain the upper hand if the pair sinks below $28,850.