- The altcoin market cap doubled in about two weeks.
- What is causing the current dip and should investors be worried?
- A technical correction happens to correct overpriced assets.
The altcoin market has taken an unexpected dip. As a result, some investors worry about what is causing the dip and how to respond.
The altcoin market started the month of February with a $389B market cap. This had almost doubled to $587B by the 13th of February, based on CoinMarketCap statistics. Also, several altcoins set new all-time highs in this period such as Ethereum, Dogecoin, Binance, and others.
However, experts believe that the dip is the market simply going through a technical correction. As the market is not responding to any new data or regulation, this logic makes sense.
A technical correction is a brief price dip that occurs after a series of high price gains. As a result, the market attempts to adjust prices to reflect their true values. An asset can become overpriced if the market pumps it too hard.
The current correction should allay fears that some assets like Dogecoin have become overpriced after being pumped by several celebrities. Moreover, the market always moves to correct itself and according to crypto advisor Lark Davis, “dips are for buying.”
Davis goes into further detail about what investors should do when a dip occurs in the video below.
In conclusion, do not panic. If you can afford it, hold your crypto for now as the bullish trend is far from over.