Altcoin have made some solid progress over the past few months despite the volatile market trends. After cashing out in March locked in huge profits, the market experienced a series of losses. However, since August and September, the trend has changed.
The market capitalization of Altcoin has surged from around $152 billion to nearly $170 billion, making higher lows, an important indicator of an uptrend.
The Altcoin has also started testing long-term moving averages, with a weekly close above the 100-day moving average (a difficult barrier to cross) potentially hinting at a move towards the 200-day range. If the Altcoin can break above this level, it would signal a promising market entry point with prices below previous highs.
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Will Altcoin perform better than Bitcoin?
One thing worth watching is how Altcoin perform compared to Bitcoin. While some may cheer Altcoin rising 20%, I think it is important to compare these returns to Bitcoin's performance. For example, Bitcoin may have risen 30-40% in the same period, so Altcoin must outperform Bitcoin to justify holding them.
Interestingly, the Altcoin/Bitcoin ratio has retreated back to June lows, which could signal a favorable accumulation range. Historically, this range has provided good opportunities for accumulation, especially when compared to previous highs in December 2023 and March 2024.
Meanwhile, total open interest (OI) for Altcoin, the total number of all unsettled derivatives contracts, has fallen 55% from its all-time high, a possible sign of reduced speculative activity and possible seller exhaustion. With fewer traders speculating on Altcoin, the market may be entering a more sustainable growth phase.
I believe that the decline in speculative trading could strengthen the Altcoin market, and the decline in open interest combined with the relative stability of Altcoin during the Bitcoin price decline suggests that Altcoin are accumulating sustained momentum.
Some Altcoin have shown strong resilience in the recent correction, and it is clear that their position in the market is solidifying. Regardless of the market direction, it is suggesting that the stage of Altcoin rally may be coming.
Popular Altcoin suffer setbacks
However, two of the most popular Altcoin, Ethereum and Solana, are showing signs of weakness. Ethereum is still working on launching an ETF, and its price has fallen to early August lows.
A recovery may occur, but it is still in a downtrend for now. Similarly, Solana, which performed well in 2023 and 2024, is also showing bearish signs, spending too much time near the 200-day moving average, which shows a lack of momentum. These Altcoin may face resistance, especially with internal pressure affecting their price action.
in conclusion
In summary, while Bitcoin’s dominance has historically been viewed as a barometer of crypto market strength, the recent performance of Altcoin suggests that investors are beginning to explore new investment strategies. As the market matures, this growing focus on Altcoin could signal a broad shift in investor behavior and lay the foundation for an upcoming Altcoin boom.
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