A technical indicator shift has sparked predictions of an imminent altcoin surge, with one analyst on X forecasting gains as sharp as those posted in 2017 and 2021.
This Technical Indicator Just Shifted To Green
Taking to X, the analyst said this optimism follows a change in the Gaussian Channel, a technical indicator used to assess market momentum. On X, the trader notes that the Gaussian Channel has, after weeks, flipped from red to green.
Reading from historical performance and indicator changes suggests that there could be a bullish shift for leading altcoins like Ethereum, Solana, and even Dogecoin in the days ahead.
However, from a technical standpoint, this upswing would be better confirmed once there is a comprehensive breakout above the immediate resistance. If this happens, the altcoin market could have a “parabolic” rally.
The broader crypto market is bullish, sparked by the encouraging Bitcoin rally. The world’s most valuable coin trades above $50,000, trending at December 2021 levels. Supporters are optimistic that not only will Bitcoin register more gains in the days ahead but will likely float to break November 2021 highs.
This uptick in demand follows institutions and investors leveraging spot Bitcoin exchange-traded funds (ETFs) to hold Bitcoin.
Surging Bitcoin prices have immensely benefited coins like Solana and Ethereum and meme coins like BONK, which continue to trend. To illustrate, SOL is now trading above $100 despite a recent network outage that questioned the platform’s reliability. In January, SOL peaked at over $125.
On the other hand, Ethereum continues to rally but remains below $3,000. Rising decentralized finance (DeFi) activity and optimism of the United States Securities and Exchange Commission (SEC) approving a spot Ethereum exchange-traded funds (ETF) continue to fuel demand. Recently, Franklin Templeton applied with the regulator for a spot in Ethereum ETF, joining BlackRock and Fidelity.
Altcoin Market Cap Approaches $1 Trillion
It is unclear how strongly altcoins will rally should buyers take over. Gauging from how leading altcoins like Solana and Cardano have performed in Q1 2024, it is likely that prices will explode to register new 2024 highs, breaking above 2023 resistance levels.
Based on CoinMarketCap data, the altcoin market cap has nearly doubled. It is up from around $475 billion in late 2022 to over $910 billion when writing in mid-February. When altcoins peaked in November 2021, their cumulative market cap exceeded $1.6 trillion.
Feature image from DALLE, chart from TradingView
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