The State of the Alts – 12-16-22

The Global View

Top Left: Total Market Cap – Daily
Top Right: Total Excluding BTC – Daily
Bottom Left: Total Excluding BTC and ETH – Daily
Bottom Right: Total Market Cap – Others – Daily

The charts above represent the Market Cap of Crypto in four different ways. At first, we can see the total Market Cap of all of Crypto, and we can easily decipher if there is a trend up or down. From there, we move to the total Market Cap of all Altcoins (any coin that is not Bitcoin). The bottom two charts represent the entire Market Cap without Bitcoin and Ethereum, somewhat representing what the entire Altcoin market Cap looks like with the biggest player, Ethereum. The last chart is called Others, which would be our closest representative of Shitcoins.

Between the CPI, the FOMC, Binance FUD, SBF getting arrested, FTX on Capitol Hill, and a host of other events this week, it was best to take a look at the State of the Alts on Friday instead of the usual Thursday. And here we are, at the end of the work week, and what a sad state of affairs we have in front of us. The overall sense after a quick scan is more downside, and that is because resistance is doing its job, and the Bulls are too weak to do much of anything about it.

Total Market Cap - (T - 125)

Description: Total Market Cap is the figure you get when you add up the market cap of all individual coins throughout crypto. This number comes with a disclaimer, as not every single crypto is included in this list. With over 20,000 individual token protocols, not everyone is legit. There are dead coins, scam coins, and coins that are irrelevant and artificially propped up to maintain some type of market cap. This chart, in particular, is calculated by TradingView, and the Total Market Cap comprises the Top 125 coins on the market.

Starting from the very top, the Global Market Cap made another attempt at the Daily 50 EMA after struggling on the Daily 20 EMA for 14-days. Unfortunately, this resulted in an instant denial from the 50, which lead the Market Cap directly back to its safe haven of the 20 EMA. However, this currently is showing a break in the trusted 20 EMA as it has been used and abused over the last three weeks. We are currently well under both the 50 and 20 EMAs, and we are at the lowest we have been in the last two weeks. We are still well above support, and we are still placed above the overall macro downward-sloping trendline. 

Total Excluding BTC

Description: This chart is the Total Market Cap but without Bitcoin. The reason for this is to get a gauge on where all the other money is in Crypto if it’s not in Bitcoin. The difference between the Total Market Cap and the one excluding Bitcoin can help you understand where Bitcoins’ Dominance comes from. If the chart above was half of the Total Market Cap, we could say that Bitcoins’ Dominance in the entire Cryptosphere is 50%.

Without Bitcoin, the market cap is in a bit more trouble. We have created an area that was squeezing the price data. On the bottom side, we had a huge support zone, and on the top side, we had triple resistance. First, the Daily 20 EMA; second, the Daily 50 EMA and third, the downward-sloping trendline. We saw the same type of attempt and instant batting down at the 50 EMA, and we see almost the same type of drop lower than the 20 EMA. However, TOTAL2 is very much inside of its support zone and is nearing the middle of that zone. This is very deep compared to TOTAL, which has yet to reach its level of support so far.

Total Excluding BTC & ETH

Description: Just as the chart above excluded Bitcoin from the Total Market Cap, this chart excludes Bitcoin and Ethereum. Ethereum has made its stand for the Number One Altcoin and currently enjoys a 4X in Market Cap next to its closest competitor on the list. This chart removes the two biggest players from Crypto and gives us a better idea of what the actual market is doing, regardless of what the two major players are up to.

Just as you would expect, TOTAL3 is in worse shape than TOTAL2, which was in worse shape than TOTAL. The logic to this is pretty simple. Remove the strongest and then the two strongest coins from the Top 125, and the market gets weaker and weaker without the ability to run away in any meaningful way. The progression of depth is something to consider. TOTAL has yet to reach its support, TOTAL2 is nearing the middle of its support, and TOTAL3 has just broken the bottom of its support. Each version of the chart is weaker as you remove BTC and Ethereum, respectively to TOTAL2 and TOTAL3. What is worse about TOTAL3 is that it never attempted a shot at the Daily 50 EMA, instead, it failed the 20 EMA for weeks while taking further resistance from its downward-sloping trendline. Coupled with the recent price action and the market bleeding, that was enough to slide through the bottom of the sup[port zone. We were here before, three to four weeks ago, but all current forces are to apply more downside. It will take a lot for TOTAL3 to manage support in this area.

Market Cap - Others

Description: In keeping with TradingViews tradition of removing coins from their Total Market Cap, OTHERS represents coins 11-125 by Market Cap. They essentially remove the Top 10 coins from their list of 125, and we are essentially left with the old Index we used for Midcaps. This does not precisely show us what mainstream Shitcoins are doing but rather the middle-of-the-road Mids that are fighting with each other to move up the list and breach the sacred T – 10.

What is interesting about this chart is OTHERS never attempted a run at the 50 EMA despite it not having extra resistance from its downward-sloping trend. OTHERS have also not even reached their support zone yet, like TOTAL. One would think that OTHERS has plenty of buffers to continue the downside, but we must remember that compared to TOTAL, TOTAL2, and TOTAL3, OTHERS is way lower already. Simply look at the downward-sloping trendline as an example of where each chart is relative to that dynamic level. 

Top 30 by Market Cap

Here we can see the price action and trends of the Top 30 in Crypto by Market Cap. On the right-hand side of the picture, you can also see the Peak Gains from the last seven days.

The Wrap Up

The current market can flip on a dime but for what reason? Generally speaking, everyone wants the market to go up, but it’s never good to have major price action swings or reversals without a catalyst. That will always leave the unanswered question behind as to why the price moved the way it did. 

In the current state, there is an argument to be made for a reversal in the way that fiat currency is being exposed in its weakness as inflation grows, but that does not seem to garner any interest from crypto or at least enough to outweigh the criminals like SBF who have helped to suppress the price even further.

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