On December 4, the altcoin season index reached 88, suggesting that cryptocurrencies outside of Bitcoin may perform better than the leading cryptocurrency. However, the opportunity for the altcoin season has suffered a significant shock.
Nevertheless, it seems that the long-awaited altcoin season still has the potential to return. Here are three signs that many cryptocurrencies in the top 50 may soon experience significant growth.
Altcoins continue to be suppressed
The altcoin season is the period when altcoins experience superior growth compared to Bitcoin. The altcoin season index measures this trend, determining whether 75% of the top 50 cryptocurrencies are outperforming Bitcoin.
Typically, an index value above 75 indicates that the altcoin season has begun, while a value at 25 reflects Bitcoin's dominance. However, currently, the index has decreased to 49, showing the retreat of altcoins as Bitcoin regains a stronger position in the market.
Despite this decline, the altcoin season does not seem to have ended. One indicator of this is Bitcoin's dominance ratio.
Altcoin season index | Source: Blockchaincenter
An increase in Bitcoin's dominance ratio often indicates a growing preference for Bitcoin over altcoins, especially during uncertain market periods. This trend suggests that investors view Bitcoin as a safer option, due to its relative stability and established position in the market.
As dominance increases, interest in smaller cryptocurrencies may decline, leading to a potential reduction in capital inflow into altcoins. A few weeks ago, Bitcoin's dominance ratio climbed to 62%, suggesting that altcoins may no longer hold a secondary role.
However, at present, this index has decreased to 58.82%, indicating that altcoins have regained some market share. If this decline continues, BTC prices may drop while altcoin prices could surge.
Bitcoin dominance ratio chart | Source: TradingView
Altcoin market capitalization may still recover
The market capitalization of TOTAL2, tracking the top 125 altcoins, has recently decreased to $1.35 trillion, indicating that assets outside of Bitcoin are weak. This decline often signals that the altcoin season may be delayed, as Bitcoin dominates the market.
However, hope remains as TOTAL2 breaks through a descending triangle, signaling a possible trend reversal. Although the altcoin season may be struggling at the moment, this breakout suggests that altcoins could regain momentum if trading volumes begin to increase.
TOTAL2 weekly chart | Source: TradingView
If this volume increases, the market capitalization of TOTAL2 could rise to $1.65 trillion, marking the resurgence of the altcoin season and potentially driving the values of these coins to higher levels.
https://tapchibitcoin.io/co-hoi-mua-altcoin-giam-nhung-3-chi-so-chi-ra-tiem-nang-hoi-sinh.html