Opinion: The Market Drops As a Consequence of the Altcoins Correction, Which Have Risen Too Much

Opinion: The Market Drops As a Consequence of the Altcoins Correction, Which Have Risen Too Much

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The expert warned that the current market situation could push many investors into the “FUD (Fear, Uncertainty and Doubt) trap.”

Renowned analyst Nicholas Merten, DataDash channel, warned his subscribers that the correction in the market is being inflated by unscrupulous players. This is done with the aim of lowering the market so that new institutional investors can enter it on the lows. Merten notes that the situation is unstable since the beginning of the year because altcoins soared from 7.5X to 10X. In such cases, the market usually corrects.

This is how natural market mechanisms work. However, this year the pullback has happened due to the coronavirus crisis that brought down the fiat markets. Now a second attempt has begun to correct altcoins and the entire market. Players shouldn’t panic. Now is the time to choose crypto positions (altcoins) for profitable entry.

However, the situation now creates a FUD trap – Fear, Uncertainty and Doubt. This is a well-known manipulation when information about the market is presented in such a way that players have fear and uncertainty about the quality and prospects of the market.

“This happens all the time in crypto markets,” the expert notes.

But in his opinion, bitcoin looks solid even after a few pullbacks. The downtrend hit $10K three times. This gives reason to consider this level as support, from which the upward trend will continue. Following this, after the correction, altcoins are highly likely to continue to rise. In general, Nicholas Merten considers the inflow of capital to bitcoin as a positive fundamental factor for the entire market. There is no reason to fear or panic as long as companies like MicroStrategy and Grayscale invest in BTC.

“So long as there is not massive outflow of Bitcoin, there will likely not be massive outflows of the total crypto market,” the expert notes.

Meanwhile, Michael Saylor, the founder of MicroStrategy, conducted a study on Bitcoin Dominance under special conditions: with no ETH and stablecoins. In this case, Bitcoin Dominance has grown from 71.05% on December 20, 2017 (when BTC had approached all-time highs) to 93.57% today. Meanwhile, the traditionally calculated Bitcoin Dominance is today 58.5%, and on December 20, 2017, it was 45.2%. Michael Sailor proposes to calculate the impact of bitcoin on the general cryptocurrency market using his own method. The tweet inspired an outcry among altcoin and Ethereum supporters.