The State of the Alts – 02-27-22

The Global View

Top Left: Bitcoin Dominance – Daily
Top Right: Altcoin Index – Daily
Bottom Left: Midcap Index – Daily
Bottom Right: Shitcoin Index – Daily

Above, we can see a snapshot of the entire Crypto market broken down into four very specific charts.  The overall Bitcoin Dominance chart shows you how much of the total market cap belongs to Bitcoin and therefore it also tells you how much of the market belongs to Altcoins.

Amazing what a few days can do for the morale of the market. For context, it’s Earning Season in the traditional market, and that helps to add some attention to traders all over the world as they try to gauge what sectors are profitable and what sectors are trending down. With crypto, we deal with something caller correlation. This is often comparing Bitcoin to Gold and seeing if they are moving in the same direction or not. 

Altcoin Index

Description: Each asset in the Altcoin Index is weighted the same.  This gives a good look at a basket of higher profile and higher MCAP coins. 

Last Friday we got a little bounce after falling for three days but it’s what happened on Tuesday that got the market humming. Tuesday brought in a decisive breakout of the 20 and 50 EMA in a single candle for the Majors Index. This helped to propel the price over the local resistance and close above it on the following day. This was enough to push Ethereum, Bitcoin and basically, every T-10 coins to currently hold a positive value for their 7-day rolling period. With the local trend flipping into a rally, we look ahead to the next major resistance area, which is the 200 EMA on the Daily. This breakout/retest is also very fresh and waiting a few days for confirmation will take patience but it will help to avoid and false-breaks.

Midcap Index

Description: This is the playground for most traders.  It’s widely excepted that the top tier Crypto has already made most of their explosive moves, but that is not the case in the land of the Mids.  The Mids make a wide variety of projects from L1s like Algorand to ad-seeking marketing like BAT.

The Mids also faired very well this last week. They performed only exactly the same as the ALTs in regard to breaking both the 20 and 50 EMAs, as well as maintaining their local support uptrend line. ALGO, ATOM, and DOGE really showed up and took a lot of fresh capital in their system. Just as with the ALTs, the next major step if we are to continue with this upward momentum is the Daily 200 EMA.

Shitcoin Index

Description: What market in the world can you label a basket of assets and call them SHIT?  Only Crypto, baby!  The SHITperp is your view through the window of our beloved Shitcoins.  These represent 50 coins that have a relatively low market cap but still have stand-out projects.  Coins like MANA, in and of themselves, is actually a great project with a bright future but their market cap deems them as Shit.  THETA, CHZ, ENJ, HBAR, ZEN, etc.  These projects are actually good projects with good fundamentals, so they skew the balance sheet a bit because these are not exactly the Shitcoins that some other people talk about when they talk about Shitcoins!

ShitPERP is looking good! We haven’t been able to say that for a very long time and it may not exactly be 100% accurate. SHIT struggled with its 50 EMA, unlike its two older Brothers. Where ALTs and MIDs overcame their local trend and their 50 EMA, SHIT failed BUT, that being said, SHIT is holding its 20 EMA and continues to trade above its much larger downward-sloping trendline. The big deal here is that SHIT was able to finally break over its local downtrend resistance. That happened on Sunday. SHIT has been lagging behind MIDs and ALTs for quite awhile now, so it is not too surprising that they have yet to push their 50 EMA as the others did. We look for a break and confirmation of the 50 EMA inside of this week if we see a continuation of momentum to the high-side.

Weekly Movers

Yes, there is plenty of red and for good reason, we are still very much in a downtrend. However, the first signs of life are starting to crop up and that is something to take notice of. ETH and MATIC are two to keep an eye on for the next few weeks, especially if we start to see some continuation and ease of the selling pressure.


The Wrap Up

Everyone loves to see some Green. Historically, October has been known to start some rather exciting trends but we are far too early to be calling those shots. Day by day and keep zooming out. That is the way to make sure you don’t get sucked into the hype and the FOMO. 

If sell pressure eases up and fresh capital comes into the market, there is a chance we see a rally. A rally and a reversal are two very different things as not all rallies turn into reversals but all reversals are indeed reversals.


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