Each bull cycle in crypto has its own internal dynamics.
To examine altcoins, legacy investors would look at the BTC parity, not USDT (e.g. ETH/BTC). Because USDT came into our lives in 2014 and USDC in 2018.
However, stablecoins are now an undeniable reality of the cryptocurrency market. Together with stablecoins, bitcoin's own market cap already covers more than 60% of the total cryptocurrency market. Let me immediately explain how I accessed this data. As of the day I wrote this article, the dominance data of bitcoin and the two largest stablecoins are at BTC.D 54.30%, USDT.D 4.45% and USDC.D 1.30%.
Correct Mathematics
How can we track the total market value of altcoins, free from Bitcoin and stablecoins?
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The easiest method we can find when looking for an answer to this question is to follow the "OTHERS" data. OTHERS data calculates the total market cap of all but the top 10 instruments in crypto. We prefer this data because USDT and USDC are now fixtures in the top 10.
“Let him calculate, what is the difference for us from TOTAL2 (Market value of all altcoins except Bitcoin) or TOTAL3 (Market value of all altcoins except Bitcoin and ether)?” I can almost hear you say. When calculating TOTAL2 and TOTAL3 data, we also take into account stablecoins with very high market value such as USDC and USDT. This can mislead us when predicting the price movement of altcoins in general.
The reason for this can be explained as follows: When investors sell altcoins, they switch to stablecoins such as USDT or USDC, which does not create a change in data such as TOTAL2 or TOTAL3. For those investing in altcoins, following this data alone may no longer be enough.
OTHERS Dominans
We have discovered that OTHERS data is an important tool for those looking to invest or gain insight into the cryptocurrency market.
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In addition, we can also follow the Others Dominance (OTHERS.D) data in order to determine the direction of the price movement based on this data. This allows us to track the market dominance of the top 10 external cryptocurrencies.
Increases here may indicate that we are in a general upward trend in altcoins, while decreases may indicate that seller pressure has begun to increase or that the currency has moved into the top 10 (especially stablecoins).
Critical Levels to Follow
If you have read this far, I think you now understand how reasonable OTHERS data is to predict the general price movement of altcoins.
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If we go into more technical details, we are at a very critical level for OTHERS ($260 billion), as I show in the chart above. So why is this level critical? When we examine an instrument with Fibonacci Retracement levels, 0.5 level is the pivot level for that instrument.
We can say that the bulls gained strength when this pivot level was exceeded upwards, and when it was broken downwards, the bears declared their dominance in the market.
In order to talk about a bull in altcoins, we need to see the persistence of the price movement above the level I mentioned in the chart above, especially in OTHERS. When the 260 billion dollar level is permanently exceeded (we want to see at least a 2-week candle in technical analysis for this), we can safely say that the bull season has begun in altcoins.
