What’s in Store for August 2023

July was a bearish month for the cryptocurrency market, with most coins falling after their yearly highs in the beginning of the month.

The month of July was slightly better for altcoins than it was for Bitcoin (BTC), though there were some exceptions. With that in mind, BeInCrypto looks at the crypto predictions for the upcoming month of August.

Altcoins Will Continue Outperforming Bitcoin

The Bitcoin Dominance Rate (BTCD) has significantly risen since its low of 39% in September 2022. The increase gained momentum in February 2022, and the price broke above the resistance level of 48% shortly after.

This breakout was crucial because the resistance area had been in place for an extended period. Breaking such a long-term resistance level often leads to significant upward movements. As anticipated, BTCD reached a high of 52.20% in June.

Currently, there is no clear horizontal resistance ahead. However, there are signs suggesting a possible local top is in place.

Firstly, the weekly Relative Strength Index (RSI) is deeply within the overbought territory and is almost at a new all-time high. The RSI is a momentum indicator used by traders to assess whether a market is overbought or oversold, helping them decide whether to buy or sell an asset. Past instances of reaching these levels have resulted in sharp downward movements (red circle).

Secondly, BTCD faced rejection at the 0.382 Fibonacci retracement resistance level at 52% (red icon) Fibonacci retracement levels suggest that after a significant price movement in one direction, the price tends to partially retrace to a previous level before continuing in its original direction. A drop is ongoing since the end of June.

As a result, it’s possible that BTCD may continue decreasing back to the 48% level, which could then act as a support. If this happens, it will indicate that altcoins might outperform Bitcoin.

However, this prediction would become invalid if BTCD closes above 52% on a weekly basis. In that scenario, a sharp increase to the next important Fibonacci resistance at 60.33% would be more likely.

Ethereum (ETH) Will Increase by at Least 10% Against Bitcoin

The second crypto prediction has to do with the ETH/BTC pair. The pair has fallen since September 2022. While the decrease means that the trend is bearish, the move has also been contained inside a descending wedge. The descending wedge is considered a bullish pattern. Therefore, an eventual breakout from it is the most likely future price scenario.

Additionally, there are several other signs that point to a breakout being the most likely future price scenario.

ETH bounce at the wedge’s support line in the end of June (green icon). The bounce caused a reclaim of the 0.618 Fib retracement support level. Both these are considered bullish signs. The reclaim is especially important since the 0.618 Fib level often acts as the bottom is the decrease is corrective.

Next, the weekly RSI has generated bullish divergence (green line). This is an occurrence in which a momentum increase accompanies a price decrease.

This often leads to a significant upward movement, particularly when it occurs in a long-term timeframe such as the weekly one. If a breakout from the wedge occurs, the ETH price can move to the next resistance at ₿0.085.

Despite this bullish ETH/BTC price prediction, a decisive close below the support line of the descending wedge will mean that the trend is still bearish. In that case, the price will be expected to fall to the next support at ₿0.050.

Dogecoin (DOGE) Price Will Double

The final crypto prediction has to do with Dogecoin. The meme coin has fallen under a descending resistance line since its all-time high in May 2021. The resistance line was in place for 805 days.

The DOGE price finally broke out from the line last week. Breakouts from such long-term structures usually lead to a pronounced upward movement, since they mean that the previous correction has ended. While the DOGE price has yet to begin this rapid increase, it has gradually moved upwards since the aforementioned breakout.

Next, the weekly RSI has just moved above 50, the first time it has done so since October 2022.

The next important resistance area is at $0.16, an increase of 100% from the current price. Due to the long-term breakout and lack of overhead resistance, it is possible that the DOGE price will reach this level.

Despite this bullish DOGE price prediction, failure to sustain the increase could lead to a drop to the 0.060 horizontal support area, a decrease of 22% measuring from the current price.

For BeInCrypto’s latest crypto market analysis, click here.