The State of the Alts – 02-23-23

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 biggest player, Ethereum. The last chart is called Others, which would be our closest representative of Shitcoins.

Alright Crypto fans, there is some magic (potentially) in the air and I’ll get into all that in just a few minutes. Beginning in January, the market has been making moves to position itself as “not dead”. This is no easy task when you have spent 13 months selling off every bullish candle and every multi-day/week/month rally. To be fair, we saw something similar last June – it failed. Then we almost got going in late October – that also failed. And so here we are again but with a twist… Let me explain.


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 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 artificially propped up to maintain some type of market cap. This chart, in particular, is calculated by TradingView, and the Total Market Cap comprises the Top 125 coins on the market.

Our story starts here, with TOTAL. The small Orange Line represents the previous downtrend Lower-High. This is a crucial level as it invalidates the previous downtrends efforts for further downside. In other words, the Bears could not prevent the level from getting beaten. The initial surge to this level was rejected for about three weeks. This further solidifies that it’s a significant level. That level has now been smashed and properly retested as Support.

The story doesn’t end there tho, though there’s more. TOTAL was able to ride the 20 EMA until its first major pullback, which conveniently used the 50 EMA as perfect Support. This adds strength to the local trend. On top of all that, the 50 EMA has just barely crossed over the 200 EMA. There does need to be a close to confirm the crossover, but the 50 over the 200 is called the Golden Cross. Some consider this as the beginning of an upward-trending market.


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%.

And all of that leads us to TOTAL2. The rest of the market without Bitcoin. As we can see, the same Lower High respective to this chart is still causing rejection. This means that Bitcoin is absolutely helping regarding the entire market, and Alts by themselves are struggling to achieve the same success. All hope is not lost though; more like Alts are delayed by a few weeks. TOTAL2 suffered the same pullback and found support on the 50 EMA Daily. So, if all continues, we expect to see the TOTAL chart play out on TOTAL2 in time.


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 biggest 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.

TOTAL3 is even further removed from TOTAL and TOTAL2. This tells the story that ETH is playing a big part in moving Alts around. TOTAL3 does have the 20/200 crossover, which is a huge first step, and it also has the support from the 50 EMA, but it has failed even to reach the downtrends Lower High, meaning it is still technically in a validated downtrend. This does not instill confidence in investors regarding a basket of Alts from Ranks 3-125. Of course, a few will always slip out of the cracks, as we have already seen, but the overall health of Alts has not proven itself just yet.


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 remove the Top 10 coins from their list of 125, and we are 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 fighting to move up the list and breach the sacred T-10.

OTHERS is looking just like TOTAL3 at the moment, which, if you remember, was lagging for a long time behind the other three charts. The significance of OTHERS also to be crossing its 200 EMA, finding support from the 50 EMA, and finding rejection from the trends previous Lower High means that OTHERS has caught back up to the rest of the market. Significant moves can be expected from Shitcoins while blue chips pump for this very reason. Overall, sharing these major moves with the more prominent players is a massive victory for OTHERS.


The Wrap Up

Overall, there is much to like here if you are looking for a change from the year+ downtrend. These are early signs of life and potential reversals. The market is Bullish just yet, but the signs we see today are the first steps every bullish market needs to go through at one point or another. 

There are certainly opportunities out there at the moment, but without the support of the entire market, they will be few and far between. That said, always keep your ear to the floor for something bucking the overall market and trying to lead the way.


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