Investors are interested again in the crypto market, as Bitcoin broke above the pivotal $10,000 level. Suddenly, other cryptocurrencies caught a bid tone, with Ripple price breaking higher after a falling wedge pattern.
While Bitcoin is the preferred cryptocurrency for many investors, some diversify within the class. For this reason, other cryptocurrencies trade in a direct correlation with Bitcoin.
However, in some cases, such as Ethereum, smaller cryptocurrencies when compared with their market capitalization, outperform Bitcoin. This is what the current Ripple price breakout suggests.
Investors Rediscover the Crypto Market
A recent article posted in the Forbes magazine reveals that investors kept pouring in the crypto market. Despite the large consolidation seen on many cryptocurrency pairs, investors kept buying and holding crypto assets since the start of the coronavirus pandemic.
Unsurprisingly, the top ten countries ranked by the number of consumers holding cryptocurrencies is filled with emerging markets. However, there is one exception – the United States.
Emerging markets consumers view crypto as a diversification from the local fiat currency. Historically high inflation led to consumers rising interest towards gold or other assets viewed as a store of value. Crypto is such an asset.
The United States’ presence in the top is surprising to some extent. However, it also reflects the need of US investors to diversify their assets across various classes.
Ripple Price Broke the 2-4 Trendline of a Falling Wedge
Ripple price threatened to break the falling wedge pattern for quite some time now. It recently consolidated below the 2-4 trendline, and just broke higher.
To trade the breakout, bulls must place a stop-loss order at the lows. In such a pattern, the price usually pierces the 1-3 trendline before the breakout – which happened in this case.
Conservative traders may want to wait for Ripple price to break the highs in the 4th wave. Aggressive traders, however, might consider an entry at market. In both cases, the target should be 50% of the falling wedge’s length. That means 0.6.