A widely followed crypto analyst is warning that the total altcoin market capitalization could soon bleed out a whopping $60 billion.
In a new strategy session, Nicholas Merten, the host of DataDash, tells his 512,000 YouTube subscribers that the altcoin market cap is likely in a bearish pattern after recent bounces failed to print higher highs, indicating that the downtrend is intact.
“Altcoins set in a fourth lower high here since back in May. Just within this period of time here. And it looks like we’re ready to roll over back into this range around $150 billion [in October].
So another roughly $60 billion haircut for altcoins, more than another 25% correction from here on out, even after all the bloodshed that we’ve seen in altcoins.”
To support his thesis, Merten says the smart contract platform Ethereum (ETH) has failed to break above the $2,000 level despite key bullish developments in its ecosystem.
“ETH/USD had two failed breakouts at $2,000, actually a third failed breakout here…
This is an ascending triangle. If we don’t get some buyers here soon, and we snap below there, that will be a year-long bullish pattern where the bulls did not show up.
This was the prime opportunity. You had all of the optimism, the kind of blind narratives of ETH 2, EIP- (Ethereum Improvement Proposal)1559, and ‘We got to go long just because the supply is going to be reduced.’
But people focus too much on the monetary policy aspect of crypto and they don’t ask the fundamental question, which is much bigger: are there more eager buyers or sellers?”
Ethereum is trading for $1,627 at time of writing, down 1.1% in the last 24 hours.
The trader also says he will likely short Bitcoin (BTC) given the current market conditions. According to Merten, Bitcoin’s price is soon likely to fall below the 200-week exponential moving average (EMA), which would indicate bearishness.
“This looks like it’s about to snap guys. And for those of you who are wondering whether or not I’m looking to short, yeah, I’m getting ready to short here. This has been the time where I feel quite confident because our indicators flipped red. The moving averages here are barely just hanging by a thread here when it comes to price.”
Bitcoin is trading for $25,785 at time of writing, down 0.8% in the last 24 hours.
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