A recent youtube video published by Michael van de Poppe, aka CryptoMichNL, shared insights on the altcoin market that shows signs of life, even as Bitcoin continues its consolidation phase. This comprehensive analysis explores the potential for a bullish breakout in the altcoin space.
As CryptoMichNL pointed out, the cryptocurrency market is inherently cyclical, and current conditions mirror previous cycles. This alignment suggests that the altcoins may be approaching a bottoming-out phase, heralding a potential shift in the trend. The Altcoin Dominance chart illustrates this with a significant bullish divergence reminiscent of previous pre-halving periods. These historical patterns indicate that altcoins could be gearing up for an upward run.
The analyst took to Twitter to provide an optimistic view of altcoins, commenting, “Altcoins are in their depression phase and are ready to start trending upwards”:
Examining the total cryptocurrency market cap, it’s evident that the market is still consolidating, teetering on a crucial support level. A breakdown could lead to a retest of support levels between $780 billion and $900 billion. However, recent higher lows indicate the market may be gearing up for a new consolidation phase.
The Wall Street Wyckoff cheat sheet further supports the notion of impending downward momentum before a new bull cycle begins. All signs suggest that the cryptocurrency market is approaching the final stages of its correction.One indicator that aligns with this narrative is the Bitcoin dominance chart, which is currently testing the 200-week EMA, potentially signaling a decline in Bitcoin’s dominance and a resurgence of altcoins.
CryptoMichNL singles out Chainlink as a noteworthy altcoin. Despite being in a bear market since November 2020, Chainlink shows signs of deviation and a retest of support levels, potentially setting the stage for a significant upward movement.
Several cryptocurrencies have emerged as standout performers, with recent remarkable gains. However, the sustainability of these rallies is yet to be confirmed. Such breakouts offer potential trading opportunities, particularly when applying strategies like the Wall Street cheat sheet.
CryptoMichNL offers three strategies for trading altcoin breakouts. First, the breakout continuation play involves buying into a breakout and capitalizing on the subsequent price increase. Second, the support-resistance flip strategy identifies key support levels after a breakout and aims to capture upward momentum. Lastly, the breakdown shorts strategy is riskier and involves shorting assets during bearish resistance phases.
The key takeaway from this update is that the cryptocurrency market is in a pivotal phase. While some altcoins are already showing promise, real opportunities may arise as the market goes through its final consolidation before a potential bull cycle.
While anticipating future developments in the cryptocurrency space, it remains crucial to stay informed and contemplate these strategies when navigating this ever-changing landscape. Whether one is an experienced trader or a newcomer, the crypto market presents enticing opportunities for those open to exploring its potential.
