The Altcoin Market Could Be Heading for a Final Capitulation in August
The allure of altcoins and their incredible returns when the crypto market is bullish keeps investors buying these high beta assets. However, this strategy comes with higher levels of risk and volatility. Now, it appears that the altcoin market could be ready for a final capitulation, and there are a variety of charts that support this idea. In fact, signs point to this happening in August.
Pinpointing Trend Turns With TD Sequential
One notable technical indicator that suggests a change in the altcoin market’s trajectory is a TD9 sell setup in Bitcoin Dominance on the 1M TD Sequential chart. “Perfected” setups are only confirmed with a higher high or higher low, depending on the direction of the sequence. This leaves room for one more high in BTC.D during August, before a larger reversal between the relationship of Bitcoin and altcoins.
Timing Tool Lines Up Miraculously With Altcoin Market Cap Chart
A comparison of the total altcoin market versus Bitcoin from 2013 through 2015 shows a similar pattern. After a peak in November, altcoins bottomed 59 bars later in December. This timing lines up precisely with Bitcoin’s November 2013 peak and January 2015 bottom. Although the price action in between is different, altcoins could be heading for a double-bottom type situation in August. This would match up with the first or second week of the month, just as it did in Bitcoin’s case.
Ethereum Versus Bitcoin Climax Coming Within Two Months?
Lastly, taking a zoomed-out look at the cyclical behavior in ETHBTC, it appears that a bottom should be put in between Ethereum and Bitcoin in the coming two months if the corrective behavior continues to form with cyclical accuracy. Bitcoin outperforming Ethereum can happen for two reasons: Bitcoin rising while altcoins remain relatively stable, or altcoins crashing harder than Bitcoin. Both scenarios have occurred throughout this year, and it is possible that we have not seen the end of this pattern. However, once it is over, it should be time to favor altcoins again.
Overall, the charts and technical indicators suggest that the altcoin market could be heading for a final capitulation in August. While this comes with higher levels of risk and volatility, it also presents an opportunity for investors to potentially capitalize on the subsequent rebound in altcoins. As always, it’s important to carefully analyze the market and consider the potential risks before making any investment decisions.
