Altcoin momentum has weakened sharply after a rally that stretched from late August through early October, with more than $134 billion leaving the sector over the past 15 days. Data shared by analyst Darkfost shows that 48.4% of Binance-listed altcoins now trade below their 200-day moving average, a sign of deteriorating market breadth, while analyst Michael van de Poppe pointed to growing fear among traders during the correction.

Mid- and small-cap assets recorded the strongest monthly growth ratios at 41%, compared with Bitcoin's 7% and large caps' 3.5%, even as the sector has since recorded substantial outflows.

Binance Altcoin Breadth Drops as Outflows Accelerate

According to figures Darkfost shared on X, more than 90% of Binance-listed altcoins traded above their 200-day moving average during the recent rally. The share of coins trading below that level dropped from 81% to under 10%, confirming broad upward momentum at the time.

That trend has since reversed. 48.4% of Binance-listed altcoins now sit below the key long-term technical indicator, meaning nearly half of the exchange's tokens have fallen beneath a widely watched measure of long-term trend strength — a benchmark many traders use to gauge whether an asset is in a sustained uptrend or downtrend.

Darkfost also reported that altcoins attracted more than $814 billion in inflows during the rally before losing over $134 billion in the past 15 days. The analyst attributed much of the recent outflow to rapid profit-taking. For scale, the withdrawn amount is roughly one-sixth of the rally's recorded inflows.

Breadth figures like these show whether a market's moves are shared across most listed tokens or concentrated in a handful, which is why the above-versus-below-average split is widely used as a gauge of overall market participation.

Mid- and Small-Caps Outperform Bitcoin in Recent Growth

Darkfost noted that mid- and small-cap assets — the portions of the market sitting below the largest tokens by capitalization — recorded the strongest market capitalization growth since late August. Their monthly average market capitalization has moved increasingly above its annual average, with the ratio reaching 41%.

Bitcoin recorded a smaller ratio of 7%, while large-cap assets registered 3.5%. Darkfost said this pattern — in which smaller segments of the market outpaced Bitcoin — differs from the 2023 bear-market recovery, when Bitcoin led the market's advance.

He cautioned, however, that mid- and small-cap assets tend to be more sensitive to market changes, and their stronger recent growth can therefore reverse quickly as conditions shift.

Van de Poppe Highlights Fear During Altcoin Correction

Michael van de Poppe said traders had previously wanted opportunities to buy altcoins during a correction. Now that prices have declined, he observed that fear has made some investors wait for even lower prices.

Van de Poppe added that traders were increasingly concerned the market could enter a longer bear phase. His comments followed Darkfost's data showing weaker altcoin breadth and substantial capital outflows.

Darkfost noted that altcoin sentiment and market performance can change quickly. The latest figures show a retreat from the broad rally recorded between late August and early October. The same indicators that captured the turn — the share of tokens above the 200-day moving average and the direction of sector-wide flows — are the measures that would register any deepening of the pullback or a return of breadth.

Source: Cryptofrontnews