Last night, Ethereum and altcoins reversed the recent downturn, rising strongly against the trend, performing significantly better than the leading BTC. Does this indicate that the altcoin season led by Ethereum is about to begin? In yesterday morning's article, I mentioned the three necessary conditions for the start of the altcoin season:
BTC stabilizes and enters a sideways consolidation phase.
The ETH/BTC exchange rate no longer sets new lows and attempts to break through and stabilize at 0.037 (signal for the start of altcoin season) and 0.04 (bull market threshold).
BTC's market cap ratio peaks and retreats, consolidating in the 56%-60% range.
Next, we will analyze one by one whether these conditions have been met and when the altcoin season may truly arrive:
First point: BTC stabilizes and enters a sideways consolidation.
Considering the insufficient trading volume during the current Christmas holiday, there is a high possibility that BTC will maintain a range-bound fluctuation. Although selling pressure is still being released, the price fluctuates within a large range and has not broken key support. BTC's relative stability provides a foundation for attracting funds to altcoins.
Second point: Performance of the ETH/BTC exchange rate
In terms of the ETH/BTC exchange rate direction, the four-hour chart shows that after testing the bottom at 0.034 twice, it has stabilized and is currently attempting to break through the key resistance level of 0.037. This indicates that Ethereum's strength compared to BTC is beginning to show. If it can break through and stabilize at 0.037, it will mark the official start of the altcoin season.
Third point: BTC's market cap ratio peaks and retreats.
BTC's market cap ratio yesterday once climbed to 59.3%, then fell back and broke below the four-hour trend line support, currently exploring the downward 56% area. If the market cap ratio further retreats and stabilizes within the 56%-60% range, it will inject more momentum into the altcoin market.
Comprehensive analysis
From the perspective of time and space, the market is gradually meeting the three necessary conditions for the start of the altcoin season. Ethereum and altcoins have currently become the main focus for long positions. But at the same time, risks need to be heeded: the current selling pressure of BTC has not been fully released, and the price may still further decline (specific analysis can be referred to in the previous article).
Layout suggestions and opportunity points
If considering the layout of Ethereum and altcoins, pay attention to the following key points:
ETH price needs to stabilize in the 3380–3400 USD range.
ETH/BTC exchange rate needs to break through and stabilize at the key position of 0.036.
Summary
The preliminary conditions for the altcoin season are forming, but we still need to wait for BTC to stabilize further and ETH to confirm the breakthrough at key points. Before that, it is advisable to remain cautious, flexibly adjust positions, and closely monitor further developments in market signals.