Here’s why this altcoin’s >50% single-day hike isn’t the whole story

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This isn’t the first time this is hap­pen­ing. With the market’s top assets con­sol­i­dat­ing, the mar­ket has turned its sight to alt­coins offer­ing high­er returns. Revain, for instance, at the time of writ­ing, had hiked by 55% in a sin­gle day. On the con­trary, Bit­coin and Ethereum were up mere­ly 0.18% and 0.53%, respectively. 

Trad­ing at $0.01099, the #97 ranked asset yet again made an attempt to recov­er. Well, from over 75% loss­es since the May 2021 price high of $0.06229. Notably, the asset’s pre­vi­ous attempts to ral­ly through­out Decem­ber were met with sub­se­quent losses. 

How­ev­er, on 13 Decem­ber, REV saw around 112% gains. Alas, its price start­ed falling the very next day, revers­ing the uptick. Then again on 20 Decem­ber, the crypto-asset’s price appre­ci­at­ed by 45%, but it failed to hold the price for long.

Like­wise, on 1 Jan­u­ary, the asset had risen by over 50% at press time. This uptick was met with skep­ti­cism owing to the alt’s fall in the past after major price hikes. So, the ques­tion is – What is dif­fer­ent this time (if at all)? 

A long-term reversal in play?

Sin­gle-day price upticks mov­ing the mar­ket in the right direc­tion are gen­er­al­ly loved by mar­ket par­tic­i­pants. How­ev­er, the recent 18% gains for Revain were dif­fer­ent. What the alt­coin needs is a sus­tained ral­ly before the mar­ket could tru­ly be hap­py about REV’s gains. 

Since Sep­tem­ber, the alt­coin has made low­er lows with occa­sion­al one-day price surges. Dur­ing the end of Novem­ber, the alt­coin saw major sell-offs. The price action hasn’t been pleas­ant since then. 

Nonethe­less, 2022 could be dif­fer­ent, with the coin’s MVRV hav­ing some inter­est­ing insights. Notably, REV’s MVRV 7‑day and MVRV 90-day not­ed a rever­sal, both of which could play out well if prices hold. While REV wasn’t too under­val­ued at press time, with its MVRV still tread­ing the neg­a­tive ter­ri­to­ry, a rever­sal into the pos­i­tive zone is what REV would need going forward. 

Source: San­base

That being said, the MVRV 365-day is still on a long-drawn down­trend after its 4 Sep­tem­ber mul­ti-month high. If the long-term MVRV breaks away from the down­trend, a rever­sal could be fur­ther confirmed. 

Fur­ther­more, the alt’s Sharpe ratio, which made the asset rel­a­tive­ly unsafe as an invest­ment a week ago, seemed to recov­er. In fact, it was back in the pos­i­tive zone. The Sharpe ratio recu­per­at­ed by over 300% in the last week, a fig­ure that made the asset rel­a­tive­ly safer. 

But, here’s the catch

With the asset’s price gain­ing momen­tum, the coin’s active address­es have picked up too as trade vol­umes spiked. How­ev­er, with net­work growth still lag­ging behind, the lat­est price uptick can­not be called a true recovery. 

Source: San­base

A sus­tained uptrend of active address­es, as seen in August, along­side a rever­sal in net­work growth, could con­firm the rever­sal. For now, how­ev­er, with close to 8.24 mil­lion age con­sumed on 1 Jan­u­ary, the same meant that a bunch of long-time hold­ers sold their REV for prof­it at that price. 

There­fore, it seems like a recov­ery of the long-term indi­ca­tors with sus­tained activ­i­ty could aid REV’s recov­ery. Until then, the pos­si­bil­i­ty of a fall post the gains can’t be disregarded. 

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