Upward Movement in Altcoin Market Cap
The daily technical analysis of the Altcoin Market Cap indicates a bullish trend. Following a rebound from the $500 billion support level on June 15, the ALTCAP has been on the rise.
On June 30, it broke through a descending resistance line, signaling the end of the previous correction. It then validated the line as support on July 7 before accelerating its rate of increase.
The daily RSI confirms the breakout and supports its continuation. Traders often use the RSI as a momentum indicator to assess whether a market is overbought or oversold. In this case, the RSI reading is above 50 and moving upwards, indicating a bullish trend.
Currently, ALTCAP is trading above the 0.618 Fib retracement resistance level at $600 billion. According to Fibonacci retracement analysis, after a significant price movement, the price tends to retrace partially before continuing in its original direction. Breaking above this level further supports the bullish scenario.
If the upward trend continues, ALTCAP can potentially reach a new yearly high of $700 billion. However, if it were to close below the 0.618 Fib level, a drop to the next support at $540 billion could occur.
Bitcoin Dominance Rate (BTCD) Weakens
The Bitcoin dominance rate broke through the 58% level in early June, reaching a new yearly high of 52.15% by the end of the month.
However, it faced resistance at the 0.382 Fib retracement level of 52.15%, resulting in the formation of a large bearish weekly candlestick.
If the downward trend continues, the Bitcoin dominance rate could fall back to the 48% area, which is expected to act as support.
The reaction upon reaching this level will be crucial in determining the future direction of the trend. A bounce from this support could signal a resumption of the upward trend toward 58%.
On the other hand, if the support breaks, it would indicate that the previous breakout was not valid, potentially leading to new lows.
Despite the bearish short-term outlook, if the Bitcoin dominance rate manages to close above the yearly high of 52.15%, it would still indicate a bullish trend. In such a scenario, there is a likelihood of an immediate increase of 58%.
*Disclaimer: This topic is only for informational purposes, not investment advice.