Exchange’s utility token is not stopping despite massive price rally we saw two days ago
As soon as the famous exchange acquired Justin Sun as an adviser to focus on bringing more value to Houbi Token, investors started to push their funds toward the exchange’s utility token as its value is on the rise for the third day in a row.
A 60% rally
On the day that the announcement was made, the token almost immediately spiked in value by more than 25%, bringing a lot of attention to the exchange and the token used by it. However, volume profiles and inflow data suggested that the rally was purely speculative and investors were simply trying to catch a quick profit.
However, a correction after a massive price increase was not as significant as it usually is after assets face a massive wave of new inflows, and the value of HT has only decreased by 1.3%. The next day, HT token saw an enormous 30% increase in less than 10 hours.
Unfortunately, it is not clear what became the fuel for yet another growth cycle, but its nature completely replicates the behavior of investors on Oct. 10, which is why market manipulation could be part of the strong growth we saw.
The token broke through at the important resistance level of $5.9, and the most likely scenario now would be short or midterm consolidation ahead of the continuation of the movement.
It is not yet clear what Justin Sun will bring to the table to make HT more interesting for investors, but the possibility of intrinsic growth might become long-term fuel for the asset.
Ethereum is at the bottom, again
As we mentioned in our previous market review, Ethereum will most likely be moving in a prolonged consolidation channel in the foreseeable future. However, the asset will bounce from a lower to upper border of the channel, making scalping a viable trading strategy in a rangebound market.
Today, ETH is trading at $1,298 — the lower price range of the consolidation channel. The last time the second biggest cryptocurrency on the market reached that value, we saw a bounce to $1,380 shortly after.
Unfortunately, it is unlikely that the market will see a sudden breakthrough from the range bound on Ethereum, considering the existing volume profiles. However, some experts believe in a strong volatility increase because of the rallying of Ethereum open interest.
High volume on a derivatives market in conditions of low volatility is a perfect recipe for an unexpected volatility spike caused by a move on a spot market. Traders are most likely executing various scalping strategies or hedging their spot positions from unexpected drops below the consolidation channel, which will most likely accelerate to yearly lows.
At press time, Ethereum is changing hands at $1,294 and battling to gain a foothold above $1,300.