Bitcoin (BTC) has entered red territory, trading near $103,600 after losing over 10% in the past week. As traders brace for a possible drop below $100,000, attention is shifting to certain assets. Analysts identify three altcoins that can benefit from a Bitcoin crash due to their independent movements.
Firstly, Tezos (XTZ) shows signs of independence. XTZ maintains a –0.07 yearly correlation with Bitcoin, suggesting a slight opposite movement. On-chain data, like the Chaikin Money Flow (CMF), hints at early accumulation by large investors. To confirm momentum, XTZ needs to surpass the $0.55 resistance.
On the other hand, Pi Coin (Pi) presents a stronger case. Its yearly correlation is –0.30, a much more significant negative divergence. While Bitcoin fell 10% this week, Pi barely budged 1%. Indicators suggest that “smart money” expects a bounce if Pi manages to reclaim the $0.26 level and break $0.29.
Finally, Zcash (ZEC) shows the most drastic shift. Although its yearly correlation is mixed, its monthly correlation has plummeted to –0.55. This indicates ZEC is moving almost completely opposite to BTC recently. The asset is up 200% in the last month, while BTC was falling.
Is it possible to hedge against Bitcoin’s volatility within the same market?
Most cryptocurrencies tend to follow Bitcoin’s direction. When the market leader falls, it drags down most assets. However, assets with negative or minimal correlation are crucial. These allow investors to diversify their portfolios, as they offer a potential hedge against BTC’s bearish volatility.
The analysis of these assets suggests an alternative strategy for traders. It’s not just about selling, but about rotating capital into assets demonstrating independent strength. The strong capital inflow into Zcash, confirmed by a CMF at 0.18, signals that large holders are already taking positions. For Tezos, staying above $0.51 is vital to keep this bullish thesis alive.
If Bitcoin fails to hold the psychological $100,000 support, selling pressure could intensify. In that scenario, Tezos, Pi Coin, and Zcash are technically positioned to capture attention. Investors will closely watch if these altcoins that can benefit from a Bitcoin crash manage to decouple effectively or if BTC’s gravity pulls them down anyway. The next critical support for ZEC is located at $341.
