Is this a good time to build an altcoin portfolio?

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With September traditionally the worst month for Bitcoin returns, and altcoins languishing against the dollar, and bleeding out against Bitcoin, this could be the very worst time for crypto. Is this a good time to start building an altcoin portfolio for the potential recommencement of the bull market?

Alts down 50%, 60%, 70% and beyond

September is proven to usually be the worst month for Bitcoin average returns, and therefore, the chances of seeing an upturn for the whole crypto market during this month are potentially not good.

The alts are beaten down. Many investors will have been shaken out of their alt positions given that many of them are down 50%, 60%, and some more than 70% for this ongoing correction.

That said, it’s arguably precisely at times like these that investors have the best chance of building altcoin positions that can take them through the rest of the bull market, and produce some great gains.

Total3 Market Cap in beautiful bull flag

Source: TradingView

The TOTAL3 chart is the market cap of all cryptocurrencies, excluding Bitcoin (BTC) and Ethereum (ETH). This is showing that the combined market cap for the altcoins is in a fantastic looking bull flag. Candle wicks to the downside have all been bought up quickly, showing that the bulls are very interested in keeping the price up.

The fibonacci levels show that the 0.786 is the base for this entire bull market. A wick down to touch the 0.618 was really important, given how pivotal this level is, and it can be seen that the market cap has been battling resistance at the 0.382 fibonacci level.

At the bottom of the chart, the Stochastic RSI is showing a cross up above the 20 level for the two indicator lines - which is in itself extremely bullish. 

Total Crypto Market Cap looks bullish

Source: TradingView

If we then include both $BTC and $ETH into the mix, in the Crypto Total Market Cap (market capitalization of all cryptocurrencies), we see a similar pattern. Another beautiful bull flag is forming, and the market cap price has wicked down to touch the deepest 0.786 fibonacci level at $1.73 trillion. The market cap is currently holding nicely above the 0.618 fibonacci, which is acting as support.

Also, after two fake outs already in the Stochastic RSI at the bottom of the chart, the indicator lines look as though they could venture upwards again. You would have to go back to the bear market of 2018 to find another time when there were more than two fake outs in the weekly Stochastic RSI, and even then, after the third fake out, there was a huge 320% surge to the upside.

A great time for building an altcoin portfolio

So for those thinking ahead, could this be a great time to start dollar cost averaging into certain altcoins? As long as one keeps in mind that there will still probably be a lot of volatility, to the downside as well as the upside, the eventual gains could well outweigh the risks.

Sentiment is very low right now across the entire crypto market. September is usually a difficult month for Bitcoin, and the Fed rate cuts that are forecast, might not have the positive liquidity effects that the market expects. Seems like a great time to build an altcoin portfolio …

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.

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