Holochain (HOT) Price Analysis: Waiting For a Market-Wide Bull Run Spark

Holochain is up 5.4% in USD on the week and also up 6.4% on BTC in the same time-frame.

It is currently worth only 9 satoshis, a huge drop from its most yearl high from January when HOT was worth 41 satoshis.

The chart looks bleak. As you will read below, trading volume is very thin, liquidity is problematic and there is not much valuable info a trader can read out of Holochain charts. However, when we look at the total market cap charts and charts of some other coins, we do look poised for a nice bull run that only needs a spark to trigger it. As for HOT, it is patiently waiting for that external spark since it lacks power to move on its own.

It is currently floating around confluence point of two moving averages but a significant move up can be expected only if the whole market does some spectacular and idiosyncratic rocket launches. In that case, Holochain would first need to break through the resistances at 13 and 19 sats before even thinking of reaching the above mentioned yearly highs.

There are some traders that expect HOT to be one of the altcoins that will lead the highly yearned for altcoin season.

Trading volume and buy support

Trading volume is extremely tiny – reported volume in the last 24hrs is $500k and “Real 10” (trading volume on the exchanges that provably prevent wash trading) volume is non-existant. This means that Holochain has serious liquidity issues which indicates that a lot of the alleged interest in HOT is manufactured and not organic.


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Moreover, HOT comparatively has a solid buy support, according to coinmarketbook.cc. Buy support is measuring sum of buy orders at 10% distance from the highest bid price. This way we can eliminate fake buy walls and whale manipulation and see the real interest of the market in a certain coin. HOT currently has a decent $1.6m of buy orders measured with this method, which sets HOT buy support/market cap ratio at 1.39%, an above average value. Bitcoin and Ethereum have a 0.20% and 0.28% ratios, respectively. This novel metric indicates there are a lot of manipulations, inflated liquidity and fake orders on all crypto trading pairs, including HOT pairs.

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Social Metrics

Holochain’s sentiment score, measured by the market analytics firm Omenics, paints a neutral picture.

Omenics wraps its analysis up into a single simple indicator known as the SentScore, which is formed from the combination of five different verticals:

  1. News
  2. Social Media
  3. Buzz
  4. Technical Analysis
  5. Fundamentals

Interpreting the SentScore’s scale:

  • 0 to 2.5: very negative
  • 2.5 to 4.0: somewhat negative zone
  • 4.0 to 6.0: neutral zone
  • 6.0 to 7.5: somewhat positive zone
  • 7.5 to 10: very positive

Holochain’s currently has a Sentscore of 3.3, a significant drop from the 5.2 it had back on September 5th. Overall, HOLO lost social media buzz around it across all platforms – Twitter, Reddit but also search volume are all moderately down right now in comparison to the beginning of September.

Fundamentals

To assess fundamental health of a project, we used the FCAS metric. FCAS is a comparative metric whose score is derived from the interactivity between primary project lifecycle fundamentals: User Activity, Developer Behavior, and Market Maturity.

There are a few sub components which provide data to each fundamental:

User Activity is comprised of Project Utilization and Network Activity

Developer Behavior is comprised of Code Changes, Code Improvement and Community Involvement

Market Maturity is comprised of Liquidity and Market Risk. Market Maturity has less than 5% impact on a project’s overall FCAS.

FCAS ratings are on a 0-1000 point scale with a corresponding letter grade. Break points are based on standard deviations in the underlying component distributions.

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900 – 1000 is marked as S for superb. 750 – 899 is marked as A for attractive. 650 – 749 is marked as B for basic. 500 – 649 is marked as C for caution. And finally, below 500 is marked as fragile. You can read more about it here.

Holochain has been ranked as the A category – attractive with overall 766 points as of October 7th. The strongest metric that contributed to this score is developer activity that got 930 points, followed by market maturity that had 631 points. This data backed fundamentals valuation model is a good insight into underlying driving forces of a project and as you can see Holochain fares excellent under the scrutiny of FCAS.

 

CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com

Felix Kuester works as an analyst and content manager for Captainaltcoin and specializes in chart analysis and blockchain technology. He is also actively involved in the crypto community - both online as a central contact in the Facebook and Telegram channel of Captainaltcoin and offline as an interviewer he always maintains an ongoing interaction with startups, developers and visionaries. The physicist has couple of years of professional experience as project manager and technological consultant. Felix has for many years been enthusiastic not only about the technological dimension of crypto currencies, but also about the socio-economic vision behind them.

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