A prominent cryptocurrency analyst, known by the alias Pentoshi, has adopted a more optimistic outlook for altcoins as the total market capitalization of cryptocurrencies has now exceeded $3 trillion. According to Pentoshi, a significant market movement may be triggered once the total value of the cryptocurrency market, excluding Bitcoin and Ethereum (referred to as TOTAL3), surpasses the $790 billion mark.
Pentoshi cautioned that while upward momentum in TOTAL3 is expected, market corrections will occur. “Prices do not move in a straight line,” he explained. “Along the way, we will encounter fluctuations, bull traps, and bear traps. However, such movements present opportunities for investors.” He further noted that he plans to assess pullbacks as they happen and strategically add positions.
Bitcoin vs. Altcoins: Key Differences
Pentoshi highlighted the divergence between Bitcoin and altcoins in terms of market behavior. While Bitcoin is unlikely to experience the significant corrections seen in previous bull cycles, altcoins may still face substantial price declines. Reflecting on past cycles, where Bitcoin underwent corrections of more than 20% up to eight times in a year, Pentoshi believes such sharp retracements will be rarer this time around. In contrast, the altcoin market remains more susceptible to major pullbacks.
“Significant corrections in altcoins are inevitable,” Pentoshi stated, pointing out that such declines often result in the liquidation of highly leveraged positions and a broader market rebalancing. He also noted that these corrections typically present prime buying opportunities for investors.
Pentoshi anticipates that altcoins could experience sizable corrections—of 15-20% or more—on a frequent basis, particularly in a bull market. “These large, single-day declines often create opportunities for quick profits,” he remarked, stressing that investors should remain vigilant and prepared for such volatility.
A Volatile, High-Gain Environment Ahead
With these dynamics in mind, Pentoshi predicts that the crypto market will enter a period marked by significant volatility and potential for substantial gains. Altcoin investors, in particular, will need to stay alert, as the environment is primed for both dramatic price movements and profitable opportunities. The analyst emphasized that success in this market will require readiness to take advantage of market fluctuations while managing risk.
