I just saw an interesting chart displaying alt-to-btc cycle that left blanks to be filled in by viewers which gave me the idea to share my thoughts on the interplay of alts and BTC. Was originally going to post in comments there, but there is just so much to discuss around this topic so posting a deeper analysis here.
At BTC cycle bottom (before this chart and where we were a month and a half ago) alts are more oversold than BTC and therefore pump hard getting big gains anywhere from 4-20X, bringing them back to nearly or even beyond ATH. Check out my Bounce Play You Should Never Miss Again idea where I elaborate on this and why ignoring BTC on its 1 wave and being in alts is best.
Profits are then taken in BTC and the alts start long corrections (pump for 1-2months, correct for 6...although the B wave looks like another pump and against $ it is). This long correction spans the 2, 3, 4 waves of BTC.
By the 5th wave alts start waking up and near the end of the fifth they really start going nuts. As BTC goes parabolic on 3of5 ppl start taking profits and putting them in alts for a big 1 wave. BTC 4of5 provides the 2 wave. BTC 5of5 is where alts put in their 3 waves and see massive gains (mid December)...this only makes sense bc everyone knows BTC cannot go much further so the $ have to go somewhere and alts and fiat are the only options. BTC then puts in its A down of ABC and alts put in their 4s. The BTC B wave is where alt 5ths are put in and we get some extended monstrous fifths here in some (just like Jan was a much bigger month for some alts than Dec was).
CRASH - this we just went through and it occurs during BTC C wave and beyond if more complex correction. BTC makes final fall, not as steep as A but longer in duration and alts plummet as $ flies out of the market.
...bottom again where we smash the alts first and repeat. I believe alts have more to go even though many are up several 100% already. By the end of June I think 10-20x off bottoms will be a reality for many alts and then we will have a big correction till late in the year again. There is also the chance that BTC puts in a big B and we head below 6 after finishing these 5 waves in the 12-13k range as was my early March Idea. Either way, alts will fall quite a bit and come back up late in the year imo.
Hope you enjoyed this enough to give a like and I would love to read your views on how the alt-btc cycle works in comments.
I linked the post that got this idea going. Not any analysis there but a nice chart that has more than 2 arrows on it showing where we had pumps last year and the parts of BTC cycle they occurred at.
At BTC cycle bottom (before this chart and where we were a month and a half ago) alts are more oversold than BTC and therefore pump hard getting big gains anywhere from 4-20X, bringing them back to nearly or even beyond ATH. Check out my Bounce Play You Should Never Miss Again idea where I elaborate on this and why ignoring BTC on its 1 wave and being in alts is best.
Profits are then taken in BTC and the alts start long corrections (pump for 1-2months, correct for 6...although the B wave looks like another pump and against $ it is). This long correction spans the 2, 3, 4 waves of BTC.
By the 5th wave alts start waking up and near the end of the fifth they really start going nuts. As BTC goes parabolic on 3of5 ppl start taking profits and putting them in alts for a big 1 wave. BTC 4of5 provides the 2 wave. BTC 5of5 is where alts put in their 3 waves and see massive gains (mid December)...this only makes sense bc everyone knows BTC cannot go much further so the $ have to go somewhere and alts and fiat are the only options. BTC then puts in its A down of ABC and alts put in their 4s. The BTC B wave is where alt 5ths are put in and we get some extended monstrous fifths here in some (just like Jan was a much bigger month for some alts than Dec was).
CRASH - this we just went through and it occurs during BTC C wave and beyond if more complex correction. BTC makes final fall, not as steep as A but longer in duration and alts plummet as $ flies out of the market.
...bottom again where we smash the alts first and repeat. I believe alts have more to go even though many are up several 100% already. By the end of June I think 10-20x off bottoms will be a reality for many alts and then we will have a big correction till late in the year again. There is also the chance that BTC puts in a big B and we head below 6 after finishing these 5 waves in the 12-13k range as was my early March Idea. Either way, alts will fall quite a bit and come back up late in the year imo.
Hope you enjoyed this enough to give a like and I would love to read your views on how the alt-btc cycle works in comments.
I linked the post that got this idea going. Not any analysis there but a nice chart that has more than 2 arrows on it showing where we had pumps last year and the parts of BTC cycle they occurred at.
Note
One thing to add to the Crash phase is that this phase provides amazing counter trend scalps on alts (outlined in my Bounce Play You Should Never Miss Again idea). It is important to watch BTC and where it is in its count so that deadcat bounces can become massive profit producers rather than things to wait out till the real thing. Also, if you check out my What Is Your Plan post, you can see one strategy for these where profits are taken part fiat, part free coins, in order to increase both risk capital as well as portfolio positions. The proportion of free coins should increase as the correction approaches bottom, for obvious reasons. GL trading and given market conditions...happy hodlin tooNote
here are my related ideas I referred to in this post:
Note
Alts seem to be giving an indication of what is in store for BTC next. Many are seeing a big dump and revisit of lows but with alts already at strong supports and having retraced to 50% and 61.8% in many cases, I think a temporary bottom is in here at low 8k level. Due to these supports being hit, I expect bounces and am long in my alts atm with reserve cash left to add if btc makes another small leg down to 8200ish. A B-wave from there (or where we are now) up to 8900-9100 would allow alts to put in a solid bounce OR even a first subwave of their next leg up. The subsequent C leg of BTC down to 7.8k regious +/-300 (read subwaves for precision) will allow the alts to put in their 2s OR reach out to the next fib level below the one they are at.I DON"T SEE THIS GOING BELOW 7.5K and even that with a wick as 7.8k is very strong support for BTC C wave. The main reason for this is that a deeper move would likely take out the lows set in March and April and market sentiment doesn't seem to be anywhere near that bearish. Also, I expect a pump coming out of consensus in about 5days which doesn't give us enough time for a sustained down move. The 5days does gives us enough time to put in a 24-36hr B wave now followed by a few days of dump C into consensus. There we buy up oversold alts and play our always trusty BOUNCE PLAY YOU SHOULD NEVER MISS AGAIN play. GL trading
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.