Bulls came March-ing back as altcoins took flight | Trading Ideas| OKX Academy

Market Watch Monthly — A look at the crypto market’s developments and performance in March 2022

Key takeaways

  • March 2022 saw BTC fall as low as 37,158 USDT — forming a higher low after February’s drop.
  • BTC closed slightly below February’s peak of 45,900 USDT.
  • February’s wick-low remains untouched.
  • Altcoins gained serious traction, with strong trend reversals leaving optimism for an “altseason” to come.

BTC buyers outpace sellers near end of March

BTC got stuck in a range between 35,000 USDT and 44,500 USDT as news loomed around the United States Federal Reserve raising interest rates. The continued Russia–Ukraine armed-military conflict created market-wide volatility as traders looked to lock in profits and hedge for multiple potential outcomes. 

OKX BTC buy-volume data shows buyers have stepped in to outpace sellers toward the latter half of the month. This is a key indicator in suggesting that market sentiment is shifting toward positivity.

BTC buying and selling spot volume data. Source: OKX

Glassnode’s accumulation-trend model backs up the OKX data by showing a near-equilibrium between accumulators and distributors — while the market tries to define just how realistic this price action is (and whether bulls can sustain it in the coming weeks or months). 

Bitcoin accumulation and distribution trends remain relatively flat. Source: Glassnode Insights

Do Kwon single-handedly injects BTC buy pressure

BTC gained some serious traction and found support following the announcement of Do Kwon backing Terra stablecoin UST’s reserves via a planned total purchase of $10 billion worth of the market-leading cryptocurrency. This purchase — given time to see how it unfolds — could invite other large projects and companies in the world to take a bet and do the same, as a means of collateralizing their assets to decentralization.

Terra’s Do Kwon claims BTC reserves “open a new monetary era.” Source: Do Kwon’s Twitter

Altcoins gain serious traction as BTC breaks downtrend

While the month of March was very volatile, it presented opportunities for both buyers and sellers — with the former finishing stronger and taking the reins leading into April’s open. 

The total altcoin market cap saw a sharp trend reversal from its March bottom of $921 billion and rallying to over $1.24 trillion — adding $326 billion in just 24 days.

The total cryptocurrency market capitalization, excluding BTC. Source: TradingView

As BTC led the market up by breaking its multi-month downward and sideways choppy price action since November 2021, ETH brought buyers back into the market — leading many altcoins to outpace BTC in terms of percentage gains. 

Among the top coins and tokens by market capitalization, the three biggest gainers were Solana’s SOL at +22%, Cardano’s ADA at +15%, and Terra’s LUNA at +10% — per price differences between the monthly open and close. 

March 2022 was a sea of green for the wider cryptocurrency market. Source: COIN360

DeFi TVL showing strength as volumes rise

Decentralized finance protocols saw a loss of around $5 billion before seeing some relief and rallying back up by more than $10 billion — signaling investors are more confident in locking their tokens up to earn yield. This has led to rising total values locked in the DeFi sector, which is decidedly bullish.

Total value locked in DeFi protocols rose in the latter half of March 2022. Source: DeFi Pulse

Another important benchmark worth observing is the total DeFi user count, which has continued to grow at an exponential pace — even while the total dollar-value locked isn’t at an all-time high. This highlights the constant noise surrounding regulatory and political issues has not deterred new entrants into the DeFi sector.

The total number of DeFi users continues to grow. Source: Dune Analytics

Monthly decentralized-exchange volume from Dune Analytics, however, shows that total DEX volume has been on a downward trend since November after losing its $100 billion milestone. 

Monthly DEX volumes remain in decline. Source: Dune Analytics

Looking ahead to April 2022

As March was able to continue February’s green close, hopes remain high that April can do the same while presenting buyers with more opportunities. April is traditionally seen as one of the more bullish months for overall percentage returns for BTC — averaging a 37.5% positive return.

Average BTC monthly returns. Source Bitcoin Monthly Return

From a technical analysis perspective, BTC would need to remain above February’s close of $43,150 to keep the bullish sentiment rolling. 

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Source: https://www.okx.com/academy/en/bulls-came-marching-back-as-altcoins-took-flight