Welcome to this week’s analysis on which altcoins are performing well and which ones are not. You can view the list here:
Macro Update
I have been seeing a lot of concerns regarding the tariffs and what could happen on April 2. I am leaning toward it becoming a bullish catalyst for risk assets over the next 2-3 months because of not only the bottom indicators that triggered in the past couple weeks but also a positive shift in the business cycle that historically has led to a transition from “risk off” assets like gold to more “risk on” assets like the stock market and Bitcoin. Let me share a couple charts to explain. This will likely be a contrarian view because I’ve been seeing everywhere in the media how bullish people are on gold.
I shared this awhile back and it compares Bitcoin to Gold and the US manufacturing ISM. The theory is that the ISM is a real-time gauge of how the economy is doing. When the ISM is below 50, the economy is contracting and the market moves money into “risk off” assets such as gold. When the ISM crosses above 50, the economy is expanding and the market moves from “risk off” to “risk on” assets such as Bitcoin. You can see a pattern here that when ISM crosses above 50, the top in gold is near and then Bitcoin starts its parabolic phase.
As you can see the timing of the gold top can vary. Sometimes the first ISM cross above 50 marks the gold top and then other times, it has taken up to 4 months. Based on the recent data, this model suggests gold will top in 3 months or less. I also have another chart that looks at 8-week candle patterns of gold to identify parabolic price action and has signaled a local top. The 8-week candle patterns are as follows:
- Blue label = 7 consecutive weeks of upside and 1 week of downside
- August 2011 top
- August 2020 top
- Red label = 6 consecutive weeks of upside and 2 weeks of downside
- July 2016 top
- August 2020 top
Another indicator that has marked the last couple major tops is when the 50-week RSI in gold crossed 69.5. This occurred in:
- August 2011
- August 2020
The current reading is 69.3 and we had a blue label trigger on March 3. Since gold has continued to rally and now we have 4 consecutive positive weeks, gold could top within the next month or two and another blue or red label form and 50-week RSI crossing 69.5.
Another question I have been seeing a lot is why does this cycle feel so different in terms of altcoin performance. I think this is also related to the ISM in that it’s been under 50 for over 2 years. In previous cycles, the ISM was under 50 for 6 months in the 2015-17 cycle and for 10 months in the 2019-21 cycle. This is the longest on record for ISM to be under 50 for crypto which I think is contributing to altcoins underperforming. The good news is we had a cross above 50 for the ISM in January 2025 and had another reading above 50 in February so I think the turning point is near. This also suggests we could have a longer cycle where instead of the cycle top occurring in Q4 2025, it’s looking more like Q1 2026 or even Q2 2026. Altcoin performance 12 months later after ISM is above 50 for 2 consecutive months:
- May 2016 = 3500%
- March 2020 = 600%
- March 2025 = ?
Bitcoin Update
Bitcoin is having some downside after this short term rally. Based on this short term fib retracement, 81k is a potential local low. In order to have more confirmation of a reversal, it needs to break out of this trendline. It’s possible that we go sideways here for the next few weeks but based on several bottom indicators, I think we are set to go higher.
As I mentioned in the previous newsletter, we had several bottom indicators trigger in the past couple weeks but it doesn’t mean we are out of the woods yet. The data suggests Bitcoin will be up by 50-100% a year from now so from a long term perspective, that is good enough for me and it’s just patience at this point. I am still monitoring this potentially bearish indicator for the Nasdaq 200 DMA Market Regime. The problem with moving averages is they can become less useful if there is short term shock like the COVID crash in March 2020. Even though price fell below, it ended up launching much higher to go above the 200 DMA. I would let this play out for another week or two to see how price reacts.
Solana Update
Solana is now back inside the pattern so it’s looking like it will revisit the lows around 113-120:
Solana vs. Bitcoin is still holding up on a key support level:
Dogecoin Update
Price looks like it could hold here around 0.16.
Sui Update
Sui started breaking above this trendline but unfortunately has retraced and is now back below. I want to see it break above this trendline for more confirmation of a reversal. It will either bounce here or next levels would be 2.00, 1.80 and 1.55.
Large Caps
For large caps, here’s the ones that stand out on a long term timeframe:
- XRP
- Cardano
- TRON
I think other coins like Solana, Sui or Dogecoin will have a better risk-to-reward at this point.
Pepe has also retraced a bit but it’s holding above this 0.000007 level.
Model Portfolio Update
The model portfolio is now down roughly 7% as the market continues sideways and is showing signs of a reversal:
I pointed out which coins are still in a decent buy zone so be sure to review those if you are still looking to allocate. Otherwise, we sit tight and let the cycle play out monitoring for the cycle top data to trigger.
As I mentioned previously, I think we are showing some early signs of a reversal in the market for risk assets. With gold potentially topping soon in the next 3 months along with the ISM staying above 50, we could see a major shift of money flow out of gold and into Bitcoin and the stock market.
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