A crypto strategist who nailed Bitcoin’s (BTC) 2018 bottom believes we’re in for a rough few weeks after this year’s bullish start.
Pseudonymous analyst Smart Contracter tells his 219,300 Twitter followers that many altcoins have already completed their five-wave rallies.
The analyst is referring to the core principle of the Elliott Wave theory, a technical analysis approach that tries to predict future price action by following crowd psychology that tends to manifest in waves. According to the theory, a bullish asset is likely to witness a corrective move after going through a five-wave uptrend.
Says Smart Contracter,
“People aping alts expecting higher, where I’m pretty sure were gearing up to top for a few weeks, especially altcoins. Five-wave rises on daily literally all over the place, most notably on TOTAL3 which is [the market cap of] all alts excluding BTC and ETH.”
Looking at the analyst’s chart, he expects the market cap of all altcoins excluding Ethereum to shed nearly 10% from around $365 billion to $330 billion, suggesting a significant downside risk for crypto assets other than Bitcoin and ETH.
One of the altcoins on the trader’s radar is Ethereum rival Avalanche (AVAX). Smart Contracter shares a chart showing that AVAX has completed a five-wave ascent on the eight-hour chart and is likely to correct to around $15.
At time of writing, AVAX is changing hands for $20.72.
The crypto strategist is also keeping a close watch on decentralized oracle Chainlink (LINK). According to a chart he shared on Twitter, LINK has also completed its five-wave surge and is likely poised to retrace to just above $6.
At time of writing, LINK is trading for $7.31.
It’s the same situation for interoperable blockchain Cosmos (ATOM), according to Smart Contracter. The analyst also believes that ATOM has concluded its five-wave rise.
At time of writing, ATOM is switching hands for $13.71.
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