The State of the Alts – 06-24-22

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.

Well. the market was so hot yesterday that we needed to wait another day before writing the State of the Alts so we had a more clear picture on what the rest of the coming week may have in store for us.  The good news is that we are seeing a relief The bad news is that it may be short-lived.  

The trickiest part about reversals is not getting fooled into longing a suckers rally.  This means that time and patience should both be exercised to make sure you have the confluence and confirmation you need before trading against the market because, at the end of the day, we are very much in a downtrend.

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. 

After suffering nearly a 40% drop in only a few days, the Altperp is showing signs of relief.  This particular relief is currently at the 20 EMA on the Daily where it has repeatedly found resistance since last November.  The trick here is to understand the levels associated with the averages.  Even after the 20, we have the 50 and in-between the 50 and the 200 – we have a really good horizontal level of resistance.  Breaking that level is key for confluence.  Anything before that can be considered very risky for the Major Alts.

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.

The Midcaps take the crown for largest drop from recent ATHs compared to Alts and Shitcoins, sitting at 86% down.  The good news here is that historically speaking – 85-88% is actually a great area for bottoming out, the bad news is we can still drop another 50% from here and it would only change the 86% to a 90% drop from ATH.  The reality is that support is actually 50% from here – that would be the bottom of that green horizontal zone that has yet to be tested.  The good news is that the low we have received so far was the high retested from back in November of 2020.

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!

Shitcoins look a lot like Midcaps at the moment.  They showed resistance at the 20 EMA at closing yesterday but so far today that have crossed the threshold and they continue to rise.  We are seeing some coins put in double-digit gains over the last 24-hours and they too are testing some key levels and are coming into some important resistance.  Once again, too early to tell for all of these as they are still well under major resistance – resistance that would need to be flipped to Support in order to have a sense of confidence to long this particular market.

Weekly Movers

Short timeframes up to the H1 on all the T-25 coins are showing strong upward trends.  This is due to the multiple days of double-digit gains and the 5 of the last 6 days of upward movement so far.  It has been a long time since we have even seen green anywhere on the PAS – but again, don’t get sucked in just yet.  Look for key levels to break, look for key trendlines to break and look for confluence before attempting to counter-trend trade this market.

The Wrap Up

It is amazing how easily someone can sway their opinion on the market.  Within a 1-hour pump candle someone can go from throwing their computer out of the window to asking a co-worker to borrow money so he can buy some more shitcoins.  This is pinnacle behavior for an irrational market.  Stay calm, stay focused and stay true to your trading plan.  There is no reason to get FOMO now just because we have a few days up.  Let the current action prove itself and show you confidence and confluence before making any trading decisions.

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