Bitcoin Shocktober Continues To Outperform Altcoins En Masse
October 12 2021 - 11:28AM
NEWSBTC
In the crypto top 10 by market cap, Bitcoin reigns supreme with no
other cryptocurrency close to matching its performance in the daily
(-1%) and weekly (16.6%) charts. While BTC’s price trades at
$57,415, near its previous highs before May’s crash, the altcoin
market lags. The second cryptocurrency by market cap, Ethereum
(ETH), records a 3.9% loss in the daily and only a 2% profit in the
weekly chart. In the meantime, ADA (-4.7%), XRP (-5.7%), SOL
(-5.4%), DOT (-6%) are in the red alongside other major coins.
Related Reading | Bitcoin Over $100,000 Is Still Possible By
Year-End, Says Research Analyst In higher timeframes, Bitcoin
widened the performance margin with the rest of the crypto market,
according to a recent report by Arcane Research. Up 41% over that
period, the research firm claims the “Bitcoin Season has started”.
Know by traders and veteran operators as a period in the cycle when
Bitcoin outperforms every other asset, it is believed to precede a
bullish bull-run in altcoins. As seen below, BTC has more returns
than Arcane’s Large Cap Index only up 21% in the 30-day chart. This
could lead to more appreciation for Bitcoin as operators fuel a
“loop”, as the research firm called it”, where either BTC or some
altcoins outperform: (…) the cryptocurrency market periodically
switches between overperformance of altcoins (altcoin season) and
overperformance of bitcoin (bitcoin season). Historically, when
retail traders have observed that bitcoin starts to beat their
altcoin holdings, they have not been late in dumping their altcoins
for bitcoin instead (…). Bitcoin Takes Back The Crown As It
Prepares For More Gains Additional data provided by research and
consulting firm Delphi Digital indicates that only 4
cryptocurrencies out of the first 100 listed by CoinGecko have been
able to outperform Bitcoin in the daily chart. In the last 2 weeks,
only 12 have achieved something similar. Related Reading | Bitcoin
Retakes May Highs With Spike In On-Chain Activity, Next Target
$60K? Moreover, the research firm records a pattern in the Bitcoin
and Ethereum Open Interest (OI) for their futures. The first and
second cryptocurrencies by market cap have been “mirroring each
other” since Q3, 2021, until very recently. As seen below, October
brought a change in that dynamic with the ETH (OI) diverging from
BTC’s. However, Delphi Digital noted that the latter is still away
from May’s highs and, therefore, not in a FOMO state. The research
firm added: Since May 2021, crypto-margined futures have been on a
multi-month downtrend as cash-margined futures gain a significant
share of futures OI. One of the main implications of this is
reduced directional convexity. As NewsBTC reported yesterday, there
has been an uptick in BTC’s on-chain activity that suggests an
increase in institutional participation. The potential approval of
a Bitcoin ETF by the U.S. Securities and Exchange Commission could
operate as a bullish catalyzer to finally provide the bulls with
enough momentum to reach new highs. Related Reading | On-Chain Data
Shows Bitcoin Miners Hold Off On Selling Despite BTC Rallying Above
$57k On the contrary, it could also become a “buy the rumor, sell
the news” event potentially marking the top of the current cycle.
This could be beneficial for the altcoin market, in the mid-term.
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