This time we will be looking at the chart for the altcoin project named the Internet Computer, the trading pair ticket is ICPBTC.
As the market is now, full bullish after a very strong and over-extended bear-market, the price action will be very interesting and rewarding for the bulls.
Cryptocurrency market price action dynamic:
- When bitcoin consolidations (goes sideways) or retraces (goes lower but within higher low territory), the altcoins vs bitcoin (ALTSBTC) pairs grow, move up.
- When bitcoin moves up, the altcoins vs bitcoin (ALTSBTC) pairs start to retrace or consolidate.
- When bitcoin grows the altcoins vs Tether (ALTSUSDT) pairs also tend to grow simultaneously.
- When bitcoin enter a correction phase, this can happen every 1-2 months, the entire cryptocurrency market (altcoins vs bitcoin and vs tether pairs | ALTSBTC & ALTSUSDT) can also go into correction mode and once the correction is over the above dynamic can resume playing out.
Back to the the Internet Computer, ICPBTC, below the chart:
Most of the altcoin trading pairs within the market have very similar charts and they all tend to move together in a general sense.
- When the market is bullish the majority grows.
- When the market is bearish the majority drops.
ICPBTC hit a low in June 2022 and was quickly followed by a bullish wave. Many other altcoins as well as bitcoin hit a low around this date, mid-2022, this will be a repeating theme throughout the charts we read.
This bullish wave I just mentioned peaked in July and a strong correction took place. This correction ended in 19-December 2022 when another low was hit. This time the price was higher than the December low and thus we end up with a higher low.
- 19-December 2022 ICPBTC hits a low of 0.0002050.
- 11-June 2022 ICPBTC hits a low of 0.0001963 (lower).
This is a basic yet very strong bullish signal.
The fact that this higher low happened 6 months later, long-term, makes it a strong bullish signal.
If it had happened only a few days later it would still be valid but not as strong. The longer it takes, the stronger the signal becomes.
The next signal is the pattern drawn with purple lines, we call it a falling wedge.
We have descending prices with a trend converging to one final point. Once the upper trendline of this channel is broken, we can say that a bullish breakout took place for this pattern.
You can also ignore the lower part and just draw the upper trendline, in this case a downtrend line, and once this downtrend is broken we have the signal that the bulls have taken the upper hand.
Next is the RSI. We are looking at the daily timeframe:
- Below 20 we consider the RSI to be weak/”oversold”.
- At 40 we consider the RSI to be doing good.
- Above 50 we enter the bullish zone or strong.
- When the RSI goes above 80, we reach the very strong area which can also be called “overbought”.
In this case we have a 60 reading on the RSI telling us that ICPBTC is strong on the bullish zone.
If we were looking at the weekly timeframe, we go by different numbers because just one section has 7 days. A reading of 35 for example on the weekly can be considered bullish vs the daily where this same reading would be bearish. More on this another day.
Finally, this is the last signal we will read for this chart and that is the moving averages. We use EMAs, exponential moving averages, which is just like the classic moving averages but more weight is given to more recent price action rather than the past, in a nutshell, they move faster.
- EMA10 is for the short-term. When the price of a cryptocurrency trading pair is moving above this indicator, in my charts always green, then the short-term potential favors the bulls (up). Below this indicator the potential switches towards the bears (down).
- EMA21 is just an extra but also short-term.
- EMA50 gauges the mid-term potential of a pair. Above bullish and below bearish.
- EMA100 gauges the strength of the mid-term potential. If the altcoin trading pair goes above EMA100, the mid-term potential is now really strong.
- MA200, not shown here but always a black line in my charts, gauges the long-term potential.
ICPBTC is now trading above EMA10, EMA21, EMA50 and EMA100.
This signal is confirmed once the daily candle/session closes above these levels.
In a nutshell, we have multiple signals that support a bullish bias for this altcoin pair:
- A long-term higher low.
- A falling wedge pattern.
- A strong RSI.
- Prices trading above multiple exponential moving averages (emas).
These signals combined tell us that the Internet Computer is ready to move ahead.
But… The charts can always change, so be prepared.
Thank you for reading.
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