The VeChain price is bouncing back as investors rush to buy the dips. VET is trading at $0.1145, which is 72% above the weekend’s low of $0.0665. Its market capitalization has bounced back to more than $7.1 billion, making it the 20th digital currency in the world. Other cryptocurrencies like Bitcoin, Ethereum, and Binance Coin have also surged. According to CoinMarketCap, the total market capitalization of all currencies has jumped by more than 7%.
What is VeChain?
VeChain is a blockchain project that was started in 2015. The network is similar to Ethereum, with the only difference being that it targets corporations. Today, several large companies in China have embraced the technology and are currently building decentralized applications. Some of the best-known companies that are using VeChain’s Thor platform are Walmart and BMW.
In the past few months, VeChain has gained a lot of popularity among developers and investors. Developers love its proof-of-stake consensus that is known for its efficiency and ease of use. It also uses proof-of-authority, committee-endorsing mechanism, and block finality mechanism. With all these features, enterprise users are able to build open APIs and applications. Investors have loved it because of its stellar performance. Indeed, at its peak, VeChain price had jumped by more than 2,000% this year.
Like all cryptocurrencies, VeChain price dropped sharply last week. During the weekend, it fell to a low of $0.0643, which was the lowest level since March. This happened as investors grew concerned about interest rates as the US economy made a strong comeback. Inflation has risen to the highest level in 13 years while the number of Americans filing for initial jobless claims has fallen to the lowest level since the pandemic started. As such, there are concerns that the Federal Reserve will respond by hiking interest rates.
Meanwhile, investors are afraid of more regulations from China. This is after the People’s Bank of China warned companies against accepting digital currencies. Authorities also warned that they will start a crackdown on financial companies facilitating the currencies. This was major news because China is the second-biggest economy in the world. It is also a leading player in the crypto space.
VeChain price prediction
In a report I published earlier today, I noted that the VET price would extend its gains by about 32%. This prediction is turning out to be accurate since the coin has jumped by more than 20% since then. In that article, I used the four-hour chart.
Now, looking at the daily chart, we see that the VeChain price has bounced back after it dropped to the 200-day moving average, which provided strong dynamic support. Now, the price is trading between the 100-day and 200-day EMA. It is also below the 50-day EMA.
This means that, despite the bounce, VeChain remains in a bearish trend. The bullish reversal will be confirmed when the price manages to clear the 100-day and 50-day dynamic resistance. If this happens, it will mean that there is enough buying power to push it to its year-to-date high.