The altcoin rally is cooling as Bitcoin trades sideways, with analysts citing short-term fatigue despite a supportive macro backdrop.
Several leading altcoins that rallied amidst Bitcoin’s recent consolidation have stalled, prompting signs of fatigue across the broader market.
But is the sector nearing a pullback, or are current moves just macro tremors ahead of another upward leg?
Bitcoin is trading in a narrow range between $117,000 and $120,000, entering a period of consolidation following a strong rally.
In its wake, major altcoins have surged, with Ethereum up 24%, Solana 20%, and XRP 12% since the July 15 low.
The pattern is familiar: as Bitcoin steadies, capital often rotates into top-tier tokens, driving short-term outperformance.
However, the “significant” rallies in the past few months mean top altcoins such as Ethereum, Solana, and XRP “may experience a correction in the short-term,” Julio Moreno, head of research at CryptoQuant, told .
CoinGlass data shows a spike in Ethereum sell orders within 10% of its current price, suggesting possible selling pressure. The firm notes this negative delta means the “market may face selling pressure.”
Ethereum has been leading the rally, but a recent rise in ask skew suggests a “possible local reversal,” Tristan Teo, founder of Elfa AI, a platform that tracks real-time social and on-chain behavior, told .
Ethereum is taking a “breather” after running “hard,” Ryan McMillin, chief investment officer at crypto fund manager Merkle Tree Capital, told .
McMillin cautioned that 500,000 ETH await unstaking and could spook Ethereum’s Exchange Traded Fund inflows.
While Bitcoin’s consolidation around $120,000 remains healthy, McMillin also highlighted the potential for leveraged long liquidations in the short term.
That aligns with Moreno’s correction outlook and the short-term exhaustion signs observed in Ethereum’s order book.
Solana, meanwhile, exhibits a similar sign of caution; its open interest—the total number of outstanding derivatives contracts, including futures and perpetuals, that traders have not yet settled—has hit a record high.
Yet, its price remains roughly 30% away from its peak. A spike of this magnitude often suggests high leverage, reinforcing McMillin’s expectation of short-term leveraged long liquidation.
Despite short-term signals indicating a potential pullback, the broader trend remains constructive.
McMillin cited the prospect of Federal Reserve rate cuts and Bitcoin’s correlation with global M2 money supply, then stated that “athe next move is likely up,” calling the recent dip in the altcoin market “noise.”
