BTC Dominance: Overbought Altcoins and Reversion to the Mean

14 jul 2023

With many altcoins appearing overbought in relation to Bitcoin (BTC), as evidenced by the Relative Strength Index (RSI) across multiple timeframes and lengths, there is a strong possibility of a reversion to the mean (a BTC Dominance bounce up from around the physiological 50% level).

Most often it is argued to not use the RSI as an oversold/overbought indicator but I have always found it very useful when used in confluence with many lengths and timeframes, as a mean reversion indicator. (as seen in this chart)

Although I don't have a predefined profit target or stop-loss in this scenario, the chart suggests a potential reversion to the mean for BTC gaining strength over the rest of the cryptocurrencies.

29 ago 2023

Nota

40 of the top 50 cryptos by market cap are down against their BTC pairs, although BTC Dominance is approximately the same currently.


--------------🔴Loss Against BTC Pair--------------
ETH 2.3%
BNB 0.1%
XRP 25.5%
ADA 12.8%
SOL 6.3%
DOT 4.5%
MATIC 21.5%
LTC 23.8%
BCH 8.1%
AVAX 13.5%
XLM 9.8%
LINK 1.8%
UNI 7.4%
XMR 0.4%
ATOM 15.3%
ETC 4.2%
ICP 4.7%
FIL 15.6%
LDO 16.5%
APT 10.9%
CRO 0.5%
ARB 10%
VET 12%
NEAR 5%
AAVE 14.8%
GRT 13.5%
ALGO 6.3%
STX 15%
AXS 15%
XTZ 8%
SAND 20.8%
EOS 12%
EGLD 19.4%
IMX 12%
BSV 3%
THETA 13.9%
INJBTC 5.5%
FTM 20.1%
MANA 20%
APE 15.7%
RNDR 20.9%

--------------🟢Gain Against BTC Pair--------------
DOGE 6.8%
TRX 7%
SHIB 15%
LEO 7%
OKB 11.7%
HBAR 21%
QNT 9%
OP 23%
MKR 29%
SNX 6.9%