Here’s Why BTC and Altcoins Like Pepe, EOS, Bonk, and Fartcoin Are Rising
The crypto market rebounded slightly on April 1, as investors took advantage of lower prices following a tough quarter. Bitcoin (BTC) and Ethereum (ETH) saw sharp declines of 12% and 45%, respectively, during this period. However, BTC climbed back to $84,000, while altcoins such as Pepe, EOS, Bonk, and Fartcoin gained over 5% in the last 24 hours. Meanwhile, total trading volume across exchanges increased by 18%.
This rally was particularly notable as U.S. stock index futures continued their downward trend. Dow Jones futures slipped by 250 points, while the Nasdaq 100 and S&P 500 both dropped by 0.50%.
Declining Exchange Balances Signal Lower Selling Pressure
One key factor supporting Bitcoin’s and altcoins’ rebound is the declining exchange balances, suggesting reduced selling pressure.
- Bitcoin balances on exchanges fell from 2.25 million in March to 2.2 million in April, according to CoinGlass.
- Ethereum holdings on exchanges also dropped to 14.5 million ETH, marking their lowest level in years.
A decrease in exchange balances often signals accumulation, as investors transfer assets to cold storage, reducing immediate selling pressure.
Is This Rebound a Dead Cat Bounce?
Despite the short-term recovery, analysts warn that this could be a dead cat bounce—a brief price recovery before a continued downtrend.
- A dead cat bounce, also called a bull trap, happens when an asset in a bearish trend temporarily rallies, only to plunge further afterward.
- Several macro risks remain, which could stall the crypto market’s recovery.
One major risk is Donald Trump’s anticipated “Liberation Day” announcement on Wednesday. Reports suggest he may unveil aggressive tariffs to fund tax cuts and boost U.S. manufacturing.
- Potential retaliatory tariffs from the European Union could trigger a trade war, increasing inflation and forcing the Federal Reserve to delay interest rate cuts.
- Higher inflation and delayed rate cuts could push risk assets like Bitcoin and altcoins lower.
Bitcoin’s Technical Indicators Point to More Downside
While Bitcoin and altcoins like Pepe, EOS, Bonk, and Fartcoin have rebounded, technical analysis suggests more downside risk.
- BTC remains below its 50-day moving average, a sign that bears are still in control.
- The price failed to break above the $89,156 resistance level, which serves as the neckline of a double-top pattern from the $108,410 high.
- A break-and-retest pattern has already occurred, confirming the bearish outlook.
If this bearish trend holds, Bitcoin could retest last month’s low of $76,485. Until BTC reclaims the $95,000 resistance level, the downtrend remains intact.
What This Means for Altcoins
If Bitcoin’s downtrend continues, altcoins like Pepe, EOS, Bonk, and Fartcoin could follow suit. These assets often mirror BTC’s price action, meaning a further drop in Bitcoin could erase their recent gains.
For now, traders should remain cautious, as this rally may be short-lived in the face of looming macroeconomic risks and bearish technical signals.
