An explosive price rally Tuesday pushed the BAND price up by as much as 31 percent.
The oracle token established an intraday high at $4.336 as traders sought safety against a corrective Bitcoin market. Nevertheless, it failed to hold the local top for a long time, leading to a downside correction towards $3.831.
BAND recovery following a massive plunge from its historic high. Source: TradingView.com
The plunge appeared as Bitcoin recovered part of its intraday losses, illustrating an accurate negative correlation with the altcoin. Earlier this month, the BAND’s supersonic price rally from circa $1 to $5.259 had also coincided with Bitcoin’s flat action inside the $9,100-$9,300 range.
The proximity left the leading cryptocurrency as a short-term indicator to measure BAND’s next price moves. It somewhat puts the altcoin under risks of a further bearish correction.
Bitcoin Rally Continuation
Bitcoin jumped above $10,500 earlier this week, a level it had failed to breach for almost a year. Eventually, the cryptocurrency established a year-to-date high just shy of $11,500, also as bids for safe-haven assets rose amid expectations of a new stimulus and the Federal Reserve’s two-day policy meeting on interest rates.
Observers stated that the US central bank would most likely keep its benchmark rates unchanged near zero. If they do, then investors would more likely shift their capital from lower-yield Treasury bonds to riskier assets such as stocks, gold, and even bitcoin.
On the other hand, the US Republicans proposed to inject another $1 trillion into the US economy to aid people and businesses affected by the fresh COVID-induced lockdowns. That also created additional downside pressure on the US dollar, which is already trading near its two-year low.
Bitcoin-BAND is moving in the opposite direction. Source: TradingView.com
The supportive macro fundamentals project Bitcoin as a better asset to hold. But the cryptocurrency’s recent history of falling below $10,000 every time upon a retest prompt traders to keep one foot in the DeFi tokens. That explains the BAND price rally on Tuesday.
What’s Next for BAND
On a YTD timeframe, BAND is still up by more than 1,500 percent. Its daily Relative Strength Indicator yet shows it in a neutral range – which means it has room to grow further.
As usual, profit-taking sentiment, coupled with bullish macro narratives for Bitcoin, may limit the BAND’s price growth. But a correction in the Bitcoin market could wake the BAND bulls, who may attempt a retest towards its all-time high.
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