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Bitcoin is lacking clear directional bias for a ninth straight day. The price consolidation has neutralized the bullish view put forward by a long-tailed doji candle created on Feb. 27. As a result, a fall back to levels below $3,700 cannot be ruled out. A UTC close above the March 9 high of $3,950 would revive the short-term bullish outlook and may yield a rally toward the recent high of $4,190. While a few alternative cryptocurrencies (altcoins) have recently witnessed a longer-term bull reversal, the altcoin market as a whole, as represented by the total altcoin market capitalization, is yet to exit the bear market. A bull breakout in the altcoin market would be confirmed, if and when, the altcoin market capitalization beats the long-term falling trendline resistance, currently at $64.28 billion.Bitcoin’s (BTC) struggle for direction continues amid growing talk of a bull reversal in alternative cryptocurrencies.
The leading cryptocurrency by market value is trapped in the range of $3,800 to $3,900 for a ninth straight day, contradicting the quick move to $4,000 suggested by the long-tailed doji candle created on Feb. 27. The immediate outlook, therefore, is neutral.
As of writing, the cryptocurrency is flatlined at $3,847 on Bitstamp, representing a 0.10 percent gain on a 24-hour basis.
Further, BTC is reporting a meager 4 percent gain on a year-to-date (YTD) basis, as opposed to stellar gains in few altcoins. For instance, litecoin, the fourth largest cryptocurrency by market capitalization, is currently up 83.9 percent on a YTD basis.
Binance coin (BNB) and holochain (HOT) are up at least 140 percent each, while EOS (EOS) and ontology (ONT) have gained 40 percent and 69 percent, respectively, according to OnChainFX.
Meanwhile, both the BTC and USD pairs of LTC, BNB, Tron (TRX) and Maker (MKR) have found acceptance above their respective 200-day moving average (MA) – a widely followed barometer of bull/bear markets.
As a result, speculation that the altcoin market has entered the bull market is gathering steam. While few alternative cryptocurrencies seem to have witnessed a bull reversal, the altcoin market as a whole is yet to violate the bearish trend, as seen in the chart below.
Altcoin market cap
On the weekly chart, the altcoin market capitalization (market cap) printed a higher low near $45 billion in early February, signaling bearish exhaustion. However, the trendline connecting January 2018 and April 2018 highs is still intact.
A weekly close (Sunday, UTC) above $64.28 billion (trendline resistance) could be considered an early sign of longer-term bullish reversal.
A bearish-to-bullish trend change, however, would be confirmed, if and when, the market cap jumps above $68.61 billion – a bearish lower high created on Dec. 24.
It is worth noting that the market cap of a cryptocurrency is calculated by multiplying the total number
of circulating coins with the current market price. As a result, the market cap chart tends to mimic the price chart.
Hence, studying the altcoin market cap chart – an aggregate of the total crypto market cap minus bitcoin’s market cap – offers a better view of the altcoin market.
Bitcoin’s daily chart
The week-long price consolidation in the range of $3,800-$3,900 seen in the above chart has weakened the bullish case put forward by the long-tailed doji candle created on Feb. 27. As a result, the 100-day MA support at $3,670 could again come into play.
On the higher side, a UTC close above $3,950 is needed to revive the short-term bullish outlook.
Disclosure: The author holds no cryptocurrency assets at the time of writing.
Bitcoin image via Shutterstock; charts by Trading View
