The crypto market is always active and never asleep, especially with altcoins fully awake. Jason is an intrepid explorer and astute chronicler of the cryptocurrency frontier. He’s been following the moves of a number of altcoins that are shaking things up. He notes that Pi Network (PI), Kaspa (KAS), and Peanut the Squirrel (PNUT) are among those leading what appears to be a 'risk-on' rally. Investors are becoming more reckless and more incentivized to take risks. They are moving away from the calm waters of more established, safer cryptos like Bitcoin and Ether and entering into the much deeper, risky world of altcoins.
This change isn’t just a cynical ploy to pursue short-term profits. It’s indicative of a larger feeling in the crypto space. With Bitcoin’s dominance finally starting to lose its grip, investors have made a beeline towards finding the next great altcoin. These smaller, often newer, cryptocurrencies can deliver big profits if you get the timing right. These types of investments are of greater risk. It’s critical for investors to understand what drives their price movements. So, careful, thoughtful due diligence and analysis is very important before getting your feet wet with the altcoin market.
So, with that in mind, he gets into a few key factors that could spark an altcoin rally. Positive news, technological advancements, growing adoption, and overall market sentiment all have a significant impact. The recent comeback of PI, KAS and PNUT shows the different fundamentals that cause altcoin pumps. Real estate investors should focus on being informed and agile to be able to succeed in this fluid marketplace. Grasping these dynamics helps readers prepare to make sense of the nuances of the altcoin space. Only then can they make informed decisions that don’t forget the fact that the crypto market is volatile by nature.
Pi Network (PI): Riding the Wave of Anticipation
Pi Network (PI) has been on fire, skyrocketing 105% in just 12 days to $1.25. This strong growth immediately precedes the ecosystem development event expected to boost rumors and excitement in the Pi community. Jason points to this kind of speculation as one of the major forces behind PI’s recent price movement. Investors are optimistic about the potential positive effect the announcement will have on the Pi Network ecosystem. This excitement, speculation, and FOMO combined are creating more buying pressure.
From a technical analysis standpoint, Pi Network price performance is very bullish. At the moment, the price is sitting above both the 50- and 100-day EMAs on the 12-hour chart. This is a bullish continuation signal, indicating that the current uptrend has a high probability of continuing. EMAs are valuable because they can help you quickly spot the direction of a trend. When the price is above these averages, it just tells the trader that the asset is in an uptrend.
In addition to promoting this environment for growth, Jason warns readers about the dangers that come with that quickly produced growth. The Relative Strength Index (RSI) for Pi Network has already blasted into the overbought territory. It currently looms above 70, even reaching as high as an impressive 91.61. This often means that the asset is overbought and primed for a pullback. An overbought RSI indicates that the price has gone up too fast and that a correction is overdue. Despite the powerful bullish momentum, investors should be on guard for the possibility of a short-term pullback or consolidation. That is a 138.13% increase over the past 7 days, amazing.
Kaspa (KAS): Aiming for New Heights
Kaspa (KAS), another altcoin that’s been on a tear, has continued to push higher, fueled by soaring trader sentiment amid an undeniable uptrend. The current $0.18 target for KAS is telling of the overall optimism about the project's potential. Indeed, Jason sees KAS as having a very solid bullish structure. At present, the price trades above the 50-, 100- and 200-day EMAs. To top it off, this further fuels the bullish sentiment surrounding the cryptocurrency.
Kaspa’s price is sitting close to a key breakout. If it breaks above the closest resistance level at $0.14, it may trigger further bullish momentum. Resistance levels are price points where selling pressure is likely to overwhelm buyers and stop the upward march in its tracks. A breakout above this level would likely indicate the uptrend continues.
There’s one unwanted headwind that Jason wants to flag for Kaspa. ChainGPT is one of the altcoins with a token unlocking planned next week. Since token releases increase the circulating supply of a cryptocurrency, this increase can add serious selling pressure, driving the price down in the process. Specifically, investors need to know how this major event could affect the price of KAS. He cautions that Kaspa’s price volatility can be rapid. It’s a bet worthwhile making, but the downside is steep if the market moves against you. Therefore, careful risk management is essential.
PNUT (Peanut the Squirrel): A Nutty Rally
Peanut the Squirrel (PNUT) may sound like a meme coin, yet it has been demonstrating impressive bullish activity. Jason’s observation PNUT’s price is currently around its recent weekend peak $0 and 46. Even with a modest drawdown today, it is still near that peak. This is a sign that the bullish momentum is still healthy, even after a small slip-up like this.
PNUT is now comfortably above the 50-day ($0.26) and 100-day EMAs ($0.29), providing additional confirmation of its bullish trend. That upward momentum is undiminished, now settling comfortably above $0.40. Such persistence, even in very overbought territory, illustrates the strong bullish undercurrent that is accompanying this coin.
While PNUT is a promising lesser-known altcoin, Jason warns that you still need to exercise caution investing in these types of altcoins. Unfortunately, there is scant information currently available about PNUT, which prevents a meaningful evaluation of the proposal’s potential risks and rewards. These information gaps mean it is more important than ever for investors to do their own due diligence and tread carefully when investing. Either way the extremely overbought conditions are going to pull this market back. You can see a traders sell off attempt at liquidity and support around the 100-day EMA, currently $0.29. After an extended rally, overbought conditions can often precede a pullback in reaction to at least some profit taking, possibly bringing a retest of this essential support area.
Overbought Conditions: A Word of Caution
As an altcoin trader, Jason emphasizes the necessity of being able to identify overbought conditions. With this in mind, an RSI above 70 (such as PRIME and BAL) shoots up red flags regarding the sustainability of the uptrend. When periods get overbought, it often sets up for a pullback as some investors are likely to take profits. Investors who have ridden the moon shot may want to lock in gains and cash in their chips. This seller action has the potential to lead to a purchase price reduction.
AIXBT, with an RSI of 73.92, is technically overbought but is still playing catch up to the broader market. This means that while its rally has been steep, it has not been as strong relative to other assets. Although AIXBT has some potential upside at this point, investors need to be cautious of a medium-term pullback. Yet, he warns against using RSI too much for decision-making. Keep in mind though, it’s only one of the tools you can use in technical analysis arsenal.
Important pullbacks will often lead to a retest of crucial support points. For PNUT, that level is the 100-day EMA at $0.29. Support levels are price points where selling pressure is predicted to rise, stopping the upward trend in its tracks. When a strong support level is retested, it provides investors with an opportunity to buy the dip. This strategy carries the danger of the price falling below the support level, which leads to much higher losses.
The Altcoin Season: A Shift in Momentum
During the broadcast, Jason commented on this recent trend favoring smaller altcoins. That trend, particularly in areas like DeFi, infrastructure, and smart contract platforms like Solana, is indicative of a market where investors are looking for opportunities outside of large-cap tokens. This rotation into altcoins is a typical hallmark of an altcoin season, where large caps such as altcoins outperform Bitcoin and Ethereum.
Investors are naturally drawn to these altcoin seasons, as there is the promise of greater returns on investments to be made. They require a greater measure of risk. The altcoin market continues to be highly volatile while swinging in the favor of Bitcoin and Ethereum. Smaller altcoins are particularly susceptible to volatile price fluctuations.
The Altcoin Season Index
The Altcoin Season Index indicates when the top 50 altcoins outperform Bitcoin on average. Investors should find this tool useful in understanding the most important indicators and making a more informed investment decision. This index offers a complete picture of the altcoin market, enabling investors to spot key trends and opportunities. Jason suggests monitoring Bitcoin dominance. A drop in Bitcoin dominance is usually the first sign that altcoins are beginning to take priority and that an altcoin season is coming. Investors would be wise to watch this metric closely to find opportunities.
Diversification and Risk Management
To take serious crusier rocket profits Jason’s #1 crypto portfolio management tip during altcoin season is to prioritize diversification & set stop-losses. Diversification Diversification is the process of spreading your investments across multiple altcoins. This strategy protects you from taking a big loss if one particular altcoin fails to pan out. Stop-losses are simply orders placed to sell an altcoin once it hits a certain price, capping potential losses.
- Diversification:
- Investing in a variety of altcoins across different sectors (DeFi, infrastructure, etc.)
- Avoiding over-concentration in a single altcoin.
- Stop-Losses:
- Setting predetermined price levels at which to automatically sell an altcoin to limit losses.
- Adjusting stop-loss levels as the price of the altcoin moves in your favor.
Sentiment Indicators
Understanding sentiment indicators gives investors more power. This methodology allows traders to better hitch their methods to wherever market emotions are running highest and ride robust worth swings throughout altcoin seasons. Sentiment indicators measure the emotional state of the market, helping advisors and investors alike understand when market participants are feeling optimistic or pessimistic. These data go a long way in helping traders make better prediction-based trades.
- Social Media Analysis:
- Tracking mentions and sentiment surrounding specific altcoins on platforms like Twitter and Reddit.
- Identifying trending topics and gauging the overall community sentiment.
- Fear and Greed Index:
- Monitoring the Crypto Fear and Greed Index, which measures market sentiment based on factors like volatility, social media, and Google Trends.
- Interpreting the index to determine whether the market is in a state of fear (potential buying opportunity) or greed (potential selling opportunity).
Navigating the Altcoin Landscape
Jason also reminds us that the altcoin market can be very unpredictable with boom and bust cycles. While the potential for high returns is enticing, it's crucial to approach altcoin investments with caution and a well-defined strategy. Learn what makes altcoins pump and dump. Identify overbought conditions and apply best risk management practices to help you trade the world of altcoins with more certainty.
He wants to remind you that this article provides you with educational information only. You’re making a mistake if you take it as investment advice. The crypto market is highly risky. As always, do your own research and contact a fiduciary financial advisor before investing.
