Altcoins Bleed Out against BTC as Selling Pressure Continues Mounting
- Bitcoin has been on a wild ride throughout the past few weeks, and its parabolic growth trend is showing no signs of coming to an end anytime soon
- Where the market trends in the mid-term should depend largely on Bitcoin and whether it can sustain its upwards trajectory
- So far, altcoins have not been able to match or exceed the growth seen by BTC, with Ethereum’s severe underperformance potentially being one of the main factors behind this
- One trader is noting that it is dangerous to be heavily exposed to altcoins while Bitcoin is “trailblazing” and that it may be better to sit back and wait before starting new altcoin positions
Bitcoin has been rallying independent from the rest of the crypto market, which has caused major altcoins like Ethereum to post massive losses against their Bitcoin trading pairs.
This trend has been ongoing for over a month now, with BTC’s uptrend happening in isolation of those seen by other, smaller, altcoins.
One trader is now noting that this trend could persist in the near-term while Bitcoin’s price continues rocketing. He contends that it is best to wait for BTC to stabilize before jumping into altcoins.
Bitcoin Rallies Towards $26,000 as Altcoins Stall
At the time of writing, Bitcoin is trading up nearly 5% at its current price of $25,860. This is around the price at which it has been trading throughout the morning.
This marks a massive rise from daily lows of $24,000 set yesterday morning and shows that BTC is still in a firm price discovery phase.
However, its recent strength has not been enough to create tailwinds for altcoins, as most are still trading down significantly against their BTC pairs.
Analyst Warns against Knife Catching Falling Altcoins
One trader explained in a recent post that investors are taking on major risks by jumping into altcoins right now.
He notes that altcoins typically cannot gain any serious momentum until Bitcoin cools off and enters a consolidation phase.
“Hope you all had a good Christmas. As expected, altcoins went through some wild chop following those wicks cutting up traders left and right. If there is one thing I’ve learned over the years is that you don’t want to be too aggressive on alts when BTC is trailblazing.”
Image Courtesy of DonAlt. Charts from TradingView.
It’s unclear as to just how far Bitcoin will rally before it sees some sideways trading and allows altcoins to move higher, but for the time being, its price action is putting altcoins in a precarious position.
Featured image from Unsplash. Charts from TradingView.
@Mashinsky @CelsiusNetwork BTc to Alt ratios are higher, XRP is moving to BTC, institutions are buying in bulk and holding. I’d say that 8 billion is not as big of a hit. Volume has a lot to do with it. Buying pressure is high, etc.
@NiGMa46 And in terms of nodes if a business wallet node like say @BullBitcoin_ processes lots of transactions, and their node rejects payments that dont follow bitcoin rules that exerts more back-pressure into the network rejecting invalid coins, or many power users similarly.
Global stocks under pressure amid fresh US-China tensions. Hang Seng and CSI 300 leading the losses as US to blacklist more Chinese firms. Bonds gain w/US 10y yields at 0.915%. The Dollar catching a bid w/Euro at $1.2250. Gold at $1881/oz, Bitcoin pares some gains, now $22.9k.
Chinese State Media Claims Bitcoin Bull Market Could Put Pressure on Gold
Bitcoin price risks losing ‘critical technical level’ as stocks under pressure
Bitcoin faces pullback risk as U.S. stocks begin to drop following a six-week rally.