The Altcoin market is experiencing remarkable performance, attracting a significant number of investors. Despite the notable upside momentum of the cryptocurrency assets, investors are advised to proceed with caution, securing gains due to a potentially volatile period.
Partial Profit-Taking Could Be Key To Managing Altcoin Position
As the altcoin market grows persistently, Alphractal, an advanced platform for investment data analysis has urged investors in altcoins to consider taking partial profits from their investments in light of recent market activity.
Alphractal issued the recommendation after citing an interesting trend on the Altcoins Season Index, a key metric that determines the beginning of an alt season based on alts’ supremacy in the market. Given that the guidance comes at a time when the prices of multiple cryptocurrencies are experiencing huge increases, it could be crucial in the coming days to provide traders with a chance to lock in profits ahead of periods of volatility.
Data from the on-chain platform shows that the majority of alts have performed better than the largest digital asset, Bitcoin, in the last 60 days. This implies that altcoins have increased notably in value in comparison to the flagship crypto asset.
Nonetheless, the platform noted that Bitcoin’s dominance may cause a brief local bottom, which suggests that BTC might regain its strength shortly despite a persistent rise of the alt market.
Alphractal’s perspective of partial profit-taking is further backed by a high level of Stablecoin’s dominance. Since the start of 2024, the domination of all Stablecoins has maintained a particular level, making it beneficial to take profits in altcoins and convert them into stablecoins. According to the platform, this move could offer more security and stability to the portfolios of individuals who have been exposed to alts and have experienced substantial gains.
“Therefore, an interesting strategy would be to take partial profits in altcoins and increase exposure to Bitcoin and stablecoins, capitalizing on the favorable moment, especially for those holding altcoins that have appreciated significantly,” the platform added. Thus far, with this guidance, investors will be able to balance optimism with caution within the crypto sector.
Corrections Are Ideal Opportunities To Invest In Alt
In the dynamic world of cryptocurrency assets, huge price growths are mostly followed by a correction. Given the recent uptrend of alts, Michael Van De Poppe, the founder and Chief Executive officer (CEO) of MN Consultancy has forecasted an impending pullback for the tokens along with a flash crash.
Although corrections are likely to happen and a flash crash leading to a significant liquidation crash across altcoins, Van De Poppe has advised investors to remain steadfast and take advantage of the corrections to enter the market, suggesting a promising period of gains.
Featured image from Unsplash, chart from Tradingview.com
