Altcoins
Is Altseason on the horizon? Analyst issues dire warning calling for trend reversal
A question on everyone’s mind right now is whether altcoins will recover and trend upward in the coming days. Crypto Wolves Analyst says that Bitcoin has recently faced resistance, leading to a 5-6% decline. Although this drop is notable, it is not huge. However, altcoins were hit much harder. Over the past week, Bitcoin has gained 2%, but most of the top 100 altcoins have seen significant declines, many by double digits, with declines ranging from 10% to 21%.
Ethereum, which dominates the altcoin market, fell 6-7% during the same period. This is slightly more than Bitcoin’s decline and reflects the broader trend of altcoin underperformance. The overall market capitalization of the altcoin, excluding Bitcoin And Ethereumfell 10%, showing a more severe impact on altcoins.
The analyst pointed out that Ethereum falling below a key support level since May 21 makes altcoins more vulnerable to further declines if Bitcoin continues to fall. To regain bullish momentum, the market must reverse its current trend
He explained that if the market follows typical patterns, altcoins should start rising soon. It showed that the altcoin market cap chart follows a similar five-stage pattern as in the past: bottoming out, rebounding, consolidating, and then reaching new all-time highs.
The analyst also noted that when Bitcoin dominance falls, it usually signals the start of an altcoin season. Historically, this occurs after the fourth stage of consolidation. If this trend continues, we should soon expect an altcoin season and a parabolic bull market for altcoins. This trend was also seen in 2017, suggesting it could happen again.
Furthermore, he discussed the invalidation points of current market trends. He noted that if Bitcoin fell below $66.8k it would be a bad sign, but a fall below $61k would be a major indication that the trend is broken. For the altcoin market, a weekly candle close to the bull market support band on the total cryptocurrency market cap chart would be the first sign of invalidation. If these levels are breached, it suggests that the current uptrend is over.
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