Altcoins
Altcoin Market Cap Defends $850B Support, Next Resistance at $1.2 Trillion ⋆ ZyCrypto
The overall altcoin market cap (all cryptocurrencies except Bitcoin) has been volatile for most of the past few weeks. The secondary cryptocurrency market, often criticized for its volatility, lived up to its reputation by posting a 20% decline in the first five days of this month before recovering sharply in the last 72 hours. However, it managed to defend its $850 billion valuation before climbing back above $950 billion yesterday.
This secondary market roller coaster has been a key factor in the cryptocurrency market’s recent descent into fear, uncertainty, and doubt (FUD). The bullish enthusiasm generated by Bitcoin Exchange Traded Funds (ETFs) The market’s approval in January has largely dissipated. Bitcoin, the largest cryptocurrency by market cap, was expected to hold above $60,000 for the foreseeable future before a possible recovery in the third and fourth quarters of this year. Since the altcoin market typically follows the gains of the leading digital currency, it was also expected to remain sluggish.
Altcoins respond to selling pressure
However, the Surprise BTC sale by German government and the Mt. Gox settlement payments rocked the market at the end of the second quarter. Cautiously entering July, the digital currency space saw a spectacular sell-off, with BTC falling below $54,000 in a week. The secondary market fared even worse, dragged down by Bitcoin’s fall. Fortunately, both markets managed to stabilize and partially recover by the end of the second week.
Here is a chart of the altcoin market since the beginning of the month:
However, if we take a step back to better understand the situation, here is its graph since mid-2021:
According to According to crypto analyst Michael Van de Poppe, the altcoin market has reached a long-term low of around $500 billion and is unlikely to test that level anytime soon. However, the local low is around $850 billion, and bulls are likely to mount their defense soon if the resulting bearish forecasts are anything to go by.
Additional price corrections
At its current price of $59,900, a further drop in Bitcoin to $50,000 would also likely result in significant losses for altcoins. In this scenario, the secondary market would have to hold a valuation of $700 billion, which could translate into up to 30% of altcoin losses. However, if the market can withstand significant selling pressure, it could stabilize above $850 billion. resistance level Bitcoin price hits $1.23 trillion in early April. A surge beyond that point could pave the way for a new altcoin season and potentially new all-time highs.