The Bitcoin and altcoin market caps have been decreasing since June. Both have reached significant support areas and have shown signs of initiating a reversal.
The Bitcoin price has been relatively stable over the past three weeks. However, several notable altcoins were subject to double-digit price decreases in a matter of hours on December 10. This caused the altcoin market cap to decrease significantly as a result.
Full-time trader @coinzada outlined a chart for the altcoin market cap while asking the question: “Still holding alts?”
Still holding alts? pic.twitter.com/lOPc1zZaeW
— James (@coinzada) December 10, 2019
Altcoin Market Cap
Looking closer at the total altcoin market capitalization, we can see a significant support area at $60 billion. This coincides with the 0.786 Fib level of the entire upward move beginning in December 2018.
Additionally, there is a bullish divergence in both the RSI and the MACD in higher time-frames, suggesting that the market cap will hold above this support area and increase.
This sentiment is strengthened by the presence of long lower wicks.
Lower time-frames also reveal a bullish pattern. Since November 22, the altcoin market cap has created an Eve & Adam double bottom. This is a bullish pattern that suggests an upward move will follow.
If the altcoin market cap breaks out above the $64 billion resistance, it could initiate another upward move — suggesting that the correction has ended.
Total Market Cap
Cryptocurrency trader and analyst @davthewave stated that the total crypto market cap has decreased to the 0.618 Fib level of the entire upward move that began in December 2018.
Still on track… all the way from August. 50% retracement in BTC, a level further in the total market cap. pic.twitter.com/Ti6abhfIEc
— dave the wave (@davthewave) December 10, 2019
He stated that the Bitcoin market cap has retraced to the 0.5 level, the total cap to the 0.618 level, and — as we saw in the previous section — the altcoin market cap has retraced to the 0.786 level. This makes sense since the total market cap is created by the two.
Similar to the altcoin market cap, the total market cap has generated strong bullish divergence in the RSI. Furthermore, it is trading inside a descending channel and has bounced at the support line of the channel.
The bullish hammer that was created at the support line suggests that an upward move towards the resistance line is likely and a breakout could follow.
To conclude, both the total and the altcoin market caps have reached significant support levels and created a type of bullish pattern. It is likely that they will continue to increase in the near future, suggesting that the correction in relation to the upward movement of 2019 has ended.
Images courtesy of Twitter, TradingView.
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Source: Be In Crypto