Altcoin
Will Bitcoin Face the Onslaught of Altcoins? Here’s what awaits us in June
- The altcoin positioning chart showed that altcoins have performed well against Bitcoin recently.
- Their market capitalization has grown steadily along with BTC’s price gains.
THE Bitcoin [BTC] The crisis of early May lasted only for a short time. THE Inflows into ETFs they were negative for about a week at the beginning of the month, but have since seen a rapid recovery.
The last two weeks have seen consistent inflows which have highlighted the presence of demand behind Bitcoin.
The performance of altcoins over the past month has also been positive. Memecoins have been some of the best individual performers, but the rest of the altcoin market has also expanded its market capitalization.
Will the pattern of the last nine months repeat itself once again?
Source: JessicaMiranda on X
Cryptographic analyst Jessica Miranda observed in a posted on X (formerly Twitter) that altcoins had more importance than Bitcoin. While Bitcoin still holds just over 54% of market share, alts have performed better than the king recently.
The analyst noted that this usually does not last long and is usually followed by a decline in BTC prices. This has been true for much of the last nine months, when the rally began in earnest in September 2023.
Source: JessicaMiranda on X
However, over longer time frames, even intense bull runs can have periods where altcoins outperform Bitcoin. The 2016-17 season was full of similar moments. Fewer such events occurred in 2020-21, but a BTC rally saw a tailwind for altcoins.
The downtrend of 2022-23 was where this pattern became clearest. If it repeats once again, Bitcoin could see a decline in the next week or two.
Taking into account Bitcoin’s recent breakout above the $67,000 resistance, such a drop was unlikely. However, it is something traders may need to be prepared for.
What does the Bitcoin dominance graph reveal?
Source: BTC.D on TradingView
BTC dominance was nearing a short-term low at 54%, meaning it would likely rebound soon.
Such a bounce would halt any rally initiated by the altcoin market, but would also subvert expectations of a BTC price decline from the altcoin positioning chart.
Source: TOTAL2 on TradingView
The suggestion that the altcoin market could undergo a pullback gained more credibility when the market capitalization of altcoins, or the market capitalization of the entire crypto ecosystem minus that of Bitcoin, was analyzed.
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The market cap chart has approached a key resistance zone at $1.24 trillion. From a technical analysis perspective, a rejection from that region was expected, although this resistance would eventually be broken given the strong uptrend of the last eight months.
Therefore, based on technical analysis, a rise in Bitcoin and a (temporary) collapse in altcoins is expected in the first half of June.
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