A closely followed analyst says that altcoins are likely about to spark new rallies while Bitcoin (BTC) decides its next move.
Pseudonymous trader Rekt Capital tells his 470,000 followers on the social media platform X that altcoins are at the beginning of the “hype cycle” phase where they find bottoms before making new impulses to the upside.
“Welcome to the Q2 Altcoin Hype Cycle
The Altcoin Bottoming Out process is in progress.”
At time of writing, the total altcoin market capitalization is coming in at $294 billion, up from $76 billion in November of 2022 during the worst of the bear market.
Looking at Bitcoin, Rekt Capital says BTC is potentially forming a bull flag on the monthly chart. Bull flags, as the name suggests, are typically seen as bullish technical setups that imply an upward impulse and then a brief consolidation before another move up.
“Imagine if Bitcoin was forming a Monthly Bull Flag right now.”
However, according to the trader, those looking for a longer and more robust bull market may prefer BTC to consolidate for longer before continuing upward. He says that a clean break of $71,500 could indicate that BTC is in for a shorter, faster bull run.
“Extended consolidation here would get Bitcoin closer to resynchronising with historical Halving Cycles
After all, the current acceleration in the cycle is still around 190 days (which is an improvement from the 260-day acceleration set in mid-March when BTC made new All Time Highs)
On the one hand, investors understandably want a breakout, but that would entail an Accelerated Cycle, where Bitcoin would probably peak in its Bull Market sooner
On the other hand, extended consolidation here would help with resynchronisation with historical Halving Cycles, resulting in a longer Bull Run
There is no right or wrong answer – both cases are bullish
It’s more a question of whether we get a shorter bull run or a typically long one
History suggests we should see a typically long one but Bitcoin is one Weekly Close above the $71500 Range High from going against the grain of history once again.”
At time of writing, Bitcoin is trading at $70,221.
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