The Winklevoss FUD set Bitcoin back, and that set alts back, but both Bitcoin and alts are still setup to break out of the 2018 bear market. Of course, being setup and actually doing are two different things.
First, let me start with a story, and then I’ll quickly explain what I mean.
On July 25th Facebook stock tanked 20% aftermarket due to them missing earnings (because they are generally improving UX). Then on July 26th the Winkelvoss ETF re-submission got rejected, and that caused a pullback in the Bitcoin market. At that time Joseph Young (a crypto talking head) made a funny point. He said:
Selling bitcoin because you expected Cboe ETF to be approved but Winklevoss ETF got rejected is like selling Twitter shares because Facebook plunged 22%.
Those two are not the same!
— Joseph Young (@iamjosephyoung) July 26, 2018
NOTE: You see everyone was waiting for the CBOE/Solidx ETF for very specific reasons, so panicking over another ETF rejection made little sense (it was just one of many rejections).
The thing is, in response to the FB selloff Twitter was like “hold my beer,” as on July 27th it too dropped 20% (as did a few other notable tech companies).
The reality is, while selling off Twitter because Facebook missed earnings is nonsensical in most ways, it isn’t fully irrelevant. It turned out Twitter also missed earnings-ish (an overly simple take on what actually happened, but not the point).
Anyway, point being, the end result is that selling Twitter because Facebook is exactly the sort of thing that markets do (especially after a nice run).
Bitcoin just had a nice run, and for technical, legitimate, and FUD-y reasons it then had a minor correction and that created a minor correction in the altcoin market.
That ain’t nothing to write home about, corrections happens all the time after runs (“just give me a reason” investors say). However, it matters a bit more then usual as it happened at a key moment just as alts were all setting up to form a bunch of golden crosses (a bullish set-up) and Bitcoin was gearing up to break out of one of many key resistance levels.
Luckily, the pullback in Bitcoin has created an even more bullish setup. It created an inverted head and shoulders pattern on Bitcoin (see 2hr chart), and alts for the most part all managed to stay above key levels (meaning they still are setup to break out).
If you want the details on what that breakout might look like, see our page on that. That point being, we are set up for “so much winning” and if Bitcoin starts winning, the hope would be that alts are like “hold my beer”… because markets are like that.