The Altcoin Season Begins: Speculation Fuels Bitcoin’s Weakness

Analysts are focusing on altcoins as Bitcoin (BTC) faces a price decline, hoping it could be an alt-season. This level, which often follows Bitcoin halvings, is expected after the fourth Bitcoin halving in April.

The altcoin season is the season when altcoins outperform Bitcoin and Ethereum (ETH) and provide better investment returns.

Analysts say that it is the level of accumulation of Altcoin

Mags, a prominent crypto analyst, has suggested that altcoins are trading at 60 to 80 percent of their previous highs. Total2, which tracks the market cap of the top-125 cryptocurrencies excluding bitcoin, highlighted that it is holding above the uptrend.

If this support holds, Mags suggests it could mark the start of “the biggest altcoin season ever.” When Total2 stays above the trendline, it shows positive momentum and a bullish trend for altcoins.

Another analyst, Mustache, noted that altcoins have held a perfect Wyckoff stock pattern for years. Altcoins are now consolidating as the price action is narrowing in an expanding wedge pattern.

Beard highlights that the move is on higher timeframes, although the lower timeframes are currently indicating a weak market outlook.

Read more: 10 Best Altcoin Exchanges in 2024

The Wyckoff Accumulation Pattern is a technical chart formation used by analysts to identify buying opportunities after a long period of decline. At this stage, the price of the asset is concentrated in a range as buyers and sellers fight for control.

The pattern suggests that institutional investors (smart funds) will accumulate assets at lower prices, while selling pressure will weaken. This creates a price reversal base, indicating that the asset may soon move higher as demand increases and selling decreases.

The current bear market corrects the post-half deviation

Another analyst at X, CryptoEstigma, is the ongoing bear market correction following an unusual event after the fourth Bitcoin halving. Unlike previous cycles, altcoins rallied earlier than usual this time around. Historically, alt periods begin near the end of the half year, but the early rally bucked this trend and led to an ongoing market correction.

“Half the outcome has not yet happened and yet altcoins have multiplied their value by Xs,” CryptoEstigma explained.

Meanwhile, crypto markets are struggling with US economic events such as Federal Reserve decisions, geopolitical tensions and recession fears, which contribute to high volatility. While some analysts foresee an altcoin season, others, such as Duo Nine, warn against over-investment in altcoins, the rise of Bitcoin's dominance and negative Ethereum ETF flows.

Read more: 11 Cryptos to Add to Your Portfolio Ahead of the Altcoin Phase

Additionally, another group of analysts are in the gray area, adjusting their portfolios and positioning themselves for optimal returns, preparing for any eventuality. However, there is a side that even if it comes, it may not fail to be as strict as 2017 and 2020.

“Anyone can launch an altcoin now, which completely depletes the market. Venture capitalist Jeff Kirdeikis says that if the altseason happens again, the gains from 17 or 20 will be a fraction.