Alts Market Cap will probably test the Weekly 200SMA (near 65B Market Cap) before pushing higher. All attempts failed and probably will continue failing until we test the Weekly 200SMA. We have a small probability to bounce at this level but the weekly candle (after this last failure) suggest weakness and more downside for the next 2 weeks (or more).
Alts Market Cap is potentially forming a descending broadening wedge but it also faces the fact that the daily 200SMA (red line) may not hold in the current conditions. BTC continues to rip alts and we can’t be sure where or when it will stop. Again my Bullish sentiment is more inclined for an alts season starting in the next 2 to 4 weeks but I can be wrong and alts may keep going down.
On the short term ETHBTC is testing new Lows but how about mid and long term?
Monthly chart shows something interesting and it eventually gives us some clues about what may happen if some conditions are met. First of all my mid/long term sentiment is Bullish and will remain Bullish unless we start breaking some “strong” supports (0.011BTC or 0.008BTC for instance). That said, ETHBTC is near two major supports, 0.018BTC on the monthly and 0.016BTC on the weekly. Considering the fact that ETH fundamentals (transactions, network activity, and so on) aren’t dropping we can expect them to increase as soon as we have some positive price action. Market is very cautious at the moment because everyone seems afraid of BTC achieving new local lows (8k or less) but if it doesn’t happen this month price will not lag forever.
Nevertheless if the market gains more confidence and ETH holds at this levels closing the month near 0.016 or 0.018 and if we have a bounce in the next month that bounce may signal the beginning of a strong reversal. Never forget that corrections are slow and boring, but Bull Runs can last less and move fast. The monthly chart clearly shows 6 big green candles and plenty of small red candles (ignoring the first 2 months).
If we consider the fact that Binance (one of the major exchanges) is 30 days away from blocking all U.S. customers from the regular exchange (where many alts are traded) the fact that BTC dominance is again near another local High shouldn’t be a surprise. Nevertheless the big question remains the same when and how strong is the next Alts Season (since all attempts to start one failed).
At the moment, it’s hard to guess when since we don’t have strong patterns playing out and also because the bounce on many BTC pairs is now vanishing with some of them already reaching new Lower Lows. On the other hand BTC may test the top of the short term downtrend and if it breaks out from that channel alts probably will suffer a bit more. Best case scenario Alts may finally start recovering after September 12 but nothing is granted. After all, BTC and Alts may keep lagging until October/November or they can do something else.