The Great Fakeout

As of yesterday (Monday Aug 6 2024) the markets have been met with huge speculation that everything is crashing. As far as the crypto market goes, it was all a fake out. Let’s look at the charts…

1st off, lets examine the BTC-Dominance chart.

Its in a rising wedge. It will most likely eventually fall out of this formation to the down side. When it does, it is also likely it will fail through the top purple line as it will want to correct down to the base of the rising wedge. If that happens, it is likely BTC-D will continue down further. Making ALTs see some upside. Note there is also divergence in the chart.

Next, let us examine the OTHERS-Dominance chart.

The OTHERS.D chart is a chart that looks at the dominance of all the ALT coins basically. It excludes the top 10 cryptos. So this is mid to low caps. The formation here is a head and shoulders pattern. Now, as this is typically a very bearish pattern. Let’s examine it a little closer… The “crash” that happened, landed on it’s secondary support line, wicked slightly below it and bounced.

I stated in my telegram weeks ago that I believe this H&S pattern will invalidate. I believe this for a few reasons which I will discuss further. But, if this invalidates, ALTs will see a significant upside rally.

Now let’s look at the BTC chart.

This broadening wedge speaks for itself, it is a continuation pattern. It is forming on heavy resistance and needs time to build up momentum to get over but when it does, and retests, it will solidify it’s position on new support. Also, note the divergence.

Now for the TOTAL2

The TOTAL2 excludes BTC, it tells a more detailed story if you know how to read it. Regardless, it is in a clear bull flag and it just faked out the entire market, kissing the lower support band with a quick wick down to liquidate over leveraged longs. It since has climbed back into it’s formation.

Now for the TOTAL

This is the TOTAL crypto market cap. It tells the whole story of that the market is doing. Again in a nice broadening wedge pattern which is also a bull flag. There is some heavy resistance (the yellow line) and it needs to build momentum to get over, retest and continue. The bull flag is the place to build this momentum. Also note the fake out wick, perfectly touched the FIB circle. Since it has climbed back into its formation.

Conclusion

We are still in continuation patterns across the board. There are divergences everywhere. The “crash” was just panic wick-down’s to lower supports and fib areas. All signs smell of a fake out to panic the market and wick out some longs before the market continuation. Nothing more, nothing less.

It was a great buying opportunity. Other then that, ignore it and continue to hodl. I for one did nothing and went on about my day.

Categorised in: Cryptocurrency Trading, Technical Analysis

This post was written by BlockAdvisor