Key Takeaways
Is the market favoring Bitcoin or altcoins proper now?
Bitcoin is main the rebound. Nevertheless, altcoin leverage is capped. If BTC hits resistance, alts might seize rotation capital.
Is that this a great time to purchase altcoins?
Solely 24% of Binance altcoins are above their 200-day SMA, exhibiting most alts are nonetheless in accumulation.
The market has flipped again to risk-on. This autumn kicked off with the TOTAL market cap bouncing 3.88% off the $3.85 trillion base, representing almost $160 billion in inflows, and marking the longest inexperienced candle since August.
Bitcoin [BTC] additionally noticed its market cap climb 3.92%, reaching $2.36 trillion. Technically, this highlights a notable development: BTC’s $90 billion influx accounted for 56% of the whole crypto market cap influx.
Merely put, greater than half of the $160 billion rotated into BTC, exhibiting that the rebound was BTC-led. Against this, TOTAL2 (market cap ex-BTC) jumped 3.81%, highlighting typical rotational flows.
Supply: TradingView (TOTAL/USDT)
Briefly, merchants are leaning into BTC, holding altcoins on the again foot.
Supporting this, the Altcoin Season Index dipped 2 factors to 65, at press time, signaling rotation away from alt-season. If this momentum holds, we might be heading right into a Bitcoin-led part, holding altcoin market share capped.
Nevertheless, what if BTC hits resistance? BTC.D was within the pink, and BTC is down 0.16% intraday, hinting at weak follow-through. In that case, might the Altcoin Season Index rebound, sparking a rotation again into alts?
Bitcoin massacre units stage for a strategic altcoin entry
The crypto market skilled a pointy sell-off over the previous 24 hours, triggering widespread liquidations.
In keeping with CoinGlass, 129,474 merchants had been liquidated, totaling $592.19 million—81% of which got here from quick positions. This implies almost $490 million was worn out briefly squeezes, fueling a fast worth surge.
Bitcoin bore the brunt, with $423 million briefly liquidations, accounting for 81% of the whole. Regardless of this, Bitcoin’s Open Curiosity (OI) stays close to all-time highs, indicating that the derivatives market remains to be extremely energetic and closely leveraged.
Supply: Coinglass
In the meantime, Ethereum [ETH] leverage sits about $10 billion shy of its ATH.
Why does this matter? With Bitcoin main the rebound, merchants are aggressively piling into BTC. That is holding altcoin leverage capped and limiting extreme danger from spilling into the broader alt market.
On this context, if Bitcoin runs into resistance, alts might seize the highlight, particularly with the Altcoin Season Index sliding again towards the 60 assist, establishing a possible rotation into altcoins.
Alts in accumulation zone – Shopping for alternative forward?
CryptoQuant points to a powerful altcoin shopping for alternative.
With positioning beneath management, euphoria cooling, and the Season Index holding key assist, the setup screams “dip-buy,” particularly with Bitcoin derivatives nonetheless overheated, capping long-term upside.
On-chain information backs this up. Solely 24% of Binance altcoins are above their 200-day SMA. In different phrases, 76% of altcoins are nonetheless buying and selling under their long-term development, indicating a possible accumulation zone.
Supply: CrytpoQuant
Traditionally, altcoin tops line up when 100% of alts are above their 200-day SMA, marked by the blue/purple lengthy peaks. Briefly, the market remains to be removed from altcoin euphoria, leaving loads of room for accumulation.
On this context, the rotation thesis solely will get stronger.
Even with BTC kicking off October with huge inflows, a full-blown “Bitcoin Season” remains to be a stretch. That leaves altcoins in a major spot to take in capital, making this a clear dip-buy setup.
