The altcoin market cap has reached a significant support level and has shown some signs of moving upward. However, the lack of a trading pattern does not allow for confirmation of this upward movement.
When the Bitcoin price decreases, most altcoins do so at a more pronounced rate. However, that has not been the case, recently — since several altcoins have been posting double digit increases over the past two months. This has lead many to call for the beginning of “altseason”.
Technical analyst and cryptocurrency trader @CryptoDude999 expressed his skepticism that altseason will begin once Bitcoin capitulates. He suggested that the altcoin market cap chart does not look good and we have yet to see the worst of it.
I don't understand why people think that once $BTC starts dumping it's going to be alt season.
Alt marketcap looks terrible and seems like the worst is yet to come. pic.twitter.com/5BCC2N6OJs
— CryptoDude (@cryptodude999) November 27, 2019
Long-Term Altcoin Trends
When comparing the 2014 correction to the current one, several similarities arise. The altcoin market cap made a low slightly above the 0.5 Fib level, which was followed by a bearish cross between the 50- and 100-week moving averages (MA).
In the first correction, the market cap made another higher low, followed by a bullish cross of the same MAs before beginning the upward move that continued until 2018.
Currently, the altcoin market cap has made a higher low.
Retracement
Looking at the 2019 bull market, we can see that the altcoin market cap has retraced all the way to the 0.786 Fib level at $65 billion.
While it briefly decreased below it, it created a long lower wick and immediately moved upward. This is a sign of buying pressure.
Furthermore, we can see a significant bullish divergence in the RSI — which has been developing since the beginning of September.
Since it is present in higher time-frames, it suggests that an upward move might soon begin.
To conclude, the altcoin market cap has shown some bullish signs — which are supported by a fractal comparing them to the previous upward move. However, they are not strong enough to warrant a confirmation. The lack of a trading pattern makes it difficult to predict a breakout.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images courtesy of Shutterstock, TradingView.
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