Altcoin Season 2024 : 4 Factors for delay In Altcoins Rally
Altcoins are now active competitors in the cryptocurrency markets, giving investors a variety of options beyond Bitcoin’s dominance. Despite being the leading cryptocurrency, Bitcoin, other alternative coins offer distinctive opportunities for growth and innovation. Nonetheless, altcoin surges frequently experience setbacks, causing investors to question the factors influencing these fluctuations. This article explores the main reasons behind the delayed altcoins rally.
1. The Geopolitical Tensions in the Middle East
Altcoins performance can be impacted by various external factors such as global market sentiment, geopolitical tensions and macroeconomic events.
One prevailing factor is the geopolitical tension in the Middle East, specifically, the rising conflict between Israel and Iran that have impacted the entire cryptocurrency market, altcoins included.
Usually, geopolitical conflicts cause uncertainties which result in increased market volatility. Investors respond to such events by moving their assets to safer investment havens. Hence, decreasing demand for riskier digital assets like altcoins.
Additionally geopolitical tensions can adversely affect investor sentiments. Concerns about escalating conflicts, cyber attacks and economic sanctions, can make investors become more cautious, resulting into a sell-off in the crypto market.
After the Middle East incidents, both Bitcoin and altcoins prices dropped significantly. For instance, on April 13, Bitcoin price experienced a drop of over 8.4%, following the attack of Iran on Israel. This led to the global crypto market crash, affecting altcoins too.
2. Bitcoin’s Dominance
Bitcoin dominates 53.21% of the cryptocurrency market, leading the market as the largest cryptocurrency by market capitalization. Investors might have become more cautious towards investing in altcoins, losing confidence in the wider crypto market, following the decrease in value of Bitcoin, which has dropped by 10% over the past month.
Since it is recognized as the most established cryptocurrency, the focus of investors tends to be fixed on BTC performance. This shifts capital and attention away from altcoins. When markets decline, there is a tendency of shying away from risks, resulting in a drop in the prices of altcoins compared to Bitcoin.
Additionally, when Bitcoin’s value drops, it restricts new investments in the market and ignites a negative market sentiment, thus, also affecting altcoins.
Historically, market circles have been dictated by the movement of BTC price, however, currently, the anticipated altcoin rally has been delayed because of the current BTC underperformance.
3. Market Cycles and Timing
The cryptocurrency market is famous for its recurring patterns. Analysis of historical altcoin trends indicate that market cycles may be lengthening, potentially causing delays in the emergence of rallies compared to earlier cycles.
Market cycles and timing play a crucial role in determining the performance and rally potential of altcoins. The ongoing market pullback has left many altcoin traders with heavy losses, with over 85% of altcoins considered to be undervalued based on MVRV calculations. The market is waiting for the right timing to capitalize on these opportunities.
The altcoin market typically goes through phases during a bull market cycle, and it seems to be in the chop phase, marked by uncertainty and re-accumulation post-Bitcoin halving event. The altcoin market is reflecting the price movements seen in 2020-2021, although the timing is different, which could be attributed to the growth and innovation of the cryptocurrency industry.
The delay in the altcoin rally is related to the price fluctuations of BTC. This implies that altcoin season may be delayed until the ‘digital gold’ stabilizes in prices or reaches new highs, as asserted by CrediBULL Crypto.
#Altcoins 2016-2017 vs. #Altcoins 2021-2024
There's not that much difference, is there?
It just takes longer than back then. pic.twitter.com/F8ilHdEbFE
— 𝕄𝕠𝕦𝕤𝕥𝕒𝕔ⓗ𝕖
(@el_crypto_prof) April 20, 2024
4. Market Manipulation and Whales
Cryptocurrency markets can be manipulated by influential holders, also called whales, who have a significant impact on price changes. Whales have the ability to influence the market by coordinating their purchases or sales, resulting in fabricated fluctuations and slowing down altcoin price surges. Furthermore, the existence of pump-and-dump schemes and insider trading intensifies market manipulation, impeding the natural development of altcoins.
Whales hold significant influence on altcoin prices through their selling pressure, impacting market sentiment and liquidity. Large sales by whales can delay anticipated rallies by causing sudden drops in prices and creating uncertainty. Conversely, strategic buying by whales can temporarily drive up prices, only to drop again when they sell off. Whales can also spread fear or greed through the media, affecting traders’ decisions and causing erratic market behaviour that delays potential rallies.
For example, an unknown wallet transferred nearly 25 million XRP tokens worth $14.75 million to the cryptocurrency exchange Bitstamp on April 8, 2024. This large transfer sparked speculation within the crypto community and was attributed to the subsequent price dip of XRP.
24,880,000 #XRP (14,752,878 USD) transferred from unknown wallet to #Bitstamphttps://t.co/wdX27lI223
— Whale Alert (@whale_alert) April 7, 2024
Conclusion
Although altcoins present promising opportunities for diversifying and investing, their rallies can be influenced by different factors leading to possible delays and fluctuations. In order for investors to successfully navigate the volatile cryptocurrency landscape, it is crucial for them to understand the fundamental factors behind altcoin rallies, such as market sentiment, regulatory uncertainty, technological advancements, and external market dynamics. By staying knowledgeable and conducting proper research, investors can improve their chances of taking advantage of potential opportunities offered by altcoins while reducing risks linked to delayed rallies.
The post Altcoin Season 2024 : 4 Factors for delay In Altcoins Rally appeared first on CoinGape.
Read More
TRON’s Futures Map Says “Not Overheated” — Could Another Rally Be Coming?
Altcoin Season 2024 : 4 Factors for delay In Altcoins Rally
Altcoins are now active competitors in the cryptocurrency markets, giving investors a variety of options beyond Bitcoin’s dominance. Despite being the leading cryptocurrency, Bitcoin, other alternative coins offer distinctive opportunities for growth and innovation. Nonetheless, altcoin surges frequently experience setbacks, causing investors to question the factors influencing these fluctuations. This article explores the main reasons behind the delayed altcoins rally.
1. The Geopolitical Tensions in the Middle East
Altcoins performance can be impacted by various external factors such as global market sentiment, geopolitical tensions and macroeconomic events.
One prevailing factor is the geopolitical tension in the Middle East, specifically, the rising conflict between Israel and Iran that have impacted the entire cryptocurrency market, altcoins included.
Usually, geopolitical conflicts cause uncertainties which result in increased market volatility. Investors respond to such events by moving their assets to safer investment havens. Hence, decreasing demand for riskier digital assets like altcoins.
Additionally geopolitical tensions can adversely affect investor sentiments. Concerns about escalating conflicts, cyber attacks and economic sanctions, can make investors become more cautious, resulting into a sell-off in the crypto market.
After the Middle East incidents, both Bitcoin and altcoins prices dropped significantly. For instance, on April 13, Bitcoin price experienced a drop of over 8.4%, following the attack of Iran on Israel. This led to the global crypto market crash, affecting altcoins too.
2. Bitcoin’s Dominance
Bitcoin dominates 53.21% of the cryptocurrency market, leading the market as the largest cryptocurrency by market capitalization. Investors might have become more cautious towards investing in altcoins, losing confidence in the wider crypto market, following the decrease in value of Bitcoin, which has dropped by 10% over the past month.
Since it is recognized as the most established cryptocurrency, the focus of investors tends to be fixed on BTC performance. This shifts capital and attention away from altcoins. When markets decline, there is a tendency of shying away from risks, resulting in a drop in the prices of altcoins compared to Bitcoin.
Additionally, when Bitcoin’s value drops, it restricts new investments in the market and ignites a negative market sentiment, thus, also affecting altcoins.
Historically, market circles have been dictated by the movement of BTC price, however, currently, the anticipated altcoin rally has been delayed because of the current BTC underperformance.
3. Market Cycles and Timing
The cryptocurrency market is famous for its recurring patterns. Analysis of historical altcoin trends indicate that market cycles may be lengthening, potentially causing delays in the emergence of rallies compared to earlier cycles.
Market cycles and timing play a crucial role in determining the performance and rally potential of altcoins. The ongoing market pullback has left many altcoin traders with heavy losses, with over 85% of altcoins considered to be undervalued based on MVRV calculations. The market is waiting for the right timing to capitalize on these opportunities.
The altcoin market typically goes through phases during a bull market cycle, and it seems to be in the chop phase, marked by uncertainty and re-accumulation post-Bitcoin halving event. The altcoin market is reflecting the price movements seen in 2020-2021, although the timing is different, which could be attributed to the growth and innovation of the cryptocurrency industry.
The delay in the altcoin rally is related to the price fluctuations of BTC. This implies that altcoin season may be delayed until the ‘digital gold’ stabilizes in prices or reaches new highs, as asserted by CrediBULL Crypto.
#Altcoins 2016-2017 vs. #Altcoins 2021-2024
There's not that much difference, is there?
It just takes longer than back then. pic.twitter.com/F8ilHdEbFE
— 𝕄𝕠𝕦𝕤𝕥𝕒𝕔ⓗ𝕖
4. Market Manipulation and Whales
Cryptocurrency markets can be manipulated by influential holders, also called whales, who have a significant impact on price changes. Whales have the ability to influence the market by coordinating their purchases or sales, resulting in fabricated fluctuations and slowing down altcoin price surges. Furthermore, the existence of pump-and-dump schemes and insider trading intensifies market manipulation, impeding the natural development of altcoins.
Whales hold significant influence on altcoin prices through their selling pressure, impacting market sentiment and liquidity. Large sales by whales can delay anticipated rallies by causing sudden drops in prices and creating uncertainty. Conversely, strategic buying by whales can temporarily drive up prices, only to drop again when they sell off. Whales can also spread fear or greed through the media, affecting traders’ decisions and causing erratic market behaviour that delays potential rallies.
For example, an unknown wallet transferred nearly 25 million XRP tokens worth $14.75 million to the cryptocurrency exchange Bitstamp on April 8, 2024. This large transfer sparked speculation within the crypto community and was attributed to the subsequent price dip of XRP.
— Whale Alert (@whale_alert) April 7, 2024
Conclusion
Although altcoins present promising opportunities for diversifying and investing, their rallies can be influenced by different factors leading to possible delays and fluctuations. In order for investors to successfully navigate the volatile cryptocurrency landscape, it is crucial for them to understand the fundamental factors behind altcoin rallies, such as market sentiment, regulatory uncertainty, technological advancements, and external market dynamics. By staying knowledgeable and conducting proper research, investors can improve their chances of taking advantage of potential opportunities offered by altcoins while reducing risks linked to delayed rallies.
The post Altcoin Season 2024 : 4 Factors for delay In Altcoins Rally appeared first on CoinGape.
Read More