The Stae of the Alts – 01-19-23

The Global View

Top Left: Total Market Cap – Daily
Top Right: Total Excluding BTC – Daily
Bottom Left: Total Excluding BTC and ETH – Daily
Bottom Right: Total Market Cap – Others – Daily

The charts above represent the Market Cap of Crypto in four different ways. At first, we can see the total Market Cap of all of Crypto, and we can easily decipher if there is a trend up or down. From there, we move to the total Market Cap of all Altcoins (any coin that is not Bitcoin). The bottom two charts represent the entire Market Cap without Bitcoin and Ethereum, somewhat representing what the entire Altcoin market Cap looks like with the most significant player, Ethereum. The last chart is called Others, our closest representative of Shitcoins.

We are just over two weeks into the new year, and the market is drastically different than in 2022. Of course, this snapshot of 19 days doesn’t hold a candle to 365 days, but it’s a good start nonetheless. Last Thursday, we had some fascinating observations, especially the price push that exceeded the 20 and 50 EMAs for TOTAL. Let’s see what has happened since then.


Total Market Cap - (T - 125)

Description: Total Market Cap is the figure you get when you add up the market cap of all individual coins throughout crypto. This number comes with a disclaimer, as not every single crypto is included in this list. With over 20,000 unique token protocols, not everyone is legit. There are dead coins, scam coins, and irrelevant coins that are artificially propped up to maintain some market cap. This chart, in particular, is calculated by TradingView, and the Total Market Cap comprises the Top 125 coins on the market.

If you recalled, last week, the main target area after the initial breakthrough was the 200 EMA on the Daily. As we can see, after a very impressive seven straight day run-up, resistance was found at the 200 EMA. Not once, not twice, but currently, five failed attempts. This is the power of something like the 200 EMA. Traditionally, we would look for a pullback to the most logical level of support. The current most logical level of support is the 20 EMA, followed by the 50 EMA. However, one critical thing to point out here is that this recent high is still lower than the previous high in early November.


Total Excluding BTC

Description: This chart is the Total Market Cap but without Bitcoin. The reason for this is to get a gauge on where all the other money is in Crypto if it’s not in Bitcoin. The difference between the Total Market Cap and the one excluding Bitcoin can help you understand where Bitcoins’ Dominance comes from. If the chart above was half of the Total Market Cap, we could say that Bitcoins’ Dominance in the entire Cryptosphere is 50%.

Here we can see Bitcoin’s influence on the total market even by its absence in the data. The total without Bitcoin could not fully reach the 200 EMA as we saw with TOTAL, which includes Bitcoin in the dataset. We have a strong move nonetheless from Eth and company with a beautiful 20/50 EMA crossover to boot. Here we look for a touchback to the 20 or potentially the 50 EMA for support. Again, we remain lower than the previous lower high, which signifies we are still in a downtrend. 


Total Excluding BTC & ETH

Description: Just as the chart above excluded Bitcoin from the Total Market Cap, this chart excludes Bitcoin and Ethereum. Ethereum has made its stand for the Number One Altcoin and currently enjoys a 4X in Market Cap next to its closest competitor on the list. This chart removes the two most prominent players from Crypto and gives us a better idea of what the actual market is doing, regardless of what the two major players are up to.

Unfortunately, once we remove Bitcoin and Ethereum, the market shows much more weakness. TOTAL3 is currently still struggling with the current resistance zone. The resistance came from the zone’s top as two days nearly touched the top level. The pullback has already begun, and TOTAL3 is very close to testing its 20 EMA. TOTAL3 would need to find support and springboard out of that zone and try to test the 200 EMA, where resistance will likely be found.


Market Cap - Others

Description: In keeping with TradingView’s tradition of removing coins from their Total Market Cap, OTHERS represents coins 11-125 by Market Cap. They essentially remove the Top 10 coins from their list of 125, and we are essentially left with the old Index we used for Midcaps. This does not precisely show us what mainstream Shitcoins are doing but rather the middle-of-the-road Mids that are fighting with each other to move up the list and breach the sacred T – 10.

OTHERS has performed well, given the circumstances. The 20/50 EMA crossover was smooth; the initial run-up was solid. What throws me off is the resistance area. Now, by and large, all these charts are exactly the same, minus the removal of some assets here and there, so its not completely crazy that they all take resistance on the same day, etc. That being said, they can outperform and underperform each other based on specific criteria. Regardless, OTHERS has a long way to go and a massive downward-sloping trendline to contend with just above its current location.


Top 30 by Market Cap

Here we can see the price action and trends of the Top 30 in Crypto by Market Cap. On the right-hand side of the picture, you can also see the Peak Gains from the last seven days.

Things have cooled off from last week, which is fine. The market consolidates after moves like this. Is the current resistance enough to turn this two-week rally around and continue to the downside, or is this simply the beginning of another cycle move? 

The Wrap Up

Contrary to Twitter and the thousands of talking heads out there, we prefer to analyze a lot of data daily. We take that data, zoom out, and keep our Bias in check the best we can. Humans will do human things from time to time.

Regarding the new ATH talk – it’s way too early and likely not a part of this move. 

Regarding an extended rally – it’s still in the works, and there is evidence to support further upside, but the confidence is low until we break and flip a few critical levels.

Regarding further continued downside – the jury is still out. A betting man would Short the 200 EMA on the Daily Bitcoin Chart upon initial contact after an extended period. However, that did not work out well in 2019 when Bitcoin ran from the low 3000s to $14K.


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