‘Longer and Steeper’ – Analyst Explains What’s Ahead for Altcoins
The trader draws comparison between Chainlink’s current trend to Ethereum’s past, suggesting early-cycle upward movements and investment entry points during 30-50% corrections.
New Bull Run to Bring Plenty Returns
CEO & Founder MN Trading, Michaël van de Poppe revealed why he thinks great buying opportunities in crypto are still plenty.
His comparison on X (formerly Twitter) suggests that the current crypto market situation is similar to the end of 2015 and 2019. During these periods, significant growth was observed, like Ethereum’s rise from US$ 1 (AU$ 1.54) to US$ 14 (AU$ 21.50) and eventually to US$ 1,400 (AU$ 2,149), yielding substantial returns. Van De Poppe expects that similar high returns could occur again, with current projects potentially offering 5-10x returns at the start of a new bull cycle.
Corrections Ahead
However, it’s also noted that these upward trends often include corrections, where prices temporarily drop back to higher timeframe support zones, which can be good entry points for investors. The “DeFi summer” of 2020, which might reoccur in 2024, is highlighted as an example of such a trend.
DeFi Summer 2020 and 2.0 in 2021, Source: DeFi Lama
Additionally, his analysis points out that within these upward trends, significant corrections of 30-50% can occur before reaching peak values. These trends and corrections are visible across different timeframes, whether it’s 1 hour, 4 hours, or 15 minutes.
Key to navigating these market dynamics
Van de Poppe highlights the similarity between Ethereum’s past price action and the current trends in Chainlink’s price. Chainlink (LINK) has experienced a modest correction of 20%, with the possibility of a further correction to 30% making the trend more evident. He explained this situation is comparable to earlier phases of Ethereum, where spotting and taking entry points was relatively straightforward.
ChainLink/ TetherUS, Source: TradingView/ Michaël van de Poppe/ X
In his discussion he also points out that Chainlink’s rally, which lasted less than 5 weeks, suggests we might be at the early stages of an upward cycle. In the case of Arbitrum (ARB), another cryptocurrency, it’s noted that it is currently in a support phase and experiencing a corrective movement similar to the broader market.
Arbitrum/ USD, Source: TradingView/ Michaël van de Poppe/ X
The key takeaway is that corrections leading to higher timeframe support areas indicate a likelihood of market continuation from those levels, making them ideal points for potential investment entries. The advice is not to be overly concerned if an altcoin drops by 30-50% at this stage in the cycle, as these moments can present valuable entry opportunities.
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Filed under: Bitcoin - @ November 20, 2023 3:11 am