The total cryptocurrency market cap has been correcting since June 26. In the long-term, it looks close to reaching a bottom. A breakdown below significant support could indicate that we are in an extended bear market.
Since reaching the $345 billion high on June 26, the cryptocurrency market cap has been decreasing. It initially looked as if the trend reversed on October 25 but the recent price movement has jeopardized the possibility.
Cryptocurrency analyst and trader @davthewave posted a chart showing the total crypto market cap along with the question: “Is this bearish or bullish?”
Yup, and I ask you, is that bearish or bullish?🙂 pic.twitter.com/YkMdQUwpuf
— dave the wave (@davthewave) November 20, 2019
Let’s analyze the cryptocurrency market cap price movement along with technical indicators to see if we can provide an answer.
The total cryptocurrency market cap has been decreasing since June 26. It made a low at 210 billion in October, finding support at the 0.618 fib level.
There was a failed breakdown shortly afterward, which lead to the rapid upward movement of October 25.
At the current time, the price is again retracing towards the $210 billion levels. A breakdown below this area could trigger a very rapid decrease towards $170 billion.
Cryptocurrency Market Cap Trend Reversal?
In order to determine the current trend, we have used a trend-line dating back from 2015. At the current time, the price is slightly above this trend-line — making it likely that the price will bounce above it.
We can see that the entire upward move was preceded by a bullish cross between the 50- and 100-week moving averages (MA).
A bearish cross of these same MAs occurred in February of 2019. At this time, the price is trading between the 50- and 100-week MAs.
It looks as if the price will bounce at the convergence of the support line and the 50-week MA, begin an upward move, and cause a bullish cross of the aforementioned MAs. However, if that does not occur and instead we break down, it would likely mean that we are in an extended bear market.
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 Twitter, TradingView.
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Source: Be In Crypto