I see this quite differently.
"My sense is that smart traders will use this latest turn to dump much of their remaining alt-coin bags on the market, while less-sophisticated investors will interpret this bounce as a "return to normal." We'll see how it plays out."
I take it that you are counting yourself as a smart investor. :)
We have seen a glut of investment in cryptocurrency over the past couple of months and recently we see that altcoins' value first react inversely to Bitcoin's rise with a following increase in values as optimism sets in and then again when Bitcoin decreases. Of course the less well-known coins are reacting differently with artificial bursts and declines everywhere and are not following the model I described above.
My view is that, as long as Bitcoin remains strong (irrelevant of its ups and downs) the well known altcoins will still fourish. Indeed, as Bitcoin is being replaced by other major coins as exchange currencies (Etherium, Monero and maybe a couple of others emerging) we may begin to see a much more balanced market.
Of course, nothing is predictable. Bitcoin has to take a dive sometime.
(I am not an expert. This is NOT investment advice.)
I agree that alt-coins will continue to rise and Bitcoin will lose market cap dominance over time. I just don't see a 20x run-up in coins like Ripple over a few short weeks to sustainable over the near-term, so a correction is inevitable.
As I think I once said in one of my other posts on Steemit, I disapprove of the word "correction" in reference to cryptocurrency markets. A correction, in my view, usually applies to things which actually have intrinsic value - for example, shares in a company have real value and if they are beings sold for more than the company is worth, then a correction is necessary. Potential values also plays a part, though, and as Ripple is (more of) a 'professional' cryptocurrency, I suppose "correction" is actually an apt word to use.
Correction merely refers to a decline in price -- at least that's how I'm using it here. Intrinsic value has nothing to do with it.