Pentoshi, a pseudonymous strategist with a large following (779,400 on platform X), emphasizes momentum as the key driver of markets. He argues that the rapid launch of new altcoins overwhelmed demand, ultimately tipping the scales in favor of bears.

“In essence, it boils down to basic supply and demand dynamics,” Pentoshi explained. “The constant stream of new coin launches demanded ever-increasing liquidity to maintain their prices. At some point, we needed roughly $200 million in daily inflows just to sustain existing prices.”

This oversupply situation, coupled with widespread investor participation, resulted in a lack of passive buying pressure and readily available liquidity. Consequently, the market witnessed these significant downward corrections.

“We reached an equilibrium point, and then the bears took control for a while,” stated Pentoshi.

The TOTAL3 metric, a popular measure of the altcoin market capitalization, plummeted from its 2024 peak of $788.85 billion to a low of $563.85 billion, reflecting a roughly 30% decline.

Despite the market correction, Pentoshi maintains his belief in the ongoing crypto bull market.

“This isn’t the ultimate bull market peak, in my view,” he clarified. “It’s merely a local top. A true bull market ends when there’s an essentially infinite supply and no more buyers left. We’re not there yet, in my opinion. Stay positive, and there could be good opportunities in the coming weeks.”

Pentoshi shared a chart analysis of TOTAL3, suggesting potential support around $600 billion before a recovery and a subsequent rally towards a $1 trillion valuation.

“Overall, I view this as the beginning of a fantastic new opportunity,” concluded Pentoshi. “The situation could change if Bitcoin loses its market structure or we see significant Bitcoin outflows from ETFs. While that’s possible, it hasn’t happened yet. These things tend to go both ways. For now, this is likely just one of several 30%+ corrections we can expect throughout the cycle, similar to what we’ve seen in the past.”

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Bitcoin has reached a resistance zone with the recent uptrend. Since there is no selling pressure, there is a high probability of an upward movement. If there is a daily closing above $44,300, the next move could potentially continue to the $45,000 – $46,000 levels.

‣ Bitcoin (BTC): The BTC/USD pair is currently trading at $44,130 with a 0.55% increase. Resistance levels for BTC are in the range of $44,000 – $44,400, and support levels are in the range of $42,000 – $41,800.

‣ Ethereum (ETH): The ETH/USDT pair is currently trading at $2,266 with a 1.15% increase. Resistance levels for ETH are in the range of $2,294 – $2,386, and support levels are in the range of $2,150 – $2,077.

‣ Rose (ROSE): The ROSE/USD pair is currently trading at $0.118 with a 7.74% increase. Resistance levels for ROSE are in the range of $0.178 – $0.237, and support levels are in the range of $0.092 – $0.082.

‣ WorldCoin (WLD): The WLD/USD pair is currently trading at $3.67 with a 4.03% increase. Resistance levels for WLD are in the range of $3.78 – $4.18, and support levels are in the range of $3.49 – $2.65.

‣ Render (RNDR): The RNDR/USD pair is currently trading at $4.46 with a 3.84% increase. Resistance levels for RNDR are in the range of $4.57 – $4.75, and support levels are in the range of $4.26 – $4.03.

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