🔥Early Access: Land A High Paying Web3 Job In 90 Days LEARN MORE

Crypto traders eye explosive rally as altcoin market revives

In this post:

  • Crypto markets are in the “disbelief” stage, traditionally followed by a sharp rally.
  • Altcoin market cap has dropped by 17.55% to $264.9 billion, still holding above the crucial $250 billion support.
  • Traders are focusing on three indicators: the 20-day EMA, stochastic RSI, and Bitcoin dominance to forecast potential rallies.

Crypto markets are in a stage called “disbelief,” where skepticism prevails despite bullish indicators. Traders, eyeing an imminent rally, are closely monitoring three tech indicators that could signal a significant uptick in the altcoin sector.

Signs of a Surge Amid Skepticism

Crypto analyst Mikybull Crypto recently alerted their followers on X that the altcoin market’s capitalization is currently at the disbelief stage, which is typically followed by an explosive rally. Despite the overall market cap of altcoins, excluding the top ten, experiencing a 17.55% decline over the last 30 days to $264.9 billion, there’s still strong support above the $250 billion mark. This level is crucial as it suggests altcoins are gearing up for a potential upswing.

According to the Crypto Fear and Greed Index, there has been a notable drop of 24 index points in the past month, with the “Greed” score now sitting at 56. This drop further highlights the current market skepticism that defines the disbelief stage. Meanwhile, Rekt Capital, another prominent voice in the crypto space, highlighted to their 465,300 X followers that despite recent downturns, the market is positioning itself for a future upward trajectory.

Key Indicators to Watch

Traders are keeping tabs on a trio of indicators across the broader crypto market that includes the 20-day exponential moving average (EMA), the stochastic relative strength index (RSI), and Bitcoin dominance. The EMA provides a weighted average of prices over the period, with more emphasis on recent data, serving as a critical metric for market direction.

See also  Tether investigation FUD wipes out $1B in open interest with latest market flash crash

Pseudonymous crypto trader Titan of Crypto noted that if the total crypto market cap retests the EMA20 and simultaneously achieves a bullish cross on the stochastic RSI, it could usher in rally time. These indicators are essential for predicting the altcoin market’s movement and are closely watched by market participants.

Furthermore, Bitcoin’s market share, known as Bitcoin dominance, is another vital indicator. Currently, at 54.7%, having decreased by 0.56% over the past week, a continued fall in Bitcoin dominance could signal the start of an ‘altseason,’ where altcoins could perform exceptionally well compared to Bitcoin.

Future Prospects and Market Cycles

Historically, altcoins tend to find their local price bottoms before making significant rallies. Popular crypto analyst Rekt Capital suggested that altcoins are on track to find their local bottom around early June, based on past market cycles. This potential bottoming could set the stage for the next altcoin bull cycle.

However, for altcoins to truly outperform, several conditions need to be met. Aurelie Barthere, principal research analyst at Nansen, explained that the sentiment in the crypto market since mid-March has been subdued. For altcoins to thrive, Bitcoin’s price needs to break out decisively above the 20-day EMA, which would reduce the volatility in altcoin prices and foster a more bullish environment.

See also  Prosecutors praise Nishad Singh for key role in FTX investigation

Despite the recent challenges, the altcoin market cap remains up over 24% year-to-date and an impressive 167% over the past year. This resilience suggests that while the market is in a consolidation phase, it is also preparing for potential new highs in the future.

Analysts have pointed out that a bull flag is forming on Bitcoin’s charts, indicating that we might see new all-time highs later in 2024. This setup is crucial as altcoin sentiment is tightly linked to Bitcoin’s price movements.

Share link:

DisclaimerThe information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

Editor's choice

Loading Editor's Choice articles...

Stay on top of crypto news, get daily updates in your inbox

Most read

Loading Most Read articles...
Cryptopolitan
Subscribe to CryptoPolitan