Altcoins will lower before the beginning of the bull run in early summer – analyst

Bitcoin aside, the cryptocurrency market may find a local bottom in June, marking the beginning of the next altcoin bull cycle, according to market analysts.

Altcoin bottom may happen in June – analyst

Based on historical chart patterns, altcoins may be set to find their local value around early June, noted crypto analyst Rect Capital wrote in a May 8 post.

“Altcoins are following the plan perfectly. Altcoins crashed in early February. Altcoins sold off around BTC Halving. Altcoins all the way down in early summer.”

The altcoin market has taken a beating in the past month. The market cap of altcoins, excluding the 10 largest cryptocurrencies, fell more than 21 percent last month to $265 billion.

Despite the monthly decline, the altcoin market value is still up 24% year-to-date (YTD) and up 167% over the past year.

Altcoin sentiment has historically been correlated with the price of Bitcoin (BTC). According to Alex Onufriychuk, a blockchain consultant and trainer at Qubic Labs Accelerator, Altcoins may find their local bottom around June as market sentiment and Bitcoin prices reduce flows from the United States and reduce Bitcoin exchange-traded funds (ETFs). He told Cointelegraph.

Lack of sufficient new liquidity from Bitcoin ETFs in the US and Hong Kong is likely to hit their local bottoms in June. This indicates that the consolidation period may be extended.

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Bitcoin crash ignites altcoin bull cycle – Nansen

Despite a potential local bottom, the altcoin bull run will need Bitcoin's price to reach the top first, Aurelie Barterre, chief research analyst at Nansen, told Cointelegraph.

“Altcoins are high-beta cryptocurrencies, they succeed when the sentiment is very bullish. The sentiment among crypto investors has been less positive since mid-March. As the price of BTC consolidates around the 20-day exponential moving average, there is more volatility in alts. More rest And we need a clear restart of BTC growth for alts to outperform.

BTC price has been posting lower highs since mid-March. However, many analysts argue that this is a healthy consolidation period after the halving. Additionally, the charts suggest a multi-month bull flag at a new all-time high in 2024.

Because altcoin sentiment is strongly correlated with bitcoin price, finding a local bottom doesn't necessarily translate into an altcoin rally, writes Cubic Labs' Onufriychuk.

“Even if altcoins hit their local bottom in June, it doesn't necessarily mean the start of a bull run. For a major turnaround, more fundamental changes are needed, such as increased retail and institutional investment and favorable regulatory developments.”

On the monthly chart, 10 of the 12 moving averages (MA) are flashing buy signals for top altcoins, such as Ether (ETH). Moving average indicators are commonly used in technical analysis to determine the average price of an asset over a period of time.

Altcoin prices may rise due to M2 money supply being positive year-over-year for the first time since November 2023, indicating that investors will soon start looking for hedges against inflation or alternative investments.

The M2 money supply estimates all cash and short-term bank deposits in the United States.

As the money supply in the world's largest economy increases, part of the new supply may flow into altcoins and memecoins, contributing to the beginning of “altszn”.

RELATED: Analysts Say Bitcoin Distribution Has Ended ‘Danger Zone'

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