Altcoins
These Altcoins Show the Most Bullish and Bearish Divergences: Santiment
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Analytics firm Santiment has revealed the list of altcoins that currently have the largest bullish and bearish divergences.
RSI Reveals These Altcoins Currently Contain the Most Extreme Values
In a new job on Relative Strength Index (RSI) Currently.
RSI refers to a measure of momentum in technical analysis that tracks the speed and magnitude of recent changes in the price of a given asset. This measurement can be made on any time frame, but in the context of the current topic, the 1-day RSI is relevant.
Generally, a high value of this indicator can be a sign that the asset is currently overheated and at risk of forming a top. More precisely, the 70 mark is chosen as the threshold when the probability of a bearish reversal becomes significant.
On the other hand, an RSI at or below 30 may imply that the price is currently below its fair value and, therefore, a potential upside reversal could be brewing for the asset.
Now here is the chart shared by the analytics company that shows the 1-day RSI trend for a few different altcoins from the top 150 market cap list over the past year:
Looks like three of these coins have a low value of the metric, while the other three are at high levels | Source: Santiment on X
As seen in the chart above, the 1-day RSI has recently reached high levels for Maker (MKR), Venus (vBNB), and Sei (SEI). To be more precise, the metric has a value of 74.6, 72.4 and 75 for vBNB, SEI and MKR, respectively.
Clearly, these RSI levels are in the zone typically associated with an overheated market. Maker recently benefited from a strong recovery, seeing gains of over 30% over the past two weeks. However, if this measure is anything to go by, the asset’s strong run may be coming to an end.
On the other end of the spectrum are altcoins Elrond (ELGD), Arweave (AR), and Bonk (BONK), which are seeing low 1-day RSI levels. ELGD and AR are in the undervalued zone with metrics located at 22.6 and 29, while the SolanaThe memecoin BONK, based on the memecoin, is floating just above the zone with a value of 31.
According to Santiment, these six coins have also separated from the rest of the altcoin cohort, implying that a bearish/bullish divergence (depending on whether they are overvalued or undervalued) could be forming for them.
As such, coins like BONK observing a bullish divergence could see their price rise, so they can catch up with other alts. Likewise, MKR and others could see a correction to be more in line with the rest of the market.
BONK Price
Bonk has had a rough patch in recent weeks as its price has been on an overall downward trajectory. However, the coin may finally start to recover, as its price has surged by over 22% in the past 24 hours.
The price of the coin seems to have jumped over the past day | Source: BONKUSD on TradingView
Featured image from iStock.com, charts from TradingView.com, Santiment.net