Altcoins
Will the epic altcoin boom of 2017 soon be repeated? Indicators are lining up for something huge
Is the market already recovering from its lows? Various indicators over different time frames, from weekly to medium-term, suggest that the market has likely exhausted its downtrend, as highlighted in Blockchain Backer’s latest analysis.
The last discussion highlights the importance of confluence, where multiple indicators align, in assessing market trends. Historical examples, such as the anticipation of Bitcoin hitting $12,000, explain the role of emotions in market sentiment. In retrospect, previous market lows and indicators validate the current analysis, showing the strength of major altcoins like Ethereum and XRP since June.
Despite widespread expectations of further declines, there were signs that the market was behaving similarly to past recovery phases. Prolonged talk in 2021 of a supercycle over and corrective style was also observed. Retail behavior during this recovery included increased risk-taking, particularly evident in meme coins.
Signs of market behavior
The analyst said that many familiar signals indicating that the market had bottomed out had emerged, as in previous cycles. On the other hand, as the market approached higher levels, worrying signals emerged, coinciding with an increase in retail investor confidence.
He discussed the challenge of assessing current conditions, especially for altcoins like XRP, given historical time frames and observed market structures. Comparing the cycles from 2013 to 2017 and recent years, he noted that market expansions typically follow similar phases of consolidation and recovery.
Comparison of historical cycles
The analyst also pointed to past patterns where major market rallies followed similar structures, such as the epic altcoin boom in 2017 with its huge gains. Looking at the current market, he saw a mix of signs and uncertainties, particularly around investors’ risk sentiment and the number of them buying different types of assets.
He said it’s critical to watch for signs that investors are willing to take on more risk and that more people are getting involved in trading. Historically, these signs have occurred just before big market shifts. While things are complicated and unpredictable right now, he believes we could be on the verge of something big, if good things start happening soon.