The Altcoin Market Is Now Flirting With The 350 DMA ...Again!

10월 3일

Here's what that means. A long-term view.

Traders,

The pressure is on for these altcoin bulls to run through the end of the year. However, we are flirting with disaster this time around. Here's why?

From the beginning, the 350 DMA (or 50-week MA) has always told traders whether we were in a bull market or a bear market. Though periodically, the price did stick its proverbial head above the 350 DMA during mid-cycle tops, these were always very short-lived. And it's always been the case that when we've remained above the 350 DMA for this length of time, in this case since Nov of 2023, it signaled we were in a bull run, as opposed to a mid-cycle top. Could this time be different? Well, of course. And I think from looking at the charts, it already has proven it is. This whole run is different.

I won't get into the many ways this cycle is different, but a big one has to do with how the 111 DMA is diverging from the 350x2 DMA (not pictured here). That's never happened before along with a multitude of other occurrences. So, let's explore this thought experiment a bit further. There are several outcomes that we most probably are looking at.

The first outcome could mean that this run was simply an extended mid-cycle top. If true, then this is a much longer mid-cycle top than we have ever witnessed in the history of crypto. And if that is true, the bull run that is coming will melt faces. But it probably would not arrive until next year or even 2026 and it probably means that we dip back under that 350 DMA again for a while. Nobody wants this to happen and nobody seems to be expecting this outcome. Could this then be the strongest possibility? If we anthropomorphize the market a bit, we can observe that it is rather sadistic in this regard. It always has been and probably always will be. The market just enjoys hurting the largest crowd. This is why it's often beneficial to entertain contrarian thought and not to simply dismiss it altogether.

The second outcome is not so good. It could mean that we skipped our mid-cycle top completely and that our bull run is about to end if we dip below that 350 DMA. Now, there is still hope here because we haven't done that yet. But I certainly do not like the looks of how we have been flirting with that line for these last several months. This moving average is critical! Watch it closely on both the daily (as a 350 DMA) and on the weekly (as a 50). The weekly will confirm whether we drop or not. It must be confirmed with two candle closes below on the weekly.

There is a third possibility. This is the one that I think we are all hoping for and, tbh, most are expecting. It also indicates that we skipped our mid-cycle top and are in a bull run that will not end until late this year or into the next. This would mean that we will remain above that 350 DMA (though, there could be a few candle closes below) and that we should see some new highs being made through the end of the year.

I kept our chart on the daily view as opposed to the weekly because I wanted you all to track that bullish triangle with me. Notice how we are retesting the top of it as we should after a breakout. This is technically very sound. But also notice how that 350 DMA is moving up to lend some support. What a beautiful area of confluence! But also, scary. Because if it's broken to the downside, it may indicate either another Black Swan event on the horizon OR we don't get the bull run alts were expecting.

It is do-or-die time now. Let's go.

Stew