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Highlights
- The ALTs have come under selling pressure following a sell-the-new momentum after the Fed meeting.
- Whales continue every dip as a buying opportunity while eagerly waiting for the Fed rate cuts in September.
- The ALT/BTC pair can bleed further during the August consolidation.
After the US Fed meeting on Wednesday, Bitcoin and the broader crypto market came under heavy selling pressure in what seems to be a sell-the-news event. Fed Chair Jerome Powell kept interest rates unchanged at 5.25% while speaking about the possibility of a rate cut ahead in September. Apart from Bitcoin, the altcoin market faced strong liquidations on Wednesday with top players like Solana and XRP correcting 7-8%.
Altcoin Whales on Buying Spree
Although ALTs have been underperforming recently, whales have been buying the dips accumulating the most ahead of the Fed rate cut coming in September. This Fed pivot will usher strong liquidity in the market leading to a major rally in alts.
CryptoQuant CEO Ki Young Ju said that whales have been positioning themselves for the upcoming ALT rally. He noted that the limit buy order volume for alts, excluding Bitcoin and Ethereum, is on the rise. This trend suggests that strong buy walls are being established, signaling increased interest and potential for a surge in ALT prices.
Founder of Tolou Capital, Spence Hakimian wrote: “Rate cuts and higher fiscal deficits are so bullish crypto. And since altcoins have higher beta than Bitcoin, they should do better in a risk on environment. Makes sense to see the whales positioning as much”.
On the other hand, the Ethereum whales have been on an accumulation spree despite the Ether ETF outflows. In the last 48 hours, the whales have accumulated nearly $450 million of ETH from the open market.
Ethereum whales have accumulated over 126,000 $ETH in the last 48 hours, worth approximately $440 million! pic.twitter.com/hwHU0fAcdc
— Ali (@ali_charts) July 31, 2024
Also Read: Will ETH ETF Inflow Revival Spark Ethereum Price Bull Run in August?
August Could be the Month of Accumulation
With the Federal Reserve eyeing a 25 bps rate cut in September, the crypto markets are likely to show sideways consolidation for the next four weeks. This could also be a period of strong accumulation for long-term players willing to participate in the next crypto market rally.
Popular crypto analyst Benjamin Cwen said that the alts will continue to bleed against Bitcoin until a liquidity pump hits the market. This situation is quite similar to what happened in 2019.
The choppy price action of #BTC since March with a bearish bias is causing ALT / BTC pairs to bleed.
This is playing out very similar to 2019. Back then BTC also trended down for a while after Gold broke out (which happened in March this year as well.
Thread 👇 pic.twitter.com/CB0JTZyXu7
— Benjamin Cowen (@intocryptoverse) August 1, 2024
Also Read: BlackRock vs VanEck: Solana ETF Takes Center Stage In This Epic Battle
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