The State of the Alts – 07-15-22

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.

Welcome to the very definition of a Choppy Market!  Some days are up, some days are down.  The trend is no longer very clearly dominating to the South.  Don’t get it twisted though, we are still very much in a down market but even down markets have periods of sideways consolidation where the violent moves to the downside have subsided and the overall market appears to be quieter.  These are the times when a few seemingly random tokens will start to move… stay tuned below.

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. 

ALTPERP once again finds itself struggling with the Daily 20 EMA.  This is a recurring theme and one that adds significance once it is broken and flipped propper.  An example of a good break was back in Mid March, but it never really flipped the 20 EMA; it broke it and then failed on the first retest after the 20/50 crossover.  Now we wait to see if the current move has enough momentum to swing more alts North.

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 Mids are playing the same game as the major Alts in ALTPERP.  The difference here is that an initial break of the 20 EMA is no longer exciting as the Mids have an easier time manipulating that moving average.  Instead, we really need to see the 20 cross over the 50 and the 20 or 50 to be tested as actual support.  This does leave the door open for a few Mids to pump while the rest stay somewhat flat.

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 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!

SHIT moved yesterday and was able to close above the Daily 20 EMA.  However, SHIT is very similar to MIDS in regards to making believers out of this price action something that needs more concrete evidence.  Too many previous failures from breaking the 20 EMA has traders on edge until they see something a little more convincing.  The good news is that when the market runs sideways long enough, the 20 and 50 tend to share similar levels.  The 50 EMA is now extremely close to the 20 EMA and that makes it far more attainable than it has been for the last few months.

Weekly Movers

We are back in a low timeframe trend reversal situation again for the T-30 coins.  As mentioned before, this is the thing about choppy markets – we’ll have a few good days in a row that will trigger the short timeframe reversal story, and then we have a few days in a row selling all the recent gains off and killing the narrative that a reversal is likely.  Sideways markets are not easy to trade in unless you have a strategy that works very well on very low timeframes.  Scalpers love a market like this!

What to Watch

VGX/USDT:

VGX has seen some recent success on the lower timeframes and has also broken a very long trendline.  Although it may look small relative to the entire chart but the other day VGX pushed for over 627% in a single day.  These are the types of pumps we can see with Shitcoins.  Unfortunately, few of these ever materialize into a trend but there is always the chance that there is some follow-through.  Right now, we look for support to come in and for the horizontal area to confirm that there is something happening here.

FIRO/USDT:

FIRO is in a league of its own at the moment.  The coin posted 400+% gains over the last two days and there is a small chance it is only just getting started.  The problem with Shitcoins is that they don’t always respect TA the way majors do.  This token could drop 90% only to pump again the next day.  For now, we look to see if the 618 of the local move can be hit on this current move and if not, could there be a bounce after the pullback.

The Wrap Up

It can be very tempting to scour the Shitcoin market when you see some coins do 400-600% moves in a day but the reality is you need to be able to identify these things before they pop off.  We have spent years analyzing these markets and there are a few things to look for that can help identify potential situations like the two examples you saw above.  

We will be conducting live streams and we will soon have our courses available to help all traders learn to identify setups and trade with strategies.  For now, continue to watch the market for the outliers while we range for a while longer.

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