XDC surge to 3-year high, more gains ahead?

XDC, the native token of the Layer 1 blockchain, rose to a 39-month high on January 15 after breaking a key resistance level supported by a new partnership.

XDC Network (XDC) rose 22% to $0.1231 in the past day, making it the biggest gainer among the top 100 crypto assets, according to data from CoinGecko. The market value was over $1.7 billion at the time of writing.

The altcoin price increase was accompanied by an increase in trading volume and open positions in the futures market. Notably, the asset’s trading volume increased by 44% in the past day to over $84 million, while its open interest doubled to $4.62 million in the same time period.

XDC was assembled after the project announced its partnership with account abstraction platform PillarX, which will integrate XDC into its ecosystem. This will allow platform users to incorporate XDC into their Web3 events while benefiting from advanced features such as improved transaction efficiency and usability.

The partnership will also strengthen XDC Network’s place in the RWA tokenization market by increasing its accessibility and utility for tokenizing real-world assets through seamless Web3 integration. RWA tokenization allows users to convert physical assets, such as real estate, into digital tokens that can be traded on blockchain networks.

XDC Network had previously partnered with Archax, a digital securities exchange and custodian regulated by the Financial Conduct Authority, to encourage the adoption of tokenized real-world assets. The project therefore has the second largest position in the RWA market, behind Mantra, which has a market capitalization of over $3.6 billion.

Another factor that renewed investors’ confidence in the project was the growth of the XDC Network DeFi ecosystem in recent months. According to DefiLlama, its total value locked in the DeFi ecosystem has increased from $8.5 million at the beginning of November to an all-time high of $31.23 million as seen on January 15.

Additionally, the altcoin’s rally was partially supported by Bitcoin’s march towards $100,000 as the broader crypto market rebounded following cooler-than-expected inflation data from the Bureau of Labor Statistics. The Crypto Fear and Greed Index has also returned to “Greed” from the neutral levels seen last week; The value of 70 at the time the news was published indicates that the risk appetite in the market has increased.

XDC price action XDC price, MACD and Supertrend chart | Source: crypto.news

The Moving Average Convergence Divergence indicator on the 1-day XDC/USDT chart shows that the rally may continue with both the MACD and the signal line pointing upwards. This is confirmed by the Supertrend indicator and the Supertrend line moves below the line to support the bullish view.

XDC 50-day and 200-day EMA chart | Source: crypto.news

The altcoin is also trading above the 50-day and 200-day Moving Averages; This means buying pressure is still high with the bulls targeting higher prices, potentially targeting an all-time high of $0.19, which is around 39% higher than the current price. $0.1131.

However, the XDC rally may face a pullback before resuming its rally as its price approaches the upper Bollinger Band and the Relative Strength Index approaches overbought levels.

Another potential factor that may prevent the continuation of the rise is the increased sales activities observed among retail traders. Last day, XDC investors moved tokens worth $ 3.06 million to the exchanges, while $ 2.57 million was withdrawn, according to CoinGlass data.

Increasing amounts of cryptocurrency being sent to exchanges is often a sign that investors are preparing to sell their holdings to make a profit or convert the funds into a different asset.