As a seasoned researcher with a decade of experience in the dynamic world of cryptocurrencies, I can’t help but feel a sense of excitement and anticipation as I delve into the current state of altcoins. The recent dip in Bitcoin price has undoubtedly shaken the market, but it also presents an opportunity for altcoins to make a historic rebound.
In the early hours of Wednesday, altcoins suffered significant setbacks when Bitcoin‘s price fell below its $60,000 support threshold. This caused the overall crypto market value to decrease by 6.7%. Many altcoins experienced losses in double digits. However, some tokens have hinted at a potential rebound due to increased whale activity, which has given investors an incentive to sell their assets and acquire more of these promising tokens.
Altcoins Prepare for Historic Rebound
According to the Alts Buy Signal from Dune Analytics, it appears altcoins are poised for significant growth. The last time Bitcoin showed a similar reading on this indicator was back in summer 2020, when its value hovered around 10%. Over the subsequent six months, Bitcoin’s price skyrocketed from $10,000 to an impressive $69,000.
Currently, altcoins are sitting at a similar level and seem poised to surpass the 10% threshold. Is it possible that this could initiate the most monumental rally of altcoins ever recorded?
Furthermore, the Global Macro Investor’s data indicates that altcoins have generally performed better over time compared to traditional periods. However, in the early to mid-2019, altcoins dipped below 10% (oversold). Starting from this low point, altcoins outperformed until early 2020. Afterward, they started consolidating and eventually peaked in mid-2020.
In simpler terms, it’s possible that the pattern observed earlier with altcoins (cryptocurrencies other than Bitcoin) might reoccur. They hit their lowest points around early to mid-2023 and peaked in early 2024. At this point, it seems like altcoins could be preparing for a period of stability or slow growth before they potentially surge ahead later in the year.
Currently, the Tether printing machine continues to operate, with a total USDT minted in the last week amounting to approximately $744 million. Over the course of 2024, this figure has swelled by an impressive $26.5 billion, adding significantly to the circulating supply. With more liquidity available, there’s a higher likelihood that the price will surge.
Bitcoin Dominance Still Reigns Supreme Over Alts
Although bitcoin’s price has dropped recently, alternative cryptocurrencies have found it challenging to surpass bitcoin, as its dominance has grown by 0.85% over the past week. A chart depicting Bitcoin Dominance suggests that a cup and handle pattern is emerging, which could potentially push it up to 59%. Such an increase would significantly impact altcoins negatively.
The total altcoin market cap is still trending below the Bitcoin market cap. Additionally, although BTC and altcoins have lost value today, the latter shed more than the former.
In the past day, the graph showing the comparison of BTC and altcoin market capitalizations indicates a 16.68% decline for altcoins, whereas Bitcoin experienced a smaller loss of 9.94%. This disparity could be the reason behind the rise in Bitcoin’s dominance, even with falling prices.
In a nutshell, these findings suggest that alts might experience an upward trend. The total market value of altcoins is well-supported at the $850 billion mark, which could serve as a launching pad to propel further gains.
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2024-08-28 15:42