Popular trader Peter Brandt believes that Ether (ETH) saw a significant breakout in its ETH-BTC pair on July 9. According to the veteran trader, the breakout could be a signal that a new altcoin season could occur in the near-term.
“Significant breakout in ETH-BTC with target of .03276 BTC. Most alts should gain on Bitcoin in near future.”
ETH-BTC daily chart. Source: Peter Brandt
The strong performance of alternative cryptocurrencies in recent weeks coincides having an Ether rally and the expectation that upcoming network upgrades will solve the scaling conditions that plague the network all through peak transaction phases.
Cardano, Kyber Network, Compound, and Chainlink surge as Ether rallies
In days gone by week Cardano (ADA), Kyber Network (KNC), Compound (COMP), and Chainlink (LINK) four major altcoins recorded substantial gains contrary to the U.S. dollar, Bitcoin, and Ether.
All four cryptocurrencies had key network upgrades, product launches, or high-profile announcements which drove their values higher.
Cardano, for instance, transferred a node containing all of the changes of its Shelley upgrade onto the mainnet. On July 30, a difficult fork on the Cardano blockchain will finalize the highly-anticipated Shelley upgrade. This positions Cardano to rival Ethereum being an established proof-of-stake (PoS) network.
Kyber Network also rallied following the release of Katalyst. To put it simply, Katalyst allows users to stake KNC so that you can participate in KyberDAO and take advantage of various incentives. In theory, it is just like the staking mechanism of Ethereum 2.0.
Crypto market research firm Santiment said:
“KNC’s top 100 non-exchange addresses have spiked since Katalyst, and it appears that the top 10 overall holders have upped their ownership of the total supply from 48.6% 48 hours ago, to 52.2% (over half) of the total supply at today’s market close.”
Kyber Network demonstrates a highly optimistic on-chain trend. Source: Santiment
The positive sentiment around alternative cryptocurrencies combined with exploding demand for decentralized finance-related tokens seemingly have added to the confidence of investors.
According to data from Binance Futures, investors remain majority long on many altcoin pairs. In fact, more than 50% of traders on the platform are holding long contracts on LINK, ADA, KNC, and COMP.
Ether’s bullish market structure could further benefit altcoins
Some traders predict the Ether rally will keep on in the 3rd quarter of 2020 as a result of favorable market structure and currently the altcoin is testing a significant multi-year resistance level at $250. The altcoin briefly broke above this level 3 x in the past fourteen days.
The last twice the price of ETH cleanly surpassed $250, it led to rallies to above $280 and $360.
Traders are seemingly optimistic on the near-term trend of Ether as the altcoin has weakened a key resistance level with multiple retests. This is basically because when a support or resistance level gets tested often in a short span, the probability of it being broken rises.
A comparison of ETH-USD fractals. Source: Byzantine General, TradingView.com
The increasing amount of altcoins enabling staking in the wake rapid growth in the DeFi sector and the expectations of an Ether rally could support a solid bullish trend in the altcoin market.
Ether trading volume has also remained relatively high throughout the past ten days as the price hovers above $240. This suggests that buyers are keen to push the price higher despite strong selling pressure at a vital resistance area.