Altcoin Market Update #112

Hello and welcome back to the Rekt Capital Newsletter

In today’s edition, the following cryptocurrencies will be analysed & discussed:

• Chainlink (LINK)
• Ethereum (ETH)
• Litecoin (LTC)
• Solana (SOL)
• Aerodrome Finance (AERO)
• Pendle (PENDLE)
• Ethena (ENA)

But before we dive in, this Friday I’ll chart your Altcoin picks in an exclusive subscriber-only TA newsletter and will cover as many as I can

So if you’d like to have an Altcoin charted, feel free to share max. two TA requests each in the comments below.

I’ll chart the Altcoins that get mentioned and ‘Liked’ the most

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Let's dive in to today's Altcoin Market Update.

Chainlink - LINK/USDT

Chainlink has enjoyed a fantastic rally over the past couple of months.

In fact, price has now revisited a major resistance (orange), a resistance that has historically rejected price into an -81% correction and a -60% one.

But it's clear this region is weakening as a point of rejection, the only question is by how much is it weakening.

Of course, best-case scenario is that LINK will break the orange resistance and turn it promptly into support to enter trend continuation.

But time and again, the market has shown that some resistances take time to be broken because they need to progressively get weakened to a sufficient extent.

If LINK were to reject from this orange resistance, a -27% pullback would see price drop into what could be a new Range Low at $19.36 for price:

Whereas a deeper pullback could see price even tumble up to almost -50%:

But even if that deep downside were to occur, it could be in the guise of a volatile retest of the black $19.36 level, in much the same way as in mid-2021 (long downside wicks in the orange circle).

So both rejections would still revolve around $19.36 being retested into new support; it's just a case of how volatile that retest would need to be to position price for a challenge into new highs not seen in years.

Alternatively, if LINK simply Monthly Closes inside the orange resistance and holds it as support, then perhaps price would be ready to additional upside much sooner; but if this resistance rejected price -81% then -60%, then it's difficult to envision there suddenly being no rejection whatsoever on this upcoming attempt.

Ethereum - ETH/USD

Ethereum has successfully broken a multi-year Downtrend (green) and successfully post-breakout retested it into new support, enabling this strong move and transition into the final Macro Range ($3762-$4631, black-black) before new All Time Highs.

Zooming into the Weekly...

Price has historically upside wicked beyond this final major Weekly/Monthly resistance for 3 straight weeks in a row back in late 2021 and so it will be important for price to Weekly Close above post-breakout retest said level to go against the grain of history.

Obviously, best-case scenario would be for ETH to simply perform that bullish close and retest.

But it's important to understand the strength of this final major resistance before new All Time Highs:

Back in late 2021, ETH rejected from this major resistance into a -80% Bear Market.

If ETH is able to break resistance on this try, that would be a huge signal of strength; but in reality, more often than not, price tends to get rejected but in a shallower manner.

Thus, if a rejection does take place, it would make sense for price to drop to as low as the Macro Range Low of this final Macro Range, which could entail an -18% drop.

That sort of downside would actually satisfy the fulfilment of a Weekly CME Gap around the $4100-$4261 region (green), which is not very far from the Range Low of ~$3750 which could get reasonably tagged on a more volatile retest of the Weekly CME Gap.

It's clear that if ETH reclaims the final major Weekly resistance as new support, then Price Discovery will await.

But do major resistances, which have strongly rejected price in the past, give up without one last small bit of resistance?

Overall, Price Discovery for ETH seems to be simply a matter of time - does it breakout sooner or later?

How ETH treats $4631 over the coming days will be pivotal.