Altcoins in the red - should you sell?

As Bitcoin consolidates just below $90,000, and Bitcoin Dominance continues to go up, is this the time to sell your altcoins and jump onto the Bitcoin bandwagon? 

Will your altcoins outperform Bitcoin?

When holding any altcoin for anything longer than a short period of time, the question must always be asked “Will my altcoin outperform Bitcoin? If the answer is “no”, and this is likely to be the answer for the vast majority of altcoins, then this altcoin will have to come under serious consideration for whether to sell or keep.

Of course, experienced traders will buy and sell altcoins, either day-trading, swing trading, or very short-term scalping. That said, the main question here is whether to sell recently bought altcoins now, and by doing so, avoid more losses if Bitcoin does start to roll over and head back down.

Is this bull market different?

Some are saying that this crypto bull market is different from those that went before. In previous bull cycles, the acknowledged wisdom was that first Bitcoin would run, and then when it stopped, the money would transfer into Ethereum, then large caps, medium caps, and finally small caps, before rotating back into Bitcoin again.

In this bull cycle, Bitcoin has done the major running, and the vast majority of altcoins have bled out against the king of the cryptocurrencies over extended periods of time. Only in the case of a small handful of altcoins has there been any inroads into Bitcoin domination.

Bitcoin Dominance continues to rise

Source: TradingView

Referring to Bitcoin Dominance, it has gone higher again, with a good chance that the 60% resistance level will be flipped into support. Now at nearly 61%, it must be wondered what needs to happen for this inexorable rise to come to a stop, and start reversing? 

With Bitcoin looking at a next leap to $100,000, perhaps in the near future, most altcoins are not going to keep up. The next major target for Bitcoin Dominance is way up ahead at 71%. 

Total3 forms bull flag

Source: TradingView

Nevertheless, if one looks at the Total3 chart (combined market cap of all cryptocurrencies, excluding $BTC and $ETH), it can be seen, just as is the case with Bitcoin, that the price is forming a flag underneath a major resistance level.

Source: TradingView

Total3 setup similar to that of Bitcoin

Zooming right out into the daily time frame for Total3, the view becomes even more bullish. The setup is once again very similar as for Bitcoin, whereby the price has exited through the top of the huge bull flag, has reached resistance after a huge price surge, and is now forming a small flag, which could provide the impetus for a continuation of the move.

Therefore, if this positive scenario plays out, top altcoins could well outperform going into this last stage of the bull market. It will be the job of the investor to make sure that their altcoins are in this select band.

On the other hand, if in doubt, Bitcoin is likely to provide as many gains as the vast majority of altcoins. In addition, future heavy price falls will be a lot easier to bear with Bitcoin, than with most altcoins. Choose wisely.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.