Why has Stacks Token Price rallied more than 130% in the past week?

Key takeaways:

• Bitcoin-based platform, Stacks, which allows the creation of smart contracts, DeFi, and other things on top of Bitcoin has been in the news for the past two weeks.
• It has rallied over 130% in the past week and nearly 300% since the beginning of the year.
• Technical indications for the token show strong upside potential of up to 100% in the near future!

Stacks, a little-known crypto project has grown to prominence in recent months and especially so in the last two weeks, as it has more than doubled its value in that timeframe. But why has this token seen such a huge rally? To understand that – let’s get a little bit of context for the same.

Stacks, which was earlier called Blockstack, is an open-source platform that enables smart contract capability, DeFi, NFTs, and other dApps for the Bitcoin blockchain network. Stacks blockchain is a ‘layer’ for Bitcoin similar to the Lightening Network. Apart from simply enabling smart contract capabilities, Stacks also provides open-source software for authentication and even data storage.

As of late, this has been a trend that has been picking up in the crypto space, where people want to build decentralized finance products and services on top of Bitcoin instead of other platforms, which are more prone to hacks and compromises on the chain. Bitcoin in that regard, despite being an age-old tech in the crypto world has withstood the storms several times over. Several major projects have come and gone but Bitcoin has been standing tall and has stood the test of time!

Learn how to create #Bitcoin secured smart contracts 👇 https://t.co/ATmEDWvCl8

— stacks.btc (@Stacks) February 23, 2023

STACKS TECHNICAL OVERVIEW

STX/USD | Source: TradingView

• STX price had been gaining ever since the beginning of 2023 but has gained the most in the past two weeks – going from sub $0.4 levels to near $0.8, practically doubling its value.
• Thanks to this major rally, it is up nearly 300% or 4 times since the beginning of the new year and has strong follow-through rally potential.
• In the past month and a half, STX price has broken out of several resistance levels, from the diagonal trendline resistance to the 50 and 200-day moving averages, and has managed to remain strongly above them.
• In fact, STX price has also seen the golden crossover of the 50 and 200-day moving averages, which would serve as a strong bullish indicator going forward too.
• However, while all indications point toward the upside, the Relative Strength Index is at an overbought situation of 81 at the time of writing and thus STX price could see some price correction to cool down post the incredible rally.
• Thanks to this major rally, Stacks’ total market capitalization has skyrocketed to $1.14 billion as of writing!
• STX price is well-positioned to continue its rally upwards up to $1.5 level, which is nearly 100% up current levels becoming a very attractive opportunity for traders and medium-term investors.

Read more: Top Altcoins 2023

STACKS ON-CHAIN ANALYSIS

STX SOCIAL DOMINANCE IS AT A NEW HIGH!

STX Social Dominance | Source: Santiment

Amid the incredible rally that the STX token has been able to achieve in such a short span of time, its social dominance has also gone up significantly. Essentially Social Dominance is a crypto metric that shows the percentage share of the discussions in crypto media that is referring to a particular asset or phrase related to that asset. The metric is built on top of the Social Data and it is calculated by comparing the Social Volume of that asset to the combined social volume of the 100 largest assets by market capitalization. Thus, this is a very good indication of how much social clout a particular project may be garnering online, and points to rising interest in the token.

TOTAL WEIGHTED SENTIMENT FOR STX IS STRONGLY IN THE POSITIVE ZONE!

STX Weighted Sentiment | Source: Santiment

A weighted sentiment is another social metric of a crypto asset that works on top of the sentiment balance metric and takes into account the unique social volume. It is calculated in such a way that this metric will spike when the social volume for a particular social volume is really high and a vast majority of the messages in that spike also happen to be positive at the same time. On the other hand, dips in this metric will occur when the social volume for an asset is high, but the overall sentiment for it is on the negative side. Similarly, if there are lower volumes, meaning that the asset isn’t talked about much, the metric will hover around the zero line without too many jumps or dips.

Thus, from the chart above, we can observe how Stacks’ native crypto token, STX has garnered a lot of positive social clout, especially since the beginning of February, when it has seen the strongest spike and has managed to stay above zero line for most of the month. Hence, it seems the overall sentiment regarding the token is pretty positive.

Conclusion

Thus, in conclusion, STX is well-positioned to continue its rally all the way up to $1.5, which is the next major resistance level for the token. As mentioned earlier, that happens to be a near 100% rally from current levels, and with positive social metrics and fundamentals – it becomes a very good candidate for crypto investors to keep an eye out for.

Values as on 24 February 2023.

Additional Read: Bitcoin Price Prediction