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Altcoin Rotation Accelerates After Bitcoin Correction
The crypto market posted a shaky rebound overnight after a historic liquidation event, as traders scrambled to cover positions and reassess directional bias.
In the past 24 hours, over $19.2 billion in derivatives positions were liquidated globally—marking one of the largest single-day liquidation events ever recorded. Roughly 1.64 million trader accounts were affected.
Bitcoin dominance (BTC.D) has held relatively firm at around 65%, though weak rotational signs are emerging. The total crypto market cap dipped sharply during the sell-off but is now reasserting levels near $3.8–4.0 trillion, following a brief breakdown from its recent highs above $4.2 trillion.
Altcoin Rotation Gains Traction
While BTC led the initial downside defense, recent flows suggest capital is rotating back into higher-beta altcoins. Liquidity vacuums and forced deleveraging appear to have cleared crowded longs, particularly in large-cap alt names. As Bitcoin dominance approaches multi-year resistance zones (~65–67%), technical observers point to a possible inflection where alts begin outperforming.
Analysts note that the next altcoin season may no longer depend on a traditional rotation out of BTC, but rather on stablecoin-driven liquidity reallocations. The current market cycle appears increasingly shaped by nuanced trading volume shifts and protocol-specific developments rather than dominance metrics alone.
Expert Voice
“Markets needed a cleansing event to reset overstretched leverage,” said Jackson Moss, Head of Strategy at Nimbus Capital. “Now we’ll see whether directional conviction returns—or if traders remain sidelined until clearer macro cues arrive.”
Another executive at a leading derivatives desk added, “We’re watching how altcoins respond off their lows. If Ethereum, Solana, or smart-contract ecosystems begin stabilizing, it could pull momentum away from BTC late cycle.”
Technical Analysis
- RSI / Momentum: On Bitcoin’s daily chart, RSI has slid into the 35–40 zone, hovering just above oversold levels. A rebound toward 50 would signal an early relief leg.
- MACD: The MACD line is still trending below its signal line, but the histogram is narrowing—suggesting that downside momentum might be decelerating.
- DMI / ADX: The ADX has trended above 30, reflecting that a directional trend was in place. The +DI is clawing back from suppressed levels while –DI dominance softens, implying diffusion of the prior downtrend.
- Support / Resistance: For BTC, support zones near $110,000–$112,000 are key to hold. Resistance lies at $118,000–$120,000, where sellers may re-enter. In altcoins, ETH’s $3,800–4,000 band constitutes immediate defense; a breakout above $4,200–4,400 could reignite broader upside.
Forward Outlook
The market is entering a delicate post-liquidation phase. On one hand, the purge of leverage offers a healthier foundation for renewed trends; on the other, macro uncertainty—especially around rates, regulation, and institutional flows—remains a gating factor.
