RealVision’s chief crypto analyst Jamie Coutts shared his insights on the current crypto market downturn, hinting at a potential bullish shift based on technical indicators.

What Happened: In a detailed thread of X, Coutts highlighted a 55% pullback of the top 200 cryptocurrencies equally weighed over the past six months.

He noted that despite the downtrend, the risk/reward ratio is favorable for adding to select assets at these levels. Coutts also pointed out a sharp move higher on the altseason indicator, suggesting a potential end to the bearish thrust.

He further explained that a return to a bullish regime could be indicated when more than 45% of assets trade above their 200-day moving average. Currently, only 11% of assets are above this mark.

Coutts believes that traders will need the price to break out of downtrends, but for allocators, current price levels are desirable to add as the risk/reward is favorable.

Also Read: Bitcoin Is In For A ‘Massive Bull Run’ If This 2020 Pattern Repeats, Analyst Says

Why It Matters: Coutts’ analysis contrasts the last months of persistent sideways trading. The analyst sees early signs of a potential reversal, similar to that in Q3 2023.

He also emphasized the role of liquidity in driving the market, stating that it has now turned decisively bullish and is likely to push Bitcoin (CRYPTO: BTC) higher.

Despite the price decline over the past six months, key crypto ecosystem fundamental metrics have performed well, with addresses up by 73% and rising transactions.

While acknowledging the current bearish price action, Coutts suggested that the final throes of the big flush of the past months could make Q4 critical for 12-month forward returns for allocators.

What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.

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