Crypto Technicals Turn Bullish As Bitcoin (BTC) Ends Six-Month Downtrend
Top-Down Crypto Looks Bullish
While Bitcoin’s recent price action signals almost anything but a bull rally, some analysts have begun to argue that technical indicators are starting to turn in the favor of cryptocurrencies. JB, an industry commentator on Twitter, recently took to his feed to convey why the two-week crypto market capitalization chart, which includes Bitcoin, Ethereum, and each and every altcoin in circulation, is looking relatively bullish.
The up-and-coming analyst, followed by a number of respected ecosystem participants (Gemini, CoinMetrics, Francis Pouliot, etc.), noted that at long last, the measure’s value has broken out of a long-term falling wedge pattern, established in early-2018. Adding to his bullish narrative, JB noted that not only has the downtrend ended, but the Willy measure reads oversold, much like the Relative Strength Index. This could set precedent for a short-term rebound, which will send Willy back to a neutral mean, at the very minimum.
2W Crypto Total Market Cap ($) chart: Price breaking out of falling wedge pattern, Willy over-sold, MACD confirmed bullish momentum divergence and about to turn positive but most amazing: That volume! I do not know how TV calculates, but this sure looks impressive: pic.twitter.com/64uUiWtwmi
He adds that while the Moving Average Convergence Divergence (MACD) has yet to enter a positive zone, the popular trend forecast indicator has entered a bullish state, which has only been underscored by the notable levels of volume seen in the crypto market. (Interestingly though, Tether (USDT) on-chain volumes are reaching highs, leading some traders to suspect that there is a copious amount of fraudulent volume at current.)
JB’s recent comments come after Galaxy, a self-proclaimed cryptocurrency accumulation machine who commands a following of tens of thousands, began to remark that from his point of view, an “altseason” is right around the corner.
According to previous articles from this very outlet, Galaxy noted that as Bitcoin dominance has barely inched higher in recent months, the stage could be set for altcoins to surge relative to their godfather, BTC. The analyst noted that he wouldn’t be surprised to see BTC’s share of the cumulative value of cryptocurrencies fall under 30%.
In subsequent tweets, Galaxy doubled-down on this pseudo-call, noting that as a declining trend line was breached, in a move backed by high volumes and convincing price action, he expects for the crypto space “to moon fkn hard.”
While there seems to be a substantial amount of fuel behind a rally in the broader cryptocurrency asset class, there’s arguably a lot going for Bitcoin in specific.
Weeks ago, EWN divulged that per data from Dow Jones, BTC closed January’s candle in the red to post its sixth month of consecutive losses. But, just one month later, this losing streak ended. In the past 28 days, the flagship cryptocurrency has proved its potency, opening the month at $3,500 and closing at $3,900 apiece.
Weighing the sight for sore eyes in the green monthly candle, Mayne, a popular industry personality, took the opportunity to draw attention to two scenarios that the cryptocurrency market could realistically undergo. Although he painted a chart depicting lower lows, the Twitter noted that he is “leaning towards” a bullish move, which will see BTC embark on a notable rally after briefly revisiting its $3,150 low, established on December 14th, in an act of price consolidation.
Other analysts echoed Mayne’s cautious optimism, explaining that the potential reversal could signal that good things are to come for this market in the coming months.
Title Image Courtesy of Tim Mossholder Via Unsplash