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Currency Expert Explains Why Altcoins See More Carnage Than Bitcoin and Ethereum

While the current bear market for crypto further deepened, is Bitcoin down 78%, and Ethereum by 82%. Yet elsewhere in the crypto market, many altcoins are down as much as 96% or more.

In a recent video, Elliott Wave explained to Jason Soni, International Currency & Crypto Analyst, why this is happening and what it means for various cryptocurrencies could mean.

Breakdown of why some crypto assets crash more often than others

Bitcoin price is down more than 78% from all-time highs set in 2021. Ethereum, the second largest cryptocurrency after market capitalizationhas so far posted a retracement of about 82% from the top to the bottom.

As you move down the cryptocurrency ranks, the overall drawdown numbers deepen. Cardano for example, it suffered a 92% drop compared to the top two cryptocurrencies. Solanaonce destined to disrupt Ethereum fell by a staggering 96%.

In a new video titled “Looking at Opportunities for the Next Crypto Bull Market,” Elliott Wave international currency and crypto analyst Jason Soni discusses why – theoretically – this discrepancy exists.

According to Soni, newer altcoins will experience the deepest retracement in their first cycle. As cryptocurrencies mature and go through more boom and bust cycles, retracements are less steep, as we have seen with Bitcoin and Ethereum.

Currency Expert Explains Why Altcoins See More Carnage Than Bitcoin and Ethereum, Crypto Trading News

ETH 2018 versus ADA 2022 | ETHUSD on TradingView.com

Bitcoin sets the standard for bear market corrections

In the video, Jason Soni used a comparison between many of today’s newer altcoins, which followed a similar trajectory and overall loss as 2018’s Ethereum. With each new cycle, new participants join and the liquidity in each asset increases, reducing volatility over time and leading to ever smaller maximum drawdowns.

This is perhaps most visible with Bitcoin. After the first big bull market Bitcoin, the first-ever crypto asset, is down 96%. In the second-ever crypto bear market, BTC is down 86%. During the 2018 bear market, Bitcoin fell a total of 84%. A softer landing might still be possible during this bear market.

Given the severity of drawdowns in most cryptocurrencies and the extremely negative sentiment, this could mean that the end of the bear market is near. At this point, Soni recommends avoiding “social media sentiment” at all costs, saying instead “focus on the patterns.”

“Looking at Opportunities for the Next Crypto Bull Market” video is offered exclusively through Elliott Wave International’s Crypto Trader’s Classroom that delivers Three new in-depth lessons each week from top Elliott Wave analysts. Many instructional videos include specific crypto charts and Trading-Setups using Elliott Wave Theory. You can learn more about Elliott Wave International’s Crypto Trader’s Classroom by clicking here.

Follow @TonySpilotroBTC on Twitter or join TonyTradesBTC Telegram for exclusive daily market insights and technical analysis training. Please note: the content is educational and should not be taken as investment advice. Featured image from iStockPhoto, charts from TradingView.com

Source: Crypto News Deutsch

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