Altcoins Consolidate Above Support As Inflows Indicate a Robust Bid

4 min readApr 6, 2022

Altcoins are back on traders radars, with Ethereum sparing no time to lead the market rally. Currently, most setups are technically favourable for team bull, but this is crypto and the market can be treacherous.

Let’s dig in.

Dear readers,

The purpose of this newsletter analysis is to provide context to current events and cryptocurrency markets. It is released every Monday and Wednesday. I am not perfect and this is not a science — nor is this newsletter a signals service. While I cannot promise perfection I do my best to be honest and transparent.

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New data from analytics platform Santiment reveals that Litecoin transaction volumes are on the rise, all the while the network’s hashrate reached a milestone not seen in three years.

Read the full article here!

Technically speaking

Ethereum Consolidates Above $3,000

Ethereum/Dollar is down 3.5% week-on-week and currently exchanges hands at the pivotal $3,300 — $3,000 order block.

The coin is consolidating above resistance and has maintained its relative strength against Bitcoin, reaching ₿0.076 before cooling off.

As of this moment, ETH/USD is bullish. In order for the pair to remain bullish, there must be follow-through.

For that to manifest, the $3,000 — $3,300 order block must be defended on a weekly closing basis.

In the last altcoin analysis, we discussed the significance of on-balance volumes in relation to the ETH/USD breakout structure. Briefly, the OBV tends to spike before consolidating and setting a trend. Provided bulls are not faking the entire move, then one can expect the psychological support zone to act as a springboard.

Technically, the daily RSI hit overbought conditions three times during the run-up, so consolidation is not unusual. However, in upward trending markets the RSI can remain in overbought territory for a prolonged period while prices surge. If this is a developing trend, the RSI shouldn’t spend any time below 50 (currently 57).

All in all, it’s reasonable to maintain a bullish bias provided the nearest support holds. If ETH/USD rallies to $4,000 it would become less attractive to buy purely on a risk-reward perspective (and also keeping in mind the ETH/BTC chart). Speaking from experience, historically, it doesn’t tend to end well when Ethereum/Dollar leads Bitcoin/Dollar. In such instances, the market tends to be attempting new heights on borrowed time.

Relative Bitcoin strength would certainly be a welcomed site moving forward.

Litecoin Consolidates below 200-daily EMA

Meanwhile, Litecoin/Dollar is down 7% week-on-week, exchanging hands at $119.3 at the time of writing. The coin rejected off $134 and is in the process of retesting the breakout structure.

LTC/USD trades below the 200-daily EMA and is seemingly unable to get a sustained bid. It is in effect, an inferior trade to BTC/USD which has yet to prove itself. That’s not to say it won’t. In fact, my interest in Litecoin has nevertheless grown as I see a lot of unrealised value in the project.

Regardless, counter-plays make sense from risk-reward perspective provided $112 holds. The low-time-frame consolidation led to the local breakout, hence the level’s pivotal importance.

Looking ahead, LTC/USD’s main hurdle is the 200-daily EMA ($142). If reclaimed, price-action below the 2019 high ($138) can be treated as a macro deviation. Litecoin tends to move quickly and in an explosive manner when it gets going. The question on everyone’s mind is whether Litecoin wants to be taken seriously (as a real contender) moving forward or not. Time will tell.

Monero to $280?

Monero/Dollar exchanges hands at $218, and is effectively flat on a weekly basis at the time of writing. At ₿0.0048, the privacy-native coin has also shown relative strength to Bitcoin, and has broken out of an order block of accumulation.

Locally, XMR/USD is wedged between the range pivot ($230) and the 200-EMA. If one side breaks, one can reasonably expect expansion to either the order block ($177-$188) or $280.

Monero’s relative strength to Bitcoin is technically compelling, but weakness in majors is unlikely to work in its favour.

Catch you later.

p.s. This is my opinion. It is not financial advice.

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