Altcoins Slip as Market Cools Off
Altcoins, including Ethereum (ETH) and Dogecoin (DOGE), experienced a pullback Tuesday morning, retracing gains from last week’s rally fueled by President Trump's crypto-friendly policies. Hedera (HBAR) and Hyperliquid (HYPE) led the losses among the top 20 cryptocurrencies by market cap, dropping 5.2% and 5.1%, respectively.
Key Altcoins in the Red
- Ethereum (ETH): -2.6%
- Chainlink (LINK): -3.3%
- Dogecoin (DOGE): -1.5%
- Stellar (XLM): -4.1%
- Cardano (ADA): -2.8%
- Sui (SUI): -2.8%
This market correction follows a week of euphoria after XRP hit an all-time high above $3.41, a seven-year record, driven by renewed institutional interest.
"Healthy Correction" After Euphoric Gains
Analysts view the pullback as a "healthy correction" following strong double-digit gains in recent weeks. Illia Otychenko, Lead Analyst at CEX.IO, noted that profit-taking is common after such rallies, especially when momentum indicators like the daily RSI show overbought levels.
"Rather than signaling weakness, such corrections could be necessary to solidify the foundations for a sustained rally," Otychenko said.
Arthur Azizov, founder of B2 Ventures, highlighted XRP's exceptional momentum before the pullback, suggesting a correction to around $2.64 would be normal, with $1.90 as a critical support level to maintain the bullish trend.
Post-Euphoria "Hangover" Amid Regulatory Catalysts
Bitcoin (BTC) showed resilience, gaining 1% to over $119,000, after retreating from last Monday's record high of $123,000. The market pause follows the signing of the GENIUS Act, America’s first major crypto legislation, which establishes a regulatory framework for stablecoins.
Shawn Young, Chief Analyst at MEXC, described the pullback as a "hangover" after a week of euphoria, with altcoin open interest approaching Bitcoin’s—a dynamic historically linked to corrections when positioning becomes too aggressive.
Fed Uncertainty Adds Market Pressure
The correction coincides with rising attention on Federal Reserve Chair Jerome Powell, who is set to deliver his final public address before the Fed's 10-day blackout period. Markets are pricing in just two rate cuts this year, and Powell’s tone could significantly impact risk sentiment across crypto and traditional assets.
"With the news cycle slowing down and Powell in the public eye, risk management isn't a choice—it's the strategy," Young emphasized.
President Trump reportedly drafted a resignation letter for Powell last week, with speculation he may name a "shadow" successor to push for faster rate cuts, which typically boost risk assets like Bitcoin.
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