Bitcoin’s meteoric rise above $8,000 USD in the past 24 hours did little to increase investors’ confidence in taking up the risker altcoins as the top altcoins traded flat against the dollar as BTC gained highs of 9% in the past 24 hours. Despite positive chart patterns forming in the alt market, calling for a possible alt-season, BTC remains the best near-term and long-term investment in the crypto market.
BTC grows by 9% in the past 24 hours as altcoins remain flat
BTC/USD confirmed its bottom back in December as the bullish reversal from $7,200 USD at the start of the year signals for a push towards $9,000 resistance area. Having tested the $6,660 key support in December left the market gasping for a bullish reversal or else face a drop towards the $5,000 USD support area. Needless to say, the top crypto’s market has performed excellently to test key resistance at $8,400 and within reaching distance of the psychological $8,500 USD.
Despite the magnanimous growth of BTC over the past 24 hours, top altcoins have remain rather unmoved against the dollar as Ethereum (ETH), XRP, Bitcoin Cash (BCH) and Binance Coin (BNB) all recorded moves of less than a percent in the past day. Actually, only Litecoin (LTC) was able to nearly match BTC’s gain, recording 5.6% growth as it faces its worst miner capitulation in years.
Why an Alt-season is not possible in the near-term
With top altcoins losing heavily against the king of crypto, BTC, markets are turning bearish on the possibility of a near-term alt-season – altcoins gaining significantly against BTC. Well there remains two major challenges as to why investors are not as interested in taking up long positions in alts (at least at the moment) despite BTC’s huge spike.
1. Most altcoins have just turned bullish
As Bitcoin faces a cycle of ups and downs through the past year, most altcoins have been on a downtrend. A case in example is the two top altcoins, ETH and XRP, which both ended 2019 at a loss despite reaching yearly highs in June at $380 USD and $0.51 USD respectively. The current recovery in the market represents the first bullish turn for most altcoins hence investors are not expecting a near term explosion in price despite BTC’s growth.
2. Investors lose confidence in altcoins
Confidence is key in the crypto market and currently investors are not all too confident on the current move of Bitcoin, despite the breach above $8,400. The high correlation in price between top altcoins and BTC, signals a possible interference by the latter in pushing the markets down or up.
With Bitcoin yet to hit the psychological barrier at $10,000 USD, investors may not feel confident that we are in a bull run yet hence choose to place their crypto investments on BTC rather than the risker altcoins options.
Can an alt-season materialize?
Prospects of an oncoming alt-season remain alive though, as the total market cap of altcoins breached the bearish wedge resistance with increasing volumes signaling a possible awakening of the market.
— harrydenley.eth ◊ (@sniko_) January 6, 2020
In the coming months leading to Bitcoin’s halving, a boost in BTC’s price may set the alt market to a frenzy with Ether and XRP on the verge of a bullish breakout.
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Been in the field since 2015 and he still love everything blockchain and crypto! FC Barcelona fan. Author and journalist. Follow him at @lujanodera.