The Bitcoin price reversal from the $70,000 psychological level has renewed the selling momentum in the October market. Contrary to the historical trend of a bullish Q4, several altcoins are already hovering in the overbought zone, signaling that a broader market pullback could trigger a significant downturn. Thus, risk-averse traders may sell these assets in October to safeguard their capital.
Top 3 Altcoins to Sell Before a Market Pullback in October
October has brought significant volatility to the crypto market, and while some assets show promise for future growth, others appear overbought and could face potential pullbacks. Savvy traders can identify altcoins they should offload by analyzing key metrics like the MVRV (Market Value to Realized Value) ratio.
FTX (FTT)
The FTX token has traded sideways for over a year, with a slight downward trend in the daily chart. By press time, the FTT price had traded at $1.78 while maintaining a market cap of $584.1 million.
According to the Santiment data, the FTT’s 365-day MVRV ratio has surged to a positive region, currently settling around 32%. A high MVRV ratio often indicates the asset is overbought, and investors might begin to take profits.
FTT’s recent correction from $3.43 to $1.75 coincides with the MVRV ratio fall from 101% to 32%, accentuating the asset is still at risk of prolonged downfall.
365-day MVRV | Santiment
Litecoin (LTC)
Contrary to other altcoins, the Litecoin price has recovered from $49.8 to $70— a 42% increase— within three months. However, the LTC price witnessed a renewed selling pressure at the $76 level, triggering an 8% pullback to trade at $70.6 while maintaining a market cap of $5.3 Billion.
In addition, the 30-day MVRV ratio has spiked to 24.8%, indicating that short-term traders are profitable. These speculative traders are often quick to book their profit, which could trigger a surge in volatility and selling pressure.
30-day MVRV | Santiment
Aave (AAVE)
Amid the recent market correction, the AAVE price records a notable pullback from $165.8 to $141, registering a 14.8% loss. The bearish turnaround forms a fresh lower high, indicating a change in market sentiment from buying on dips to selling in rallies.
Furthermore, the 90-day MVRV has surged to 2.36%, indicating that investors who bought AAVE within the past three months are also profitable. This could increase selling pressure as these traders may opt to lock in profits, potentially contributing to a short-term price correction.
30-day MVRV
Conclusion:
While it may be tempting to buy top crypto in hopes of further gains, the MVRV ratios suggest that FTX, LTC, and AAVE are overbought and might be at risk of a correction.
The post Why You Should Sell These 3 Altcoins in October appeared first on CoinGape.
