According to blockchain analytics firm CryptoQuant, there are fresh signs that the crypto market may be shaking off its recent slump and entering the early stages of recovery.
Analyst Axel Adler Jr. highlighted a key technical development that could signal the end of the downward momentum that’s been weighing on prices since late July.
Adler explained that the 120-day simple moving average (SMA-120) — a widely used gauge for short-term market direction — has finally pivoted upward after an extended decline. Even more importantly, it has reached the “zero axis,” a level often seen as a dividing line between bearish and bullish territory.
This shift is notable because a similar move occurred last week but failed to gain traction, with the SMA-120 quickly sliding back down. This time, however, Adler says the chart looks much healthier, hinting at stronger underlying support from buyers. If the indicator can hold above the zero axis for the next couple of days, it would serve as technical confirmation of a trend reversal.
Such a confirmation could help restore confidence among traders who have been cautious after weeks of price weakness. Historically, similar SMA-120 breakouts have marked the start of multi-week rallies, though Adler cautions that no single signal guarantees sustained gains.
Beyond technicals, improving sentiment could also be supported by macroeconomic factors in the weeks ahead, including the possibility of more favorable monetary policy shifts. If these align with the current chart setup, the combination could give the market the push it needs to build upward momentum through the remainder of the quarter.
The information provided in this article is for informational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/crypto-market-shows-first-strong-signs-of-recovery-after-weeks-of-pressure/