The State of the Alts – 09-01-22

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 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 September 2022! Very few people are excited for September as it’s a historically down month in terms of all assets in all markets. The price action leading us to September 1st has been anything but Bullish, and therefore the sentiment these days is pretty Bearish and underwhelming. Bitcoin Dominance had its Daily 50 cross back under its Daily 200, marking the initial crossover as dead in the water.

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. 

Paving the way to failure, we have our ALTPERP. The rolling 7-Day leaves everything red from last week. Ethereum, LINK, and BNB are all down 8% from last week, and DOT is showing a 9% drop. This comes in the same week the Daily 20 EMA crossed below the Daily 50 EMA once again. The rally for upside began when the 20 crossed above the 50 back on August 2nd, but by the 29th of August, that rally was officially over after only putting in 11 actual days of upside to reach its peak.

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 L1s like Algorand to ad-seeking marketing like BAT.

Not surprisingly, the MIDS are following suit with the ALTPERP chart. The same crossover we spoke about above happened to the MIDS, but it happened two days earlier than ALTPERP, paving the way for more downside in the near future. The MIDS did have an overhead level of resistance that it used when the peak was rejected, unlike the ALTS, which did not have any immediate overhead resistance. LEO is one of the few MIDS that actually show a positive gain over the previous seven days.

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!

ShitPERP is more in line with ALTS in regards to the day the crossover was official but more in line with MIDS in regards to the peak of this last rally failing at overhead resistance. SHIT seems to be sharing a bit from each index. Where SHIT differs is the type of overhead resistance it failed on. That resistance was horizontal resistance stemming back from previous price action. 

Weekly Movers

LTC, ATOM and XMR are the only three showing any type of life currently and that is mostly lower timeframe analysis. ATOM looks the best by far being that the PAS is showing a strong bullish trend on the H6 resolution. 

The Wrap Up

This market can chew you up and spit you out if you let it. The rally from early August is yet another false rally as we can see the breakdown has begun. This does not mean that it can’t find support above as previous low and attempt to salvage the trend. The good news is that the larger trend from back in Mid June is still intact. The immediate trend up is broken, but the larger trend is still in place. That being said, the macro trend is still incredibly down, and it will take a lot to reverse the course of that action. 

If we see further downside, the levels to look for will be the low levels from June. If they are tested and there is enough Fear and momentum, those levels will likely break and therefore usher in another round of new lows. The good news is that we can actually find support before the new low and therefore prevent a new low and instead give us a potential reversal. Only time will tell, but the momentum is certainly with the Bears at the moment.

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