A popular crypto analyst says altcoin bulls could be taking on huge amounts of risk as Bitcoin (BTC) continues to weigh down the market.
In a new video, Jason Pizzino tells his 267,000 subscribers that current market conditions may not be favorable for long entries or trying to dollar-cost average (DCA).
“We’re looking at a crypto dangerous move that the buyers are making especially in this Bitcoin shakeout… So many buyers are still getting caught up trying to dollar cost average into cryptocurrencies while Bitcoin is basically giving us a shakeout. Remember our trading range that we’ve been following for nearly two weeks now? Between $28,000 and $31,000, more specifically I’m looking at $31,700.
The crypto investors, the DCAers are really not doing themselves any sort of favor. This is what we’ve been looking at for months and, of course, more recently over the last few weeks.”
Pizzino says that smart money still hasn’t entered the market with enough of a presence to support prices from falling further. According to the analyst, despite altcoins already being down dramatically from their all-time highs, big drawdowns are still in play.
“The dangerous dollar cost averaging method here for altcoins is that there is still the potential to lose 50% to 70% of that value because there has not been any sort of significant bounce. There’s no accumulation range, which means there’s no smart money buying these up yet. There’s no breakout of an accumulation range. This is high risk, it’s extremely dangerous in my opinion.”
Pizzino’s analysis comes as Bitcoin moves closer to taking over half of the total market cap of crypto. He says Bitcoin dominance is signaling that BTC is getting ready to suck vast amounts of capital away from the rest of the market, weighing down on altcoins.
“Right now, I think it’s big Bitcoin season. It’s been Bitcoin season for the last few weeks. You can see that these lows were put in here at around 41% so this is the dominance, or how much share Bitcoin has of the total market cap and this has been increasing, so 41%, were now at 46%. The next level’s up at 50% level are 56% dominance of the whole market, so Bitcoin would basically take back over half of the total market cap.”
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Source: https://dailyhodl.com/2022/05/27/crypto-analyst-says-altcoin-bulls-are-taking-a-dangerous-gamble-as-bitcoin-dominance-surges-heres-why/