- Michael van de Poppe tweeted yesterday that smaller capped altcoins are in an accumulation phase.
- The analyst shared that the accumulation trend is evident in the weekly Others charts.
- Technical indicators suggested that the collective market cap for altcoins may drop in the coming week.
The renowned cryptocurrency trader and analyst Michael van de Poppe tweeted yesterday that the cryptocurrency market is in an accumulation phase. In the post, he added that the accumulation phase can be seen in the weekly chart for the total market cap for cryptocurrencies excluding Ethereum (ETH) and Bitcoin (BTC).
Two stages of capitulation:– Price capitulation (May '22 surrounding the $LUNA collapse).– Time capitulation (happening since -> 470 days now).That's the accumulation phase, shown by the Others #Crypto chart. Be wise, accumulate. pic.twitter.com/pN1kiuGIHV— Michaël van de Poppe (@CryptoMichNL) August 6, 2023
Daily chart for Others market cap (Source: TradingView)
From a technical standpoint, a symmetrical triangle had formed on the daily chart for the total market cap of all cryptocurrencies except ETH and BTC. This pattern suggested that a breakout in the total market cap of these assets is imminent.
Should this breakout be towards the upside, the total could rise to $120.185 billion in the coming 2 weeks, which is the next major resistance level on the daily chart. However, technical indicators pointed more towards a bearish breakout in the upcoming few days. Most notably, a significant bearish technical flag was triggered between the 9 and 20 EMA lines.
The 9-day EMA line had crossed bearishly below the 20-day EMA line throughout the past 48 hours. This indicated that the total market cap for all cryptocurrencies except the two market leaders has entered into a short-term bearish cycle, and that it may drop in the coming week.
A confirmation of this bearish thesis will be when the total closes a daily candle below the crucial support level at $106.137 billion. Should this happen, the collective market cap of smaller capped cryptocurrencies will be at risk of dropping to the next significant support level at $95.355 billion.
This bearish thesis will be invalidated if the total is able to close 2 consecutive daily candles above the 9-day and 20-day EMA lines at around 109.89 billion. In this scenario, the total may look to rise to the aforementioned $120.185 billion resistance in the following 48 hours.
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