So I have been asking this myself for the longest time and I have asked many people, but no one really had a good explanation to the following phenomenon:
When Bitcoin goes up in value -> alts go down
When Bitcoin goes down in value -> alts go down
When Bitcoin goes sideways -> alts go up
Why is it that when Bitcoin goes down alts go down too? They are traded against each other ??!
Basics : Trading x against y -> if x goes down in value it means you can buy MORE x with Y or in other words x goes down y goes up. But this does not apply here for some reason.
Hope you can help me out with this burning question!
So to answer this one you have to remove all logic, simply put, people view bitcoin as being the indicator for the whole of the crypto world. They do not view each coin individually as of yet and so the dollar value is almost irrelevant. That explains why the price of alts falls when bitcoin value falls. Basically any bad news for bitcoin is viewed as bad for the whole of cryptos.
When bitcoin goes up in value everyone rushes to get their money in to bitcoin and they sell their alts at a discount.
When bitcoin goes sideways people feel safe moving their money in to alts as they don't fear losing out on a pump and so alt prices go up.
Fair enough, but when BTC goes down where does all the money go that was in alts? It has to go somehwere? I agree we have to look at the satoshi price because not many alts have $ trading pairs but it doesnt explain why alts go down when BTC goes down