Some altcoins, including Cardano and Litecoin, have experienced high volatility, raising concerns among investors and analysts.
Altcoin Drop after Open Interest Spike
According to Joao Wedson, CEO of cryptocurrency analysis company Alphractal, some altcoins in the market experienced a decline after their open interest rates suddenly jumped. Specifically, altcoins like Cardano (ADA), Litecoin (LTC), Sui (SUI), and TRUMP had the highest Liquidation/Open Interest ratio in the last 24 hours, indicating significant liquidations.
Understanding 'Dead Cat Bounce'
The analyst stated that this situation amounts to a 'dead cat bounce' for these altcoins. A dead cat bounce is an unexpected price jump that occurs after a long and slow decline and usually just before another price drop.
Resilience of Different Altcoin Categories
Alphractal, assessing the rest of the cryptocurrency market, stated that some categories of altcoins are more resilient than others. They noted sharp declines in memecoins and AI projects in recent days, while layer-1 and payment categories have shown resistance.
While certain altcoins faced increased volatility, differences in resilience among categories suggest continued shifts in the market landscape.
