Here’s why sometimes altcoins pump when Bitcoin drops:

• Rotation of Capital: When Bitcoin drops, some traders move their money into altcoins, hoping to catch faster or bigger rebounds. It’s like shifting their bets quickly.

• BTC Dominance Effect: Bitcoin has a “dominance” percentage over the whole crypto market. When BTC weakens, money sometimes spills into altcoins, making them surge. Traders see an opportunity to ride smaller, more volatile coins.

• Short Squeeze in Altcoins: When Bitcoin drops sharply, many people panic and short altcoins too. If too many short positions pile up, a small altcoin price bump can trigger short squeezes, forcing liquidations and pumping prices even more.

• Algorithmic Trading: Some bots are programmed to “buy altcoins” automatically if Bitcoin shows weakness beyond a certain level. It’s like an autopilot strategy that kicks in during BTC corrections.

• Narrative and Sentiment: If a particular altcoin has positive news or hype at the same time Bitcoin dumps (like partnerships, tech updates, etc.), money can flow in fast because traders are looking for a “safe haven” inside crypto.

But, it doesn’t happen all the time.

Sometimes Bitcoin’s crash is too violent, and it drags everything (including altcoins) down.