Bitcoin price has begun to take off like a rocket, but the rest of the crypto market has remained at a crawl.
However, if the TOTAL crypto market cap chart from TradingView moves much higher, it could break a key level that in the past reversed the downtrend and sent the market “parabolic.”
Total Crypto Market To Trigger Parabolic SAR
The beginnings of a cryptocurrency bull market could be upon us, but you might not know it just yet. Unless you are looking at Bitcoin, that is.
Several altcoins started off the year with a bang, but have since fizzled out and gave back some of their gains to BTC, according to Bitcoin dominance and individual trading pairs against the top cryptocurrency by market cap.
The rest of crypto is slightly behind, but could soon start another parabolic rally, if TOTAL crypto market price action can tag the Parabolic SAR indicator on the 3-week timeframe.
BTCUSD has already reached the trigger level causing the SAR indicator to change directions and begin to appear below price action. Will the total crypto market cap chart do so next and what might that mean for performance?
The crypto market could go totally parabolic | TOTAL on TradingView.com
Could This Be The Sign The Trend Has Officially Reversed?
The Parabolic SAR tells traders when the previous trend has stopped, and officially reversed. Created by J. Welles Wilder, the Parabolic SAR is said to be shockingly accurate. So accurate, it is often used as part of a trailing stop loss strategy.
Wilder also created the Relative Strength Index, Average True Range, and many others. His tools are core tenets of technical analysis and some of the most popular and reliable today.
In 2015, after the Parabolic SAR was tagged, the total crypto market went on to surge more than 17,000%. In 2019, only 80% ROI followed before a reversal, but in 2020 the signal offered 800% to make up for it. The historic rally took the crypto market from a little over $200 billion to more than $2 trillion in total combined market capitalization.
Now, after spending more than 400 days below the Parabolic SAR, the downtrend has stopped. Could tagging the Parabolic SAR on the 3-week timeframe be the signal the trend has also officially reversed? And could the crypto market once again go parabolic like the indicator’s namesake?