A popular crypto strategist warns that altcoins are on the verge of a major downward move as he updates his view on Pepe (PEPE) and Avalanche (AVAX).
Pseudonymous analyst Altcoin Sherpa tells are 195,100 Twitter followers that altcoins could fall as much as 50% of their current prices.
However, he says there are likely to be bounces on the way down if they cross key support levels.
“It is possible that altcoins have another 30%-50% downside to take off from here in the long run. If that happens, there will be bounces in between.
Frankly, prices are currently at support levels, so we expect an increase here across the board.”
According to the trader, the memecoin Pepe will be allowed soon bounce after collapsing about 67% from its all-time high.
Altcoin Sherpa says a confluence of technical indicators, including the Fibonacci retracement levels and the visible range of the volume profile (VPVR), suggest the memecoin could be witnessing a short-term rally.
Traders keep a close eye on the VPVR as it shows price areas where market participants were actively trading an asset.
Altcoin Sherpa says,
“PEPE: I think this is a support area; expect the price to bounce. Fib (Fibonacci) level + higher volume area at VPVR, S/R (support/resistance) level. I’m not sure how high it goes, but let’s see. I still have a PEPE function.”
Pepe is worth $0.00000156 at the time of writing, up 11.7% in the last 24 hours.
The trader is also eyeing Ethereum (ETH) rival Avalanche, which he notes traded in a broad range between $13 and $21 for most of 2023. According to Altcoin Sherpa, AVAX could bounce once it hits the lower end of the range.
“AVAX: Help Is On The Way In Mid $13s.”
Avalanche is worth $15.14 at the time of writing, up 1.2% in the last 24 hours.
Another cryptocurrency on Altcoin Sherpa’s radar is the Layer-2 scaling solution Polygon (MATIC), which he say could find support at the $0.75 price level.
“MATIC: I think it’s bouncing fast, but I still don’t know if it will drop around $0.75.”
MATIC is trading at $0.86 at the time of writing, up 3% over the past 24 hours.
Finally, the trader say Injective Protocol (INJ), a decentralized derivatives exchange, could see a brief uptick in the near term. However, he warns that INJ is still in a downtrend and could drop below $4.
“INJ: This one has done great in the past, but I think it will still go below $4 in the long run. Still expecting some bounce here and the .618 fib (fibonacci). Probably a good place to hang out here for a long time – S/R (support/resistance) level, fib, etc.”
At the time of writing, Injective is trading at $6.07, up 4.9% over the past 24 hours.
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