The recent “altcoin season “unfolding over the past few days as Bitcoin is trending, has traders” cautious “about what could happen. As for what may be in the offing that scares crypto traders so much, a altcoin-LED blowing off top that sends crypto back into the short term lows bear phase.
Here are the unique market factors that may give the crypto market cause to proceed with caution.
Cautious Crypto Trader: Beware of Potential Blow-Off Stop in Alts
Bitcoin is now trading for $ 35,000 after creation another attempt to push above USD 40,000 yesterday. Candles of $ 5,000 a day in both directions are now the norm in cryptocurrency trading, but that’s not what shocked some top analysts and traders at the recent price action.
Related reading | The striking similarities between the Bitcoin peak of 2017 and now
Since the peak of the 2017 bull market, crypto investors have been waiting for one altcoin season to bring huge profits again in a few days. Life-changing wealth was generated, which was then lost as quickly as it arrived.
The spark to get this started should have been Bitcoin passes $ 20,000 But that achievement came and went, and only now altcoins are popping up as Bitcoin starts to decline. It has a top crypto trader who is “cautious” about a possible “blow-off top” in altcoins. And here’s why.
Chainlink and Polkadot are beginning to eclipse Bitcoin | Source: BTCUSD on TradingView.com
Altcoin Season as BTC has marked Drops past Crypto Market Tops
Crypto trader Johnny Moe is approaching the current price action in crypto, and with good reason. Bitcoin is on the decline, while altcoins are on the rise. Polkadot won 75% in two days and Chainlink has just hit a new record.
Bitcoin and altcoins tend to rise together, the handful of times the two asset types diverged, it indicated that there was a top in it. Altcoins recently rallied alongside Bitcoin as it pushed above USD 40,000 and hit new all-time highs, but the latest rally in altcoins is happening as the leading cryptocurrency by market cap moves down.
Bitcoin’s $ 40,000 rejection recently marks the first all-time low in the daily timeframes in months, and if a lower low is entered, the cryptocurrency will by definition entered a downward trend. Altcoin price action that continues to fly as Bitcoin dives could be a rerun of the conditions that caused the 2017 spike.
Related reading | Capital Manager: Ethereum will double in two weeks once ATH breaks
If this is indeed the top, it could be bad for Bitcoin, but altcoins could still have two weeks links of momentum and profit before the blow-off peak is complete and the rest of the crypto market turns around.
Is this trader right to be careful? Or is bear market PTSD to get the best of them, and this latest “downtrend” is just another chance to buy the dip?
Featured image from Pixabay, Charts from TradingView.com