Altcoin prices have been on a multi-month decline, leaving many investors wondering if the market will recover. Cryptocurrency analyst Michael van de Poppe believes that the answer to the current situation is not simple. He believes that the altcoin market may be approaching a turning point similar to what happened in previous cycles, just before significant volatility.
Is it time to give up or should we wait patiently?
Altcoins Down 80%: A Special Cycle
The year started with great expectations, especially for altcoins. However, instead of a strong rally, most altcoins have fallen more than 80% from their highs.
This cycle is so different from what we have seen before that it is difficult to compare it to past market movements, says Michael Van de Poppe. The current cycle does not follow normal patterns.
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He believes we are in a period similar to late 2019 or late 2020, times in crypto history that marked bottoms for altcoins before the start of a new bull run.
To reinforce his point, van de Poppe drew comparisons to previous cycles, such as 2016 and 2019. In both cases, altcoins bottomed amid global uncertainty, while gold prices surged. Looking ahead to the present, the same picture emerges: strong gold prices, volatile global markets, and investors turning cautious toward riskier assets.
Why altcoins not moving yet?
Despite Ethereum’s recent 40% gain against Bitcoin, most altcoins have yet to show signs of recovery. Van de Poppe attributes the lack of confidence and positive sentiment in the altcoin space to the main reason.
Currently, even a small amount of selling could push the price lower, however, there is also a quiet accumulation going on; some investors are slowly buying coins at low prices.
What needs to happen next?
Van de Poppe believes that the next move of the market depends on Bitcoin. If Bitcoin can bottom out and rise to around $106,000, this could spark Ethereum again. This second rally is likely to create a strong rally across the entire altcoin market.
When that happens, Short positions can be liquidated, leading to fast and sharp price movements upwards.