Throw in the dominance of Bitcoin and the structure of the altcoin market traders are predicting an altseason.
Altcoins have shown strength over the past month following Bitcoin's recent recovery. This has leading analysts suggesting that the market may be on the brink of an altcoin era.
“The past few days have been very busy for many #Altcoins!” Parabolic Pump, co-founder of Crypto Capital, said in a September 23 post on X.
Popular trader 360Trader TOTAL3 observed that the total crypto market capitalization, excluding BTC and ETH, retested the upper bound of the falling channel.
Although this critical level will push prices back from March 2024, a critical close above it will prove “nails in the bear's coffin,” he said.
Source: 360Trader
According to ParabolicPump, while altcoin prices have risen, Bitcoin's dominance has fallen behind the rising wedge crash. “It's a matter of time,” the analyst pointed out.
“Each bull run in the crypt has had a point where Bitcoin dominance has gone down significantly.”Bitcoin dominance 2-week chart. Source: Parabolic Pump
As of September 23, Bitcoin dominated 57.39%, down 1.09% last week, according to data from Cointelegraph Markets Pro and TradingView.
Traders often look for signs that Bitcoin's dominance has peaked, prompting investors to sell BTC and shift their capital into alternative coins.
According to popular analyst Nebraskangoner, Bitcoin's recent rise to 58.61% may mark the peak for this measure as the Relative Strength Index (RSI) shows that BTC's market structure is weak.
Altcoin market capitalization. Source: Beard
Meanwhile, anonymous analyst Moustance observed that TOTAL2, the total market cap of altcoins excluding BTC, is emerging from the downward expansion wedge it has been playing for the past six months.
Mustache's bullish outlook for altcoins is supported by the RSI breaking out of a downtrend and an impending bullish cross from the moving average divergence indicator.
“A god candle we haven't seen in years is being lit in my opinion.” Altcoin Market Capitalization. Source: Beard
In a follow-up post, the analysts' charts and onchain data show that the market is “set to witness its biggest bull run since 2017.”
Related: RSI Hints at Ancient BTC Price Divergence — 5 Things to Know in Bitcoin This Week
However, now is not the time to celebrate, as the Blockchain Center's altcoin season index indicates that altcoins are not here yet. According to this index:
“If 75% of the top 50 coins have outperformed Bitcoin over the past season (90 days), then this is Altcoin season.”
Despite the compelling technicalities, it may be too early to conclude that the altcoin era has begun. The chart below shows that only 39% of the top 50 altcoins have outperformed Bitcoin over the past 90 days. Since the index is less than 75, it indicates that this is not yet the altcoin season.
Altcoin period index. Source: Blockchain Center
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
