Why is Bitcoin dumping? Bitcoin recently fell below $62.5k, hitting a new monthly low. Analysts note that while this price action isn’t ideal, it’s not unusual for Bitcoin and altcoins. However, despite the sideways movement, this period is seen as a good time to position or reposition portfolios for future success. Major market dips should be viewed as opportunities to add to quality altcoin positions.
Analyst Miles Deutscher recently discussed the current state of the cryptocurrency market, focusing on Bitcoin and altcoins. He gave various examples of why Bitcoin might be dropping.
Summer Lull: The reduced activity is typical of the summer months. Historically, the crypto market experiences a lull during summer, even in bullish years. According to reports, Historically, Q3 trading volumes are much lower. Bitcoin trading volumes typically drop by more than 40% compared to the busiest quarter.
Miles said that in 2017, altcoins underperformed compared to Bitcoin. In 2019, the market peaked at $13k before undergoing a correction. During 2020, “DeFi Summer” occurred as investors were risk-averse. In 2021, a bearish trend continued until Elon Musk’s tweet in July. The market significantly tanked in 2022, and in 2023, it moved sideways.
He added that many traders and funds reduce their activities in July and August, contributing to the market’s sideways movement. This period is often less clear from a macro perspective, but later in the year, optimism usually returns, reflected in better market performance in Q4 and Q1.
Total 3 Chart Analysis: The Total 3 chart, which excludes Bitcoin and Ethereum, shows that altcoins are currently within a range, moving sideways after a dip. Both the altcoin market and Bitcoin are in a range with lower volume and volatility compared to earlier in the year, especially during the price surges in March and April.
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