The latest rise in the crypto markets seems to have rugged most of the bears as the selling pressure is slowly dropping. Now that the Bitcoin price has made a move above $64,000 in the early trading hours, the next move could elevate the levels above $65,000. The market dominance of Bitcoin is increasing and as a result, the price is all set to materialize a fine upswing.
On the other hand, the altcoins are displaying remarkable strength as their market capitalization has made a bullish move above the pivotal range. After a brief correction, the altcoin market capitalization (excluding BTC & ETH) has achieved a pivotal range of $600 billion. With this, the levels have broken a major descending pattern, which may pave the way for an extended bullish action.
The market cap was trading within a falling wedge and the latest move has pushed the prices above the upper resistance but this move is yet to be validated. The bears have begun to extract some profits but here are the reasons shared by an analyst as to why the altcoins could be at the foothills of a massive explosion.
- The sellers seem to have exhausted as altcoins reach key lows as they are unable to push the prices further down. This has led to the formation of a demand zone and a stable, low-volume range-bound environment.
- Market sentiment is notably low, with many participants facing losses
- Trading volume diminishes, accompanied by weeks of small-bodied candles, signalling market stagnation
- The order books are thin on the supply side, indicating limited selling pressure
- A significant upward move can occur with minimal volume, swiftly erasing months of gradual selling in just days or weeks
- Fear of missing out (FOMO) emerges as traders chase the initial breakout, which often results in shallow retracements
- Bearish sentiment persists among those who were bullish during the entirety of the decline, often leading them to short the first significant impulses off the lows
- These shorts, unaware of the thin supply, can be easily squeezed, fueling upward price momentum
- The combination of short liquidations and momentum-driven buying propels prices even higher
- This dynamic creates a powerful rally, pushing prices significantly upward.
Therefore, it appears to be a golden period for the altcoins to accumulate, as a major move is all set to occur shortly. However, to do so, the altcoin market cap is required to hold the crucial range of $600 billion, which may form a strong base for the rally beyond which the altcoins may begin a strong upswing.
