What if the fall was over? – After several months of decline, the cryptocurrency market is encouraging with a return to the upside for most assets. The cryptocurrency market remains highly correlated with the US market which is currently recovering. While the macroeconomics pushes us to remain vigilant, the market appears to be using environmental pessimism to regain some momentum. If the bear market has just started, the joy will be short-lived and those bulls will not be consistent. On the other hand, if Bitcoin has ended its fall, excellent opportunities could arise. To try to find out if this can last, let’s take a look at the clues left by the charts regarding altcoins.
This Ethereum price analysis is offered to you in conjunction with the Coin Trading and its algorithmic trading solution finally accessible to individuals.
Strong Ethereum vs Bitcoin
The founder of Ethereum said so The merger didn’t have a price yet from the market during an interview with Bankless. His protege shows very encouraging signs :
A few months from The Merge, Ethereum re-enter the range against Bitcoin. When a range is replenished, there is a strong probability of returning to the opposite limit level. ETH / BTC is close to the resistence and this level may refuse the course. Also, the course is working on weekly bearish trend line. The course is back bullish thanks to the momentum change made at the support level, but the price remains fragile below the bearish trend line. The price must hold and stay above the trend line for the weekly close on Sunday.
Furthermore, the RSI gave a bullish signal breaking the bearish trend line that began in mid-May 2021. This type of breakout generally gives force to buyers.
The price of ETH / BTC is very positive ahead of The Merge. If the resistance breaks, Ethereum could continue far exceed Bitcoin and carries altcoins with him. This is a much anticipated signal from the actors.
Altcoin’s capitalization approaches weekly resistance
As mentioned in This articlethe capitalization of altcoins had the possibility of rebound at the support level. That’s it, the course is recording 45% get up from the wick left at the level of the support:
The course approaches weekly resistance important and this could slow growth. On a weekly basis, the price has changed momentum, but the price remains fragile. Indeed, the range has been split and the price is below the downtrendline.
As with the ETH / BTC chart, a reintegration of the range would be excellent for altcoins. For the moment, the resistence approach and we must remain cautious. Also, the momentum is always fragile because the RSI is still below its weekly downtrend line.
Exchange tokens ready to take off?
The FTX platform has created a index which groups several different tokens exchange platform. Here is the graph:
The graph is very interesting, because it is the only one it has maintained support built after the fall of May 2021. This shows that the token exchanges are a lot solid. The price could quickly find itself at the level of resistence.
In addition, the momentum of RSI is about to break its trend line. This will be confirmed at the end of the candle, in early August. If so, it is a trend line that started in May 2021 that would break and could therefore unblock purchasing force.
If the upside continues, it might be interesting to look at tokens like the BNB (Binance Coin)the FTT (FTX token) etc
The dominance of bitcoin gives a bearish signal
The dominance of bitcoin lets you know if the the capital goes to Bitcoin or altcoins. For lovers of very risky assets, it is interesting to note that the chart is bearishas this indicates that players are leaning towards altcoins.
The dominance of Bitcoin is in a ordered for more than a year. The break of the support or the resistance will allow to have Important information :
- Breaking resistance : if the resistance gives way, the capitals move towards the Bitcoin. This is a bad sign for altcoins and could indicate a continuation of the bear market.
- Breakage of the support : if the support fails, it is a bullish signal for altcoins. This would mean that capital is pouring into altcoins. We could also talk about altseason in the event of a support outage. This support has held up three times, if the price returns to this level, there is little chance it will hold up again.
Currently, the price has broken the uptrendline (brown). From now on, the odds are oriented towards a back to support level as shown in the graph. Be careful, though, if Bitcoin were to drop sharply and lose the low a $ 17,650, the dominant position could recover rapidly. In short, you have to wait for a breakout of the support or resistance to put the odds on your side.
Altcoins could benefit from shorts
For several months, the actors aggressively short altcoins :
the financing rate is an indicator that allows us to evaluate the behavior of operators in derivatives markets. In May 2021, after the sharp decline in Bitcoin and altcoins, the funding rate was largely negative. A negative financing rate indicates significant selling pressure in derivatives markets and this often leads to a tighten shorts.
The current situation resembles the one known in the summer of 2021, we can also see it the financing rate is more negative than last year. If Bitcoin consolidates or rises slowly, the altcoins could speak.
The cryptocurrency market is highly correlated with the US market. Despite a negative macroeconomic environment, the market is recovering and returning to growth. A few months from The Merge, Ethereum looks set to bounce in value and take altcoins with it. If so, the tokens of exchanges are likely to be attractive as they exhibit resilience. Since the breakout of the $ 30,000 zone, Bitcoin remains fragile and could, at any time, bring down the altcoins. Although the situation is reminiscent of that experienced in May 2021 on the derivatives markets, Bitcoin has broken an important support and sellers can regain control at any time.
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