This bull run has been tough for people who were mostly exposed to altcoins. Many expected an altseason, where everything pumps with crazy multiples on alts. But so far, we haven’t seen that yet. So… will it happen ? And if yes, when ? I’ll share my thoughts in this article.
The Altcoin Market
Let’s look at Total 2 (the market cap of all cryptocurrencies excluding Bitcoin). We can see that the drop from the top in December was pretty steep, reaching the same levels as in August 2024.
The 200 EMA has acted as strong support so far, but right now the 50 EMA is acting as resistance. We need to break above it to confirm a bullish reversal. A retracement could happen in the short term, as long as we don’t close a weekly candle below the last low at $891 billion of market cap (MC), the trend remains intact.
Now let’s take a look at the dominance of tokens excluding the top 10. We’re sitting on a key support zone, if it doesn’t hold, altcoins will likely continue to underperform the top 10 tokens.
On the bright side, there’s a bullish divergence on the RSI, though that alone doesn’t confirm a reversal. It’ll be interesting to see if the price can bounce back to the trendline, and whether it can break it.
Bitcoin dominance remains one of the most useful charts to determine if and when an altseason might happen.
Since the start of the 2023 bull run, Bitcoin’s dominance has kept rising, mainly due to the approval of Bitcoin ETFs, which have attracted the majority of capital, pushing BTC to new all-time highs above $100K. This left little room for altcoins to outperform.
However, we might be seeing signs of a shift. Bitcoin dominance is nearing a historical resistance level at around 70%, which also marked the start of the 2021 altseason (and the top of that cycle). On top of that, there’s a bearish divergence on the RSI, signaling weakening momentum.
Conclusion
I believe an altseason will happen during this cycle, most likely near the end, when hype and euphoria return. So far, the market has favored “safer” assets like Bitcoin, but if the Fed lowers interest rates and macro conditions improve, liquidity should flow back into riskier assets — altcoins included.
As always, thank you for reading !
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Disclaimer: This is not financial advice, you need to do your own research !
