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As the cryptocurrency market faces a broader decline, altcoins have faced significant challenges, with Ethereum (ETH) leading the way with losses approaching 20%.
This decline comes after Ethereum repeatedly failed to break the crucial resistance level of $4,000, a barrier that has proven to be formidable in recent months and also prevents a decline. Cryptocurrency To reach new highs as Bitcoin (BTC) did to close out 2024.
Altcoins Mid-Cycle Correction: Road to Recovery?
Market expert Ash Crypto recently provided insights in a social media post on X (formerly Twitter), on the current state of altcoins, suggesting that they are undergoing a “mid-cycle correction.”
According to Ash Crypto, this phase is a natural part of the bull market cycle and may pave the way for the recovery of previously lost value and potentially higher gains for these digital assets.
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In his country Social media sharingThe expert highlighted historical precedents, noting that similar price movements were seen in January 2021, before the start of the altcoin season that captured investors’ attention.
Despite the recent volatility, Ethereum and other altcoins have shown slight signs of recovery, with Ethereum managing to rise above $3,200, and rebounding from its closest support level of $3,100.
This recent rally has prevented further losses and sparked hope among traders. However, Ash Crypto warns that another decline could be on the horizon before more occur Sustainable recovery It can take root.
Market whales may shake retail investors
In his analysis, Ash Crypto expects altcoins to see an eventual market correction before entering what he believes will be a full bull mode later this year.
The expert pointed to the chart he shared, which depicts the total market cap of altcoins excluding Bitcoin And Ethereum, which showed a potential consolidation between the $926 billion and $930 billion levels.
This consolidation phase could precede a move towards the peak of the bull cycle, which is expected to reach $3.39 trillion.
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Adding to the excitement, Ash Crypto noted that Bitcoin dominance appears to have peaked, indicating that altcoin season is imminent. However, he warns that before this potential boom, the market must Whales It may attempt to unsettle retail investors by manipulating prices.
At the time of writing, ETH is trading at $3,215, up over 3% on the 24-hour time frame. Other altcoins such as XRP, Solana (SOL), and Cardano (ADA) also rose by 5%, 3%, and 5.3%, respectively, in the same time frame.
Taking into account Ash Crypto’s analysis, it remains to be seen whether further consolidation or another correction will take place for altcoins before the most notable gains for these digital assets in history are achieved.
Featured image of DALL-E, chart from TradingView.com