Altcoin Market Signals Major Breakout Amid Structural Retest

• Altcoins break a long-term downtrend, testing support at a key retest zone that could determine the next major move.
• RSI signals weakening momentum, but if it stabilizes at trendline support, buyers may regain control for a potential rally.
• A breakdown below support could lead to further downside, while holding above may trigger a strong bullish continuation.

Following an important retest, the altcoin market flashed a buy signal, indicating a possible breakout. With the exception of Bitcoin and Ethereum, the total market value of altcoins is presently $891.18 billion. This adds $21.34 billion to the market, or a 2.45% gain. The market is currently in a corrective phase after recently emerging from a protracted downward trend. Whether support holds or sellers drive prices lower will determine the next move.

Key Technical Analysis Insights

Lower highs and lower lows characterized the last drop in the altcoin market. However, a strong breakout above the declining trendline initiated a powerful uptrend that saw price action surge well past key resistance levels to form a new peak.

After hitting a fresh high, the market faced rejection and entered a pullback. The current price action is testing a previously broken resistance, now acting as support. This area, highlighted by a horizontal support region, is a critical retest zone. Historical data shows that similar retests resulted in strong rebounds. Hence, this level could dictate the market’s next move.

Momentum Indicators and Market Sentiment

The Relative Strength Index (RSI) is currently neutral after an earlier breakout above a descending trendline. However, it has turned downward, indicating waning bullish momentum. The RSI also approaches a dotted trendline, which previously acted as resistance but could now serve as support.

If the RSI stabilizes above this level, buyers may regain control, pushing prices higher. Conversely, a failure to hold could trigger a deeper correction. Consequently, market participants must closely monitor RSI movements in the coming sessions.

What Lies Ahead for Altcoins?

The trend is bullish after breaking out of a prolonged downtrend. However, the market is now at a crucial juncture. If support holds at the current retest zone, a renewed rally could drive prices higher. Besides, past reactions suggest a strong probability of upward continuation. 

On the other hand, a breakdown below this level may invite further downside pressure. Sellers could push prices lower, potentially revisiting previous support zones. Analyst Mikybull Crypto emphasizes that the market is in a decisive phase. Moreover, upcoming developments in global market conditions could further influence the trajectory of altcoins.