The State of the Alts – 03-10-22

STATE OF THE ALTs 10-3-2022

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.

Another wild week in the market has left us with another week of data to unravel.  The War in Ukraine lingers on while new Executive Orders from the United States had the Crypto World on edge.  All this action led to a quick rise and a quick fall in all the major assets and at the same time, Bitcoin has seen it’s Dominance steadily rise.  

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. 

Triple failure from the 50 EMA is proving to be a bit of a disaster for the greater Altcoin Index.  We are currently on Day 7 under the 20 EMA after losing it as support a week ago.  Although the longer term trendline was broke a month ago, major Alts have failed to do anything impressive over the last 30 days.  In fact, LUNA is the only asset in the Top 25 that is positive over the last 30 days.  Top-10 30-Day losses range from a low of %10 for Bitcoin to a high of 32% for ADA.

Midcap Index

Description: This is the playground for most traders.  It’s widely excepted that the top tier Crypto have 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 L1’s like Algorand to ad seeking marketing like BAT.

Midcaps are performing just as bad as the majors when it comes to the overall index.  Just like the Altcoin Index, the Midcap Index has suffered three rejections from the 50 EMA in the last month and is also experiencing its 7th day in a row under the 20 EMA.  Midcaps have found support on it’s historical levels where the Altcoin Index has yet to reach in comparison.  Nonetheless, fairly bleak outlook for Midcaps until they can at least slow the downtrend pressure and try to ease the pain.

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 relatively low market cap but still have stand out projects.  Coins like MANA, in and of itself is actually a great project with a bright future but its market cap deems it 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!

About the only asset holding up this chart is WAVES at the moment.  Outside of that, it’s just as bad as the Altcoin and Midcap Indexes.  We do actually have a fresh breakout of the trendline here and there is some short-term love with the 20 EMA but once again, failure at the 50 EMA three times in a row is not a very Bullish look.  Shitcoins would need a few decent rallies in order to start reversing course on this 4-Month selloff.

Weekly Movers

Although the overall indexes don’t look very appealing, there are a few coins trying to make a name for themselves during the downtrend.  We mentioned LUNA before and she has essentially been one of the stars of the show.  The picture above shows what is strongly trending on the H4 timeframe as that is a good indicator for something that has been trending for a potential continuation to the high side as opposed to the downside.  WAVES and LUNA are about the only two worth consideration given their trading Volume as all the rest can too easily be manipulated by even the smallest of whales.

What to Watch

Let’s take a quick look at LUNA and WAVES as they have good volume over the last week and show some promise of reversing the overall downtrend.

LUNA/USDT:

Last week we talked about LUNA coming back to $82 after taking overhead resistance from an internal trendline.  LUNA did one better and not only hit $82 but came down to the single pullback that created a sandwich on the way up.  The entry there was $78.  Regardless, either entry was a good entry and LUNA has gone on to actually create a new ATH.  We still have a high side potential target of $113 and the current momentum looks like it can actually support that move.

WAVES/USDT:

WAVES is looking very interesting at the moment.  There are a few ways this can play out and that is why there are a few different measurements.  WAVES has seen an increase in momentum, an increase in Volume and an overall increase in price.  This could lead to a shallow pullback overall.  We can see $24.50 getting retested before a significant move, $22.50 before a big move and even as low as $18.50 before a significant move.  The really interesting thing here is that there is a lot of room to go if WAVES is looking to retest its previous ATH.

The Wrap Up

Maybe a relief?  If LUNA and WAVES are early to the relief game then we could actually be in for quite a surprise in the next few weeks.  Overall, the market is trash.  The downward spiral is unrelenting and every push just leads to further lows  -HOWEVER – it can’t go down forever.  LUNA and WAVES both prove that not only can some Alts decouple from Bitcoin, they can go on to retest significant levels as well as go on to retest previous ATHs.  

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