Markets
Altcoins Like XRP Will Soon Show Signs of Life. Here’s Why
Currently, the spotlight is on the Bitcoin Price chart and the current state of the crypto and altcoin markets. Analyst Blockchain Backer said that while ETFs are crucial, the crypto market has historically performed well during risk-off periods. While there are various narratives surrounding cryptocurrencies, such as sound money and block reward halvings, the reality is that the market usually follows broader risk-off environments.
Altcoins and Index Correlations
Looking at the altcoin market, He said it often peaks and rallies alongside traditional indexes like the Russell 2000. That trend was evident yesterday when the Russell rose 3.9% while the NASDAQ fell 2.24%. Smaller and mid-cap stocks outperformed major tech companies like Microsoft, Nvidia, Apple, Google, Amazon, Meta and Tesla, indicating a growing market share.
Historical market patterns and future outlook
This development is significant according to the analyst. Historically, every major rally in the crypto market has coincided with similar behavior in the Russell 2000, be it in 2020-2021, 2016-2017, or 2012-2013. This broad market participation has been a precursor to significant rallies in the crypto market.
The recent action in the Russell 2000 is a positive sign, although it is not yet a complete breakout. The market has been range-bound for months, and this initial move is encouraging. The focus now is on whether this trend can continue and lead to a broader market expansion.
He added that we saw some early signs of altcoins before Bitcoin began its expansion. For example, XRP and Litecoin started to take off in 2017 before Bitcoin. Using the 2017 benchmark and looking at Dogecoin’s history from 2013 to 2017, we see that we are at a critical juncture where expansion typically begins.
There is now a wider market share, which is essential for altcoins like XRP to show signs of life. This broader participation is a positive sign, especially as the Russell is recovering to its previous highs while cryptocurrency prices remain low.
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