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Following Bitcoin’s meteoric rise in 2017, retail investors searching for the next Bitcoin loaded up on altcoins and other crypto assets hoping to get in early and strike it rich.

But the bubble popped, and now altcoins are down in some cases as much as 99% from their all-time high prices set back during the peak euphoria of the bull cycle. However, one crypto analyst says that the worst is still yet to come for the altcoin market, and a much deeper drop could be ahead.

Altcoin Apocalypse Hasn’t Started Yet

Bitcoin and altcoins have an unusual relationship, oftentimes diverging in price showing uncorrelated price action, while other times the two asset types rise and fall together in a correlated manner.

2019 kicked off with both asset types bottoming out and going on to rally shortly thereafter. But once April 2019 hit, the two crypto asset types diverged and have yet to become correlated once again. Bitcoin went parabolic, gaining as much as 350% at the first-ever cryptocurrency’s local 2019 high, meanwhile, most altcoins suffered huge losses in their BTC ratios, and some even went on to set new bear market lows.

Related Reading | Crypto Market Carnage: Altcoins A Sea of Red As Bitcoin Breaks Down 

Many were calling the capitulation event the altcoin apocalypse, and talk about the asset classes’ demise became commonplace.

Alts have since begun to rebound once again, reviving some of the bullish sentiment the asset class once enjoyed, even despite still being down as much as 80% or more in many cases.

However, even though altcoins have taken an extreme beating, second only to altcoin investors themselves stuck holding increasingly heavy bags, one crypto analyst believes that the worst is yet to come for the altcoin market, with a deep fall to lower support a strong possibility in the weeks ahead.

According to one prominent crypto analyst, the altcoin market cap failed to break back above former support turned resistance, was rejected, and is now heading back to support dating back to the 2017 crypto bull market. In fact, the analyst believes that if that support level fails, the altcoin market cap, which includes all crypto assets in the market sans Bitcoin, could fall to support from 2013, essentially wiping out the last five years of gains these assets have experienced.

While many altcoins are already down 99% from their all-time high prices, it doesn’t mean that the price of these assets cannot fall further if any remaining value is sucked out of the market in a massive sell-off.

Related Reading | Crypto Analyst: Altcoin Apocalypse Caused Bitcoin Bear Market 

If the altcoin market falls to such depths, the cryptocurrency industry and technology may be considered a failed experiment, possibly only leaving Bitcoin and a select few others standing as a result. However, if the total altcoin market cap can break out of downtrend resistance and reclaim former horizontal support turned resistance, such a sell-off would turn into FOMO, and possibly a full-blown alt season.

Tony Spilotro , 2019-11-27 20:00:39

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock

Nick Chong , 2019-11-10 12:00:38

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