Loopring (LRC) - How are things looking now
Assets covered: Loopring (LRC)
Metrics used: Price, MVRV 7D, Supply on Exchanges, Daily Active Addresses, Network Growth, Social Volume
After a massive rally that saw a blow off top in early November, Loopring appears to have found a local bottom for now. Let's take a quick look at how things are.
Ever since LRC topped out in early November, it's been following BTC's price action for the most part, which suggests that LRC itself has very little strength.
Now that BTC's stablizing, and attempting a reversal back into the uptrend, we are also seeing LRC do the same. It's currently hitting the resistance trendline and a strong breakout would bode well for it.
Ideally, we would like to see a breakout with strong volume and a successful retest of the resistance trendline.
As long as BTC does not go on a massive dump, and continues to range, ALTs like LRC are likely to benefit from such "boring" BTC price action.
Supply on Exchanges
Once the blow off top happened in early November, sellers have been using each rally to deposit and dump their token it seems.
However, this started to slowdown once December came, a price rally didn't see a strong spike in Supply on Exchanges, which may suggest that spot sellers are getting exhausted.
Indeed, we do observe new spikes coming in from 18th December onwards, but are they spot sellers looking to crash the current price?
The price action is suggesting it could be market making or someone preparing for a big move to the upside (to dump during then).
LRC's MVRV 7D which measures the short-term profit/loss of holders is showing that we are almost approaching the danger zone. There could be some room for the price to grow but once it enters the dangerzone, we would be more cautious on the price outlook as short-term holders are well in the profit at then - Which could incentivise them to take some profits.
We are seeing a new spike in Network growth after a month of decline, could this be the next wave of entrants?
Daily Active Addresses (DAA)
LRC's Daily Active Addresses remains rather healthy looking, network is still very much active regardless of the price action in the past month. Good sign so far with this new spike in DAA.
We are starting to see new interest in Loopring as LRC mentions start to spike with the recent price rally. We should be seeing a higher spike if price manages to breakout from the trendline resistance. However, if the spike in DAA is lesser than prior, it could signal a local top.