Market Outlook 28/03/2020

 Introduction

This article is going to focus only on TA and on-chain data to explain when and how much money to move to Altcoins. Should we be moving to Altcoins? Yes Am I going to move to Altcoins? Yes Is this an Altcoin season? Yes, Are you an Altcoin fan? Yes. “Altcoin season,” or “alt season,” is a meme for the idea that bitcoin returns move cyclically against other crypto assets, or “altcoins,” as in, alternatives to bitcoin. The notion is that investors take their bitcoin profits and play the altcoin casino with house money, and vice versa [2]. 

Last week, Grayscale Investments announced a slew of new trusts, each focused on smaller-cap “altcoin.” (CoinDesk and Grayscale are both owned by Digital Currency Group.) A dozen other assets are also ahead of bitcoin, led by Web 3.0 assets Cardano (ADA, -0.31%) and algorand (ALGO, +4.32%) and DeFi asset 0x (ZRX, +3.52%) [2]. 

Before you continue reading this article, please also see the following video:

Why should we move to Altcoins? But of course for diversification? Nooooooooo. Diversification is the most stupid thing someone can say when referring to cryptocurrency portfolio diversification, for more information see my post Data-Driven Approach To Cryptocurrency Speculation The Ultimate Methodology. Portfolio diversification makes sense only when used with stocks and commodities. Why? Because with crypto we have access to on chain data, and can run multiple correlations to see what is going on. The only reason we should be should be diversifying is Black Swan events e.g. 3rd world war happens, the Altcoin company you invest gets hacked etc.

Below we can see as sample correlation for the period from 2021-02-07 to 2017-17-08:

Note: Above we can see how coins correlate with each other. Also good diversification  is recommended to take place in two different phases when the BTC dominance is low we move to Altcoins that correlate low with BTC and when BTC dominance is high we move to Altcoins that have high correlation with BTC.        

The Altcoin Index

Blockchaincenter is a web site that records who the rest of the coins perform compared to BTC and below we can see the stats.

Below we can see the graph with the performance:

Note: We can see that LUNA, CAKE and ENJ are doing very well. 

Below we can see a different, visualization, that compares BTC performance with the rest of the coins:

Note: Notice that ETH is not doing that well. Maybe is time to get rid off some.

The graph below demonstrates a nice way to record the dominance of the BTC Mkt cap:

Note: See how the seasons alternative based on BTC market dominance.  

Below we can see the Altcoin index from the same source:

Note: This is the Bitcoin, Altcoin index Season.

The Altcoin TA Analysis

Below we can see the total crypto market cap:

Note: The total crypto market cap is not at 1.9T and the monthly chart looks very bullish.

Below we can see the total altcoin market cap:

Note: Above we the Altcon market cap from EXCAVO.

The BTC TA Analysis

Below we can see the 4hr chart of BTC, with MAs showing support:

Below we can see the 4hr chart of BTC with oscillators showing a reversal:

Conclusion

Right now is a good time to enter the Altcoin market, as we are in the start of the 2nd Bull cycle.

References:

• www.blockchaincenter.net [1]
• www.coindesk.com [2]