Cryptocurrencies continue to rally. He Bitcoin It rises more than 4.5% in the last 24 hours and is close to US$37,000, renewing annual highs. While Ethereum It is located at US$1,900.
The latest rally in altcoins confirms the increased risk appetite of investors. According to some analysts, these abrupt increases were due to a significant compression of short positions in the derivatives markets, which also drives Solana (SUN) up to 10%, Cardano (ADA) by 5.8% and Dogecoin up to 2%.
Be that as it may, the truth is that the market is in a phase of absolutely unbridled optimism that is reflected in two indicators.
The first, the Fear & Greed Index, which, according to CoinMarketCap, stands at 73 points and continues at its highest level since November 2021, at which time the bitcoin marked its all-time high. The second, the total market capitalization, which reached $1.32 trillion, the highest figure since Terra’s implosion in the spring of 2022.
Bitcoin vs altcoins: change in investment strategy?
This rotation towards altcoins, experts explain, is a typical investor behavior during cryptocurrency bull markets.
In this sense, Matteo Greco, research analyst at Fineqia, details that the bitcoin dominance rate dropped significantly in recent days and these movements usually occur at two “key moments in market cycles: after reaching a high and entering a downtrend, and after reaching a low and starting a new cycle“. “The recent change indicates the entry of new investors into the market, as it occurs after a long period of downward trend“he asserted.
Specifically, this expert believes that the previous increase suggests that investors abandoned several positions in ‘altcoins’ and changed their focus to BTC, waiting for the opportunity to redirect these funds to emerging ‘altcoins’ for the next cycle.
However, experts also believe that these flows will end up being redirected towards the bitcoin as the date of approval (or denial) of the Spot ETF at the beginning of next January.
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“It is difficult, almost impossible, not to remain bullish. An ETF verdict is nine weeks away and institutional traders provide the only significant boost witnessed in the derivatives market. “November represents another solid month for aggressive bitcoin accumulation, with an extended plan to distribute, reduce exposure and reallocate to altcoins once the cat is out of the bag,” notes this expert.
On the other hand, Samer Hasn, market analyst at XS.com, is more cautious and believes that the latest movements and the absence of positive catalysts reinforce the narrative that the latest uploads They are “exaggerated.” For this reason, this expert highlights that, “although the absence of real positive events can maintain exaggerated levels above $35,000 for bitcoin and push sellers to rush.”
Source: Ambito
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