Lots of people are talking about the bearish autumn that cryptostocks seem to be having – but some others are discussing how rather obscure and secondary indicators might show that Bitcoin, as well as other crypto favorites, are poised to break out.
A story today at Bitcoinist cites a report from Santiment, where analysts are looking at a couple of things, including the prospect of Bitcoin ETF approval by the SEC. We’ve talked quite a bit about that and how it might change markets, but Santiment researchers found another sort of unrelated indicator that traders really should know about.
This is the way they characterize it: a selection of altcoins “marching to their own beat.”
The article includes visual charts that help you get the idea much better – look at Basic Attention Token (BAT) and its movement throughout September and October – then look at Maker (MKR), a stablecoin based on Ethereum (ETH) and look at the same chart history.
These are just two of several that Santiment analysts point out as decoupling from Ethereum in a very interesting way. You can see throughout August and the beginning of September and into the beginning of October, how closely BAT and MKR prices track with ETH prices – but then something else happens, and both of them end up climbing 200% above Ethereum while the underlying cryptocurrency, a household name that was traditionally among the most popular coin options, languishes in the doldrums.
Santiment people are arguing that “strong on-chain activity and bullish price action” can lead to some of these alternative coins boosting the market and creating that burst that the crypto sector needs to climb out of its current sleepy pattern.
“A combination of these three factors led Santiment analysis to conclude that cryptocurrency projects built on Ethereum blockchain are slowly leading the market into a bull run,” writes Eustace Cryptus. “They do concede that market could drop another notch before reversing course, but Santiment feels confident enough about the current market set up to conclude that ‘The bull market has started. It’s not about ‘when’ anymore – it’s about ‘who.’”
Traders who are now tracking Bitcoin, at its price around $6500 today, can take a longer view and realize that no matter whether Bitcoin jumps or jogs within the next week or so, they can be also looking at altcoins as valuable indicators as to whether crypto is going to be bullish in 2019. Essentially, in a nutshell, it’s important to look at all of the coin options, pick your favorite ones, and track their progress. It’s not all tied to Bitcoin and obviously, as we can see, it’s not all tied to Ethereum, either.
As evidence of that, BAT snapped this morning above 30 cents – and as for MKR, all you have to say is that it’s doubled since September, at least at the three month high. Sure, there’s a boat load of volatility, but day traders should have been thinking about going over to play with some of these altcoins while BTC and ETH have breen crawling sideways. And, in the long term, you can bet on dark horses rather than being confined to build your crypto empire out of either Bitcoin or Ethereum.