A bullish inverse head-and-shoulders (H&S) pattern is forming in the market capitalization of altcoins as a whole. “Altcoin” is the abbreviation for “alternative coin” and refers to cryptocurrencies other than bitcoin (BTC).
A prospective pattern completion would indicate “altcoins season” or the outperformance of alternative cryptocurrencies compared to bitcoin and ether (ETH).
Altcoins markets could lead the bull run
Crypto market analysts predict that the altcoins season is about to break out. And, Yes, they have the supporting data to back these predictions. The formation of the inverse head-and-shoulders pattern, one of the most reliable bullish technical analysis patterns on the market, occurs when an asset forms three price troughs, with the middle one being the lowest.
Once prices rise above the trendline (neckline) connecting the peaks between the lows, a breakout or a bearish-to-bullish trend reversal is confirmed. Chartered market technicians calculate the post-breakout price target by adding the pattern’s depth (distance between the head’s low and neckline) to the breakout point.
According to the altcoin’s daily market cap chart, the low of the left shoulder, $188.4 billion, occurred in June 2022, the low of the head, $173.23 billion, took place at the end of December, and the low of the right shoulder, $177.36 billion, occurred in June of this year.
In the past three weeks, the rebound from the right shoulder low has stagnated, with the market cap stabilizing at around $230 billion at press time. The pattern will be complete once the market capitalization surpasses the neckline resistance located near $300 billion.
Top 5 altcoins gainers this week
1. Shiba Inu
Shiba Inu has led the Altcoins market in the last 7 days. The SHIB price has increased since June 10, when it reached a new yearly low of $0.0000054. After a rapid increase, the price reclaimed the $0.0000080 horizontal area on July 28. Six days later, the price moved above the previous long-term symmetrical triangle’s support line.
There are indications that the previous decline was illegitimate, and the prevailing trend is bullish. If the upward trend persists, the price may reach $0.0000113, the triangle’s resistance line. This represents a 12% increase based on the current price of $0.0000010.
Nevertheless, if a decline occurs, the price of SHIB could fall 13% to the triangle’s support line at $0.0000090.
2. THORChain (RUNE)
The price of RUNE has risen since June 14. The price established a higher low on July 30 and subsequently accelerated its rate of increase. The price is currently trading within the horizontal resistance zone at $1.10. This is a crucial region because it has previously provided support. Moreover, it coincides with a long-term descending resistance line that started in February.
If RUNE breaks out of the queue, it could increase by slightly more than 50% and reach $1.70, the next resistance level. However, a 25% decline to the annual lows is the most probable outcome if the proposal is rejected.
3. OKB
Since the beginning of February, the OKB price has moved within a symmetrical triangle. The triangle is regarded as a neutral shape. Nonetheless, the pattern typically results in continuation. Since the triangle occurs after an upward movement, its emergence is the most probable outcome.
If the price breaks out, the most probable outcome will be a 50% increase to the next resistance at $72. The target is determined using the external 1.61 Fibonacci retracement of the most recent downward movement.
This would ultimately result in the altcoin reaching a new all-time high. The current record price is $58.66, which was reached in February 2023.
4. DYDX
Since February, the DYDX price has fallen below a descending resistance line. The most recent rejection of the line occurred on April 28. The resistance line is currently at $2.25, which is marginally above the current price.
If DYDX breaks out, it can rise to the next level of resistance at $3.20, a 45% increase from the current price of roughly $2.16.
However, a 35% decline to the horizontal support area at $1.40 is possible if the price is rejected.
5. Synthetix Network (SNX)
SNX concludes the altcoins gainers this week. Since March 1st, the SNX price has fallen below a descending resistance line. On July 21, this clause resulted in a rejection. This resulted in a decline that reached a low of $2.35 on August 4.
Immediately thereafter, the price regained its footing and reclaimed the $2.50 horizontal area. These deviations are regarded as favorable indicators that frequently precede price increases.
If the price of SNX continues to rise, it will reach the $2.90 resistance level. This represents an increase of 14% relative to the current price.
Nonetheless, if SNX closes below the $2.50 area, a 23% decline to the $2 support area is the most probable price forecast.
