Compared to the cryptocurrency market, the artificial intelligence (AI) sector within this space remains relatively small in past market cycles, but it shows immense growth potential. Analyst Miles Deutscher reports that the market capitalization of AI tokens is nearly nine times smaller than the peak during the 2021 “SOLUNAVAX” cycle.
A recent chart from Messari indicates that following Bitcoin’s lead, other cryptocurrencies in the industry often experience parabolic price movements. If this historical trend repeats, AI tokens may further expand as Bitcoin continues its bullish trajectory.
AI Tokens Lag Behind Historical Peaks
The AI Index shows that while growth has been significant, its market capitalization is still far below previous altcoin cycles. The “SOLUNAVAX” assets, including Solana (SOL), Luna (LUNA), and Avalanche (AVAX), reached peak market capitalizations in 2021 that greatly surpassed today’s AI sector.
Memecoins have also seen a resurgence, but they still lag behind previous altcoin cycles. This pattern suggests that AI tokens may continue their upward trend, especially if Bitcoin maintains its positive momentum into 2025.
Whale Transactions and Bitcoin’s Resistance Levels
Large Bitcoin transactions indicate an increase in institutional activity. Whale Alert data revealed a transfer of 10,557 BTC (valued at approximately $1.04 billion) from an unknown wallet to Coinbase Institutional. This trend underscores the growing interest among major investors as Bitcoin fluctuates near key price levels.
According to analyst Rekt Capital, Bitcoin has rebounded from its lows and surged within the $91,000 to $101,000 range. However, it faces rejection at the upper end of this range, encountering resistance at new low levels. This indicates that Bitcoin’s next price movement will depend on its ability to break through these critical resistance points.
Current Price Trend and Volatility of Bitcoin
According to CoinMarketCap, Bitcoin’s price is $100,960, reflecting a daily increase of 1.40%. Earlier in the day, it had touched the $100,000 level before pulling back. The price briefly dipped below $98,000 before recovering, indicating that buyers remain active at lower levels.
Related: $100,000 Bitcoin: How Policies and Markets Shape Bitcoin’s Future
Bitcoin faces psychological resistance at the $100,000 mark and has struggled to maintain its upward momentum. The next resistance level is at $100,500, marking the highest level before a significant pullback. Meanwhile, support remains stable at $98,000, with additional support levels at $97,500 and $96,800. Falling below these points could lead to further declines.
Market Sentiment and Indicators
Bitcoin’s market capitalization has now exceeded $2 trillion, reflecting strong investor confidence. However, trading volume has decreased by 4.68%, indicating reduced market activity. The Relative Strength Index (RSI) stands at 55.90, suggesting a neutral market condition. A reading above 60 may confirm bullish momentum, while a reading below 50 could indicate bearish pressure.
The Moving Average Convergence Divergence (MACD) indicator currently shows bearish divergence, with the histogram in negative territory. If the MACD line crosses above the signal line, a bullish reversal may occur.