Crypto Market Crash: this technical structure puts an end to the upward trend

Although the encryption market has been on the rise since early 2020, Bitcoin and altcoins may be experiencing the first stages of the first major correction of the year.

The technical structure of the recent upward trend in the short term has broken, suggesting that a further decline is expected in the coming days. However, the upward trend in the higher terms remains strong, so any correction is likely to be limited and recover to new highs after an established local minimum.

The technical structure of the uptrend of the crypto market is blurred, but the daily closure will decide the fate.

The class of crypto assets has been among the best performing assets of the new year, in any financial market, only behind the highlights such as Tesla.

Bitcoin has risen more than 40% so far this year, and altcoins in all areas have skyrocketed. The number two cryptocurrency by market capitalization Ethereum has increased more than 100%, doubling its value in just a few weeks.

Meanwhile, further down the list, altcoins like Link or Tezos have been on fire, quadrupling their value in just a few weeks in the new year.

But the explosive upward trend may be coming to an end, at least in the short term, according to a break in the market structure.

Upward trends by definition are a series of higher lows and higher highs set consecutively after a definite minimum set. The upward trend ends once a maximum is placed, and then a lower minimum is established to confirm the conclusion of the bullish momentum.

In the daily terms, the total cryptocurrency market is only a few hours away from setting its first lowest low since the uptrend began.

Technically, two wicks have already reached lower minimums, but the daily price candles have not closed below the minimum established on February 10.

By looking at an uptrend channel that has formed throughout the year, the total capitalization of the encryption market can still be seen operating within the channel. A wick extends from the bottom of the channel, but again, no candle has been closed to confirm the lowest drop and end the uptrend.

The lack of a candle closure could indicate that the total crypto market could increase further from here, but after more than 70% of profits in all areas, a correction of more than 10% is likely to be justified in the following days.

The danger of a deep correction will not prevent the bull market, according to the action of the longer term price

Even if a deep correction arrives, the upward trend remains safe and intact in higher terms, such as weekly and monthly. It is only shorter terms that are in danger.

A new lower minimum will not be established in the weekly terms until market capitalization falls below $ 219 billion. The total value of the current encryption market is $ 276 billion, compared to a minimum of $ 165 billion set at the end of December 2019.

In monthly installments, a new lower minimum will not be established unless the market falls back below $ 165 billion. Such an event would suggest that the long-term trend was again bearish, and an extended downtrend would be almost guaranteed.

Such an event is extremely unlikely after two full years of a bear market and with so many signs confirming that a new bull market is being formed for Bitcoin and altcoins in the coming months.

Reference: newsbtc.com

Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.

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