Altcoins have yet to explode - Bitcoin still holds the advantage

Speculation about the potential explosion of altcoins continues, especially in the context of investors trading more cautiously and selectively. However, new data shows that the current trend still supports Bitcoin as the main destination of the market.

Dull Hopes for altcoin

The latest analysis from Matrixport raises questions about the potential for altcoins to record a significant price increase as Bitcoin remains the only reliable asset in the current market. The report indicates that for altcoins to grow, Bitcoin's dominance must decline significantly.

However, the current market conditions do not support this. Retail investor participation is declining and speculative activity in the futures market has nearly hit the bottom of the cycle, indicating that most of the market has no demand for any risky assets other than Bitcoin.

The main demand is focused on buying Bitcoin spot, rather than trading with leverage. Although the price increase of Bitcoin is happening slowly, BTC is still considered the safest trading asset, especially as analysts forecast a period of accumulation in the summer, similar to last year's price behavior.

Cautiously optimistic in the context of concerns about June

Historical data shows that June is usually a month of high volatility and results that are not as expected for Bitcoin. With an average return of only 1.9% and a profitability rate of 50%, the performance of the "king of the coin village" in June was far inferior to explosive times such as October. Last year's patterns are a reminder of the risks as Bitcoin fell by more than 7% in June, recovered only 3.1% in July and fell further 8.7% in August.

This seasonal weakness has resurfaced in recent price action, in line with the cautious attitude of many investors at the beginning of the month. As historical patterns influence market sentiment, traders are preparing for a less active trading period around the middle of summer.

Currently, the Fear and Greed Index of cryptocurrencies is at 57, indicating that sentiment is in the "Neutral" zone. According to data from Reflexivity Research, this marks a shift from previous weeks when market sentiment frequently resided in the "Greed" zone. Traders nowadays seem more cautious as both strong optimism and panic sentiment cannot dominate trading activity.

The decline from the 75 point level of the previous month indicates that the overall optimistic sentiment has weakened, possibly due to the market being in a consolidation phase and mixed signals. In other words, investors seem to be in a waiting state, expecting a clearer trend to emerge soon.

Justin