#altcoins often lag behind Bitcoin during the initial phase of a Bitcoin rally for a few key reasons:
1. Capital Flow: When Bitcoin pumps, most investors first move capital into BTC, viewing it as the safest crypto bet. Only after BTC stabilizes do they shift into altcoins.
2. Market Dominance: Bitcoin dominance (its share of total crypto market cap) usually increases during a BTC pump, pulling attention and liquidity away from altcoins.
3. Risk Aversion: Early in a rally, traders avoid riskier assets (like low-cap altcoins). They wait for confirmation of a sustained bull market before rotating into alts.
4. Liquidity Drain: Many traders sell altcoins to chase BTC’s momentum, draining liquidity and suppressing altcoin prices.
