Inverse Head-and-Shoulders Pattern Building in Altcoin Market

An Inverse Head-and-Shoulders Pattern Building in the Altcoin Market

An inverse head-and-shoulders pattern, a trusted bullish price setup, is currently forming in the altcoin market. This pattern could potentially signal the start of an “alt season,” where alternative cryptocurrencies outperform bitcoin and ether. Technical analysis by Josh Olszewicz, a crypto trader and former researcher at Valkyrie Investments, suggests that altcoins may be poised for a bullish trend.

Key Points:

The inverse head-and-shoulders pattern forms when an asset has three price troughs, with the middle one being the lowest.
A breakout or trend change is confirmed when prices rise above the trendline connecting the peaks between the lows.
The post-breakout price target is determined by adding the depth of the pattern to the breakout point.
The altcoin market cap has shown a triple bottom/inverted head-and-shoulders situation, indicating a potential bullish trend.
The pattern will be complete once the market cap rises past the neckline resistance near $300 billion.

The altcoin market cap is currently consolidating around $230 billion, but a break above $300 billion is needed to confirm the pattern. Olszewicz believes that the pattern is still developing and is waiting for this breakout. However, it’s important to note that the altcoin market cap turning lower could invalidate the pattern.

“Alt season” refers to a period where altcoins outperform market leaders like bitcoin and ether. The altcoin market cap rising past $300 billion could indicate the onset of such a season. It’s worth monitoring the development of this pattern, as it could have significant implications for the altcoin market.

Hot Take:

The formation of an inverse head-and-shoulders pattern in the altcoin market suggests a potential bullish trend. This could lead to an “alt season” where alternative cryptocurrencies outperform bitcoin and ether. However, it’s important to remain cautious and monitor the market closely as the pattern is still developing. A break above $300 billion in the altcoin market cap would confirm the pattern and signal the start of an alt season.