- Bittensor has become one of the best-performing cryptocurrencies in the market.
- It has surged to a record high of $476, bringing its market cap to over $2.8 billion.
- Technicals point to more upside but a short retreat is possible.
Bittensor (TAO) token price gained momentum this week, becoming one of the best-performing cryptocurrencies in the market. It surged to a record high of $476 on Thursday, giving it a market cap of over $2.8 billion. This surge means that it is now the 33rd biggest cryptocurrency in the world, according to CoinGecko.
Why is TAO price soaring?
Bittensor price has surged at a time when a sea of red has engulfed the crypto market. Bitcoin retreated to $42,000 while other altcoins like Ethereum, Solana, BNB, and Cardano have pulled back sharply from their YTD highs.
The sell-off in cryptocurrencies intensified after the Federal Reserve published a relatively hawkish decision. In it, the bank ruled out against a rate cut in March since inflation remains stubbornly high while the economy is doing modestly well. Inflation rose to 3.4% in December while the economy expanded by 3.3% in the fourth quarter.
The Fed hinted that it will maintain its data-dependence stance this year. As such, most analysts believe that the bank will start cutting rates in June or later in the second half of the year. In most cases, cryptocurrencies like Bittensor tend to do well when the Fed has embraced a risk-on tone.
Bittensor’s rally is also happening at a time when investors are still greedy in the market. The fear and greed index tracked by CNN has moved to the greed zone of 65. However, this is a decline since it crossed the extreme greed zone of 75 earlier this week.
Bittensor price has risen as its on-chain numbers do well. According to its scan website, the number of active accounts in the network has jumped to more than 68.2k. Over 5.25 million TAO tokens have been staked, signaling that there is still demand for the coin.
Most importantly, TAO price has risen because of the ongoing demand for AI, as evidenced by this week’s Microsoft and Google earnings. For starters, Bittensor is a blockchain that aims to make AI features more available to crypto users.
Bittensor price forecast
The daily chart shows that the TAO price has been in a strong uptrend in the past few months. This rally saw it jump above the key resistance point at $395.25, its highest swing on December 14th. By flipping that resistance point, Bittensor invalidated the double-top pattern that had been forming.
The token now remains above the 50-day and 25-day Exponential Moving Averages (EMA) and the Ichimoku cloud. Also, the Average Directional Index (ADX) has risen to almost 40, signaling that the trend is strong. Therefore, the outlook for Bittensor is still bullish but I expect it to retreat and retest the support at $395. This is known as a break and retest pattern.
