I was thinking of trading between BTC, ETH and maybe a few others such as DOT and ADA but the fact that most traders trade between BTC / USDT or ETH / USDT etc suggests that it's probably a dumb idea that will cost me money. The fact that I need to ask this question probably suggests I shouldn't try it but it seems to me that they go up and down in spurts.
First of all there are thousands of altcoins in the market, and why you think about the third scenario which based on what’s happening, because you have been checking the top listed cryptocurrencies which most of them correlates with Bitcoin and ethereum and every move of them is likely to show on them as well.
There are so many other coins in the market that if you checked them you will see that they are falling when Bitcoin is going up, and these coins don’t correlate with Bitcoin, when Bitcoin is going up investors sell them to invest that money in Bitcoin. Even the coins that correlates with Bitcoin, this year they didn’t make much move as Bitcoin did.
Some experts are emphasizing about zero diversification in crypto space as bitcoin alone enough for all of us hence we do not need to risk by trading/investing into altcoins.