Ether, XRP, and DASH Push Higher as the Altcoin Market Gains Momentum
Altcoins have been stealing the show recently, as some large caps have seen tremendous surges along the field. Bitcoin Cash ABC (BCH), Bitcoin Cash SV (BSV), Dash (DASH), and Ethereum Classic (ETC) have all shown increases of more than a hundred percent recently but it is a bit premature to be calling for celebrations at the new altcoin season? Perhaps no, but at least it’s a reason to dedicate some attention to altcoin market analysis.
Crypto market daily performance. Source: Coin360
Total altcoin market capitalization breaks downtrend and facing resistance
The total altcoin market capitalization broke the resistance at $65 billion and rallied towards the next resistance at $77 billion which is the current level.
Total altcoin cryptocurrency market capitalization chart. Source: TradingView
The current price action within the altcoin markets has many similarities to the price movements observed in February 2019. A similar period of consolidation below support can be spotted there, before the upwards rally to the high of June 2019 occurred.
The total altcoin capitalization has been hovering below the $60 billion resistance as well for some time. The breakout of that level started a significant rally of 30% and the current surge is encountering resistance at the $78 billion areas, which is a big hurdle to overcome.
Total altcoin cryptocurrency market capitalization 6-hour chart. Source: TradingView
The chart showing the current range between $72 and $78 billion. If the market capitalization breaks below $72 billion, a retest of the previous resistance at $65 billion should be the next level. However, a breakout above $78 billion could trigger a further surge towards $100 billion.
Altcoin dominance facing potential breakout
Altcoin dominance chart. Source; Cointrader.pro
The altcoin dominance chart is showing a potential breakout to the upside and the 34% level is tested for the third time now. The general rule is, the more often resistance is tested, the more likely a breakout will follow.
If the altcoin dominance chart breaks out to the upside, targets of 44% and 54% are defined from the charts. However, what is required to maintain a surge in altcoin dominance? The large caps have to start moving, starting with Ethereum (ETH).
Ethereum breaks a 7-month downtrend
ETH USDT 1-day chart. Source: TradingView
Ethereum is showing a similar USDT chart as Bitcoin here. Breaking the 7-month downtrend and currently hovering at a higher level to search for support. Where Bitcoin is doing that at the $8,500-8,600 area, Ethereum is doing the same in the $157-160 area.
The chart is showing the strength of this level, as Ethereum couldn’t break through it earlier in 2019. But, during September - November of 2019, it used to be a support.
If this area becomes support, a continuation to the upside to $195 and $230 is likely.
Ethereum against BTC breaks a 2-year downtrend
ETH BTC 1-day chart. Source: TradingView
Ethereum is showing a different picture in the BTC pair, actually a bullish one. As the chart shows, it broke a 2-year long downtrend. The downtrend started in the peak bull market, December 2017, and looks to be over for now.
Similarly, altcoins are showing identical movements lately through which Dash, Ethereum Classic, and more have been seeing tremendous movements. The primary reason being that they also broke their multi-year long downtrends.
For instance, if Ethereum remains above 0.018 satoshis, targets of 0.025 and 0.286 satoshis are on the table. The chart is also showing a higher low made recently, as the overall low is found at 0.016 satoshis. The recent low (green rectangle) is showing a level of 0.0171 satoshis, which marks the start of a potential uptrend.
ETH BTC 1-day chart. Source: TradingView
XRP continues to consolidate
XRP BTC 1-day chart. Source: TradingView
XRP (XRP) is showing a similar setup as Ethereum. The bottom formation was found in the period around September 2019, where a retest is occurring right now. Similar to Ethereum, it’s facing a 1-year old downtrend in the next week(s).
If we go back to older breakouts of XRP, then we can see that there’s a usual compression before the actual breakout. The left part of the chart is showing a slightly higher low plus compression before a breakout. Compression means the price is moving in a narrow range, after which it breaks out robustly.
XRP against USD faces massive resistance
XRP USD 3-day chart. Source: TradingView
The XRP chart against USD is showing a bounce from the support at $0.18, after which priced moved upwards to the $0.25-0.28 area. As the chart shows, this can be seen as a crucial area to breakthrough.
The price of XRP held the $0.25-0.28 area as support during 2018 and 2019, which makes it a hard hurdle to take. However, if XRP breaks through that level, targets of $0.48 are on the table.
Other altcoins breaking major downtrends
One of these examples is Dash.
DASH BTC 1-day chart. Source: TradingView
Dash is giving us an impressive chart. The retrace ended at the January 2016 levels, which remarkably also marked the low for altcoins in the past market cycle.
Since it’s hit that level, a bullish divergence occurred and the price surged 195%. Remember, bullish and bearish divergences usually signal a potential trend reversal.
Interestingly enough, a similar move occurred in January 2016, as the price of Dash also surged around 180% during that period.
Another secure sign for Dash is the current support, which is found at 0.01 satoshis. Even though the price retraced to this level it hs bounced 25% since.
Is this a signal for altcoins to wake up? It’s at least showing that some of them are getting back up again. However, the primary indicators are Ethereum and Ripple. When these start to move, usually the rest of the market follows.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.