Ethereum And Altcoins Crash: Why Is This Analyst Super Bullish?

By PR1ME at Tue, 02 Apr 2024 18:00:02 +0800 | Altcoin |

Ethereum And Altcoins Crash: Why Is This Analyst Super Bullish?

Altcoins like Ethereum, Cardano, Solana, and the rest might be lower at spot rates. However, according to one analyst who sees a parallel in the current formation to the 2020 market cycle, they are gearing up for a potential surge. 

In a post on X, the analyst says that often, after a period of accumulation and a retest of previous highs, altcoins tend to be volatile. The crypto analyst also notes that Bitcoin has pulled back from its all-time highs and is preparing for a possible retest of this level registered in March. 

Bitcoin accumulating | Source: Analyst on X

Though altcoins have been decimated, looking at price action in the past 24 hours, altcoins are on a bullish path, similar to the last cycle registered in 2020. The analyst says Bitcoin will catalyze the altcoin swing to fresh levels and valuations.

Will Altcoins Repeat The 2020 Cycle?

For now, it is hard to predict the exact valuation of top altcoins. However, the analyst notes a similar formation in the current price action. 

When altcoins consolidated after surging, prices tended to recover strongly. This spike was evident, especially once Bitcoin broke through critical liquidation levels and entered “price discovery” or fresh all-time highs. 

Bitcoin price trending upward on the daily chart | Source: BTCUSDT on Binance, TradingView

Currently, Bitcoin is in this position. The coin is trading lower and cooling off from all-time highs. Even after higher highs last week, bulls didn’t break the $71,700 level in the daily chart. With BTC collapsing, altcoins also fell, with Ethereum, Solana, and top coins slipping below support levels. 

Will Ethereum And Other Altcoins Bounce Back Strongly?

The altcoin season might come earlier this time, especially once Bitcoin recovers. Possible triggers include the upcoming Bitcoin halving event. Analysts claim that halving will likely create a supply crisis, causing scarcity. If institutions funnel the same demand level, BTC will likely rip higher, breaking $71,700 and even $73,800 all-time highs.

Beyond this, upcoming network upgrades in Ethereum, like the recently mentioned “Purge” and Firedancer integration in Solana, might trigger demand. Developers are working towards Voltaire in Cardano. All these changes plan to make the top smart contracts platform more reliable and enhance performance. 

Besides network upgrades, analysts are considering the possible approval of spot Ethereum exchange-traded funds (ETFs). If the United States Securities and Exchange Commission (SEC) approves this product, ETH might benefit by lifting others. It might also accelerate the drafting of fitting laws, especially now that BlackRock thinks tokenization and real-world assets (RWAs) are the future of finance. 

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