Altcoins Vs. Bitcoin - When Will The Alt Season Start?
When Will The Alt Season Start?
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All markets are moving in cycles and the better we understand them, the better we can make judgements accordingly. Many of you hold altcoins and I know the pain seeing them go down in price everyday. I learned a lot from experiencing the big crash in 2014 and was stuck in many shitcoins that had little to no value at all. Today, I try to only invest in projects that have a product or great team/idea that can pull it off. I have been playing around with shitcoins as well just out of pure speculation and swing trading. I've gladly sold many on the peak but still try to get rid of most of them after realising what the future could look like.
If we look at the Coinmarketcap Altcoins vs Bitcoin market cap, we can see that we're pretty much in the same situation as we were last summer when altcoins peaked both in price and volume. After that, Bitcoin started crushing it and many alts saw a decline up to 90%. That's a tough spot to be in and I want to avoid getting there.
I'm gonna give you 3 reasons why I think that Altcoins will have a tough time the coming months. Remember, these shakeouts and corrections are needed to reach new highs and I look forward to the next bullrun. Until then, I will try to accumulate as much fiat as I can and pick up cheap coins along the way. My main strategy right now will be to increase my BTC % and also to buy more by dollar cost averaging.
3 reasons why altcoins could suffer
- Bitcoin will continue it's correction (please check my previous analyses). If Bitcoin drops, altcoins follow.
- If Bitcoin has found the bottom and is on it's way up, altcoins will have a hard time to follow, just like last fall/winter.
- Marketcap is showing signs of Bitcoin gaining dominance again just like last summer and we all know what happened after that.
Coinmarket cap Altcoins vs Bitcoin
We can see that altcoins had a peak in market cap vs Bitcoin in feb and that it's declining as Bitcoin is gaining strength.
Cup and handles
I've analyzed a few popular coins that all show the same patterns. They all formed cup and handle patterns during the long correction phase and I see similarities looking at todays charts. Cup and handle is a very bullish sign but it's also painful to experience if you're in the middle of it. It usually results in an explosion in price and the best spot to buy is where it's curling up slowly, or at the end of the handle.
STEEM
Bitshares (BTS)
Ripple (XRP)
DOGE
Here are a few coins that could be forming cup and handle patterns due to the coming correction phase:
ZRX
Ripple (XRP)
Verge (XVG)
Please let me hear your thoughts on this. I would gladly talk more about this macro perspective of cryptos since it will form my overall plan.
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Disclaimer:
I'm not a financial advisor and these are only my opinions. I don't take any responsibility for any investments that you make based on my analysis.
First it is the dawn of Bitcoin
I think late March & April will be great months for alts. A lot of industry changing projects will be introduced (tez0s, wanchain etc.) and various main-nets launching.
I actually think the re-rise of alts is not happening that soon as people expect/want to expect..Portfolios of many people went down easily by 70% and that's something human subconscious mind will remeber for quite some time..not important that people believe in the those alts of their choice....if they already sold for btc/fiat, they are not buying back any time soon I guess...the horror of January is still too fresh in people's minds.... time heals everything , so I'm sure alts rise once again...but not in the upcoming months I guess...Im not a trader though
:D Average crypto portfolio in December 2017 vs February 2018:
Good one! Agree
the real problem is that I have alt coins that are at or near the Jan lows, but BTC is around 10k, so BTC has been fine but the alt coins never recovered at all, some are actually hitting new lows like ADA, IOTA, VIBE, SUB.....the alt coins crashed and are now crashing again, nothing good has happened in the past 4 months...it's all looking like a scam right now
Hahh Im also holding ADA and SUB...it hurts but whatever...
ADA needs time, it shouldn't be as high as it is anyway, I just don't want to sell it cuz you never know when people will start going crazy again...and I don't want to lose any of it since it has a bright future IMO.
and SUB - it's just a sad story, I'm a big fan of an idea of the project, but Justin (CEO) is absolutely unprofessional and missing Beta by 3 months (as of writing) is just crazy....don't want to sell it because I like their anti-censorship vision so I want to support them...but not really sure if it will ever recover, especially since the goal they are taking on is sooo big. It might happen that their ER20 token dies and they'll roll out fully functional SubstratumNode in couple of years with some other type of paying hosts for their computing power and hosting. I'll still be a host though - like the idea of it.
Best of luck to you!
Most coins are overvalued and will need time to catch up again. Coins with good teams and ideas/products are here to stay. Just hodl.
Interesting read. I read and write on btc loosing it's strong hold on volume of trade consistently and on issues of taxation. See my last two posts for the articles. My question is, do you think based on btc high transaction costs & delays will keep leading in volume? Nice post
Gonna check them out! I haven't really thought about the correlation of high transaction cost vs price movements but what I do believe is that as soon as it get easier for people to buy other alternatives to bitcoin, it will lose a lot of market share.
And the market share is going down by the day with ether a big threat a d after smt steem will take a huge chunk plus eos and bitshares eyeing their own chunk. By end of the year, we see competition rising. Blockchain tech is hugely beneficial even to refugees . I updated on how Finland is using blockchain to address refugee issues. Take a look.
Great analysis!
I had started to notice that these days when BTC goes up, ALTs remain stable, but when BTC falls, ALTs crash. That effect makes alts fall continuously. Your graphical analysis confirms this feeling.
Your comparative chart is really useful. when the BTC vs ALTs is high, buy alts, when Alts are high vs BTC convert to BTC. I will definitely look at the BTC dominance indicator more seriously from now on.
I missed the BTC bottom at 4 kiloEuros, because the FIAT I had sent to my BTC broker took a few days to arrive... so now I have the FIAT just on standby. According to your graphical analysis, I believe I should wait a few months, become close to the bottom of the alts, and then buy some. Maybe do it progressively, by pack of 25%.
Then during the next bullrun, maybe this summer, where Alts increase faster than BTC, sell them for BTC.
I'll think about that. Looks like a plan,
Thanks for sharing your views: this was one of the most pertinent analysis I have seen in a very long time.
Thanks, let's see how this turns out. That's gonna be my plan too. It's good to use these tools to get a clearer picture on a macro level. It elimenates the FOMO and makes it easier to find the dips imo.
Nice presentation of reports
Thanks!
I think BTC is just getting started and is probably the best place to be!!
Nice H&S! We got to factor in that Bitcoin is the main coin that everyone knows and starts to purchase to buy into all the alt coins. We notice how Ether started to rise in price and market cap when Coinbase and other USD regulated exchanges started to list it. Same as for Litecoin, etc... I believe Bitcoin will one day become like a novelty coin and loose it's power compared to some alt coins in the coming future once other coins get regulated and mass adopted for legal trade via fiat. By these graphs you can really see that Bitcoin goes up alt coins go down and vice versa due to this theory. It's just a matter of time as well as regulations that some of these alt coins and their superior blockchain technology replace the big ฿east. I'm going to continue to HODL alts that have purpose such as Civic, IOTA, ADA, EOS, ETH, XRP, POT, ART, STEEM, etc... and hope soon the that all the sh!tcoins that can't do nothing RIP. They're what's slowing down the growth and mass adoption. Kudos on the well done econometrics and I'll be following as well 1uping.
Agree 100%, I have that mindset too. Only hodl something that can bring value, or that I can actually use, like steem, bat etc.
but for me as a soft toy who likes to hold bitcoins I can only say that altcoins retard the growth of bitcoins but it is unstoppable. Less to carry for me at first;)
Bitcoin ia real