The mood of the crypto market shifted from “a new bear market started” to “long live the bull market” in a matter of weeks.
Looking at the big picture of the crypto market capitalization starting from the bottom in March 2020, things become clearer. The excessive euphoria that grew during the first months of 2021 needed a reset. The RSI captured this general weakness precisely, with lower highs diverging from higher highs during the market trend.
It was easy to confuse the large crash in May with the beginning of a prolonged downtrend period. But as the market rebounded exactly at the bottom of the upward trend, investors and traders found the confidence to turn bullish once again.
The rebound also occurred at the 61.8% Fibonnaci level, enhancing the importance of that area as strong support in the future. In the short term, 23.6% is the first support in case of a pullback. Consolidation in the green box would be beneficial for the long-term development of the trend. Should Bitcoin cool off below $50,000, that could be a good opportunity for Altcoins to have their moment of glory .
Accumulating on dips and scalping long strategies are still the best way to capitalize on the current market condition. The trend is always your friend, after all!