Currently, the market is relatively tense. When can we expect the altcoin market to emerge? Today, we will analyze the market capitalization share and ETH market capitalization trends, along with candlestick charts, to provide a clearer understanding of the market through graphical data!
① From the cyclical perspective of bull markets, past bull markets typically last about 3-4 years from the bottom of the bear market to the end of a new bull market. The last bear market bottomed out and this bull market started around the end of 2022 to the beginning of 2023. Therefore, it can be inferred that this year is essentially the last year of this bull market.
② Historical Trend Analysis: In the previous bull markets, there were differences, but the basic cyclical trend is that Bitcoin (BTC) starts by breaking through historical highs, and then Ethereum (ETH) gradually leads altcoins into a major uptrend. Due to the involvement of the U.S. government and institutions in this bull market, larger capital prefers Bitcoin, causing the entire market to be drained, making altcoins harder to maneuver than in previous bull markets. However, the market we expect will still come because capital speculation also focuses on the risk-reward ratio.
In the last round, if we calculate Bitcoin from a bottom of around 3,500 to a peak of 69,000, it is nearly a 20-fold increase. Actually, from the initial rise to 60,000 and then a pullback to 30,000, Bitcoin had already peaked, leading to a prolonged period of distribution that lasted over six months. During this period, various altcoins performed a final pump to cover Bitcoin's offloading.
As the price of BTC continues to rise, its market capitalization also increases. The rate of increase in each round is actually shrinking. If we estimate this round from a bottom of around 15,000, a tenfold increase would bring it to around 150,000. Currently, the peak price is approaching 110,000, and the risk-reward ratio above is no longer that favorable. Additionally, this round differs from the previous one; historically, altcoins would indirectly follow Bitcoin, but this round has significantly lagged, as it has not yet broken the previous high. This means a favorable risk-reward ratio with huge potential, which explains why many institutions have been increasing their positions in Ethereum recently. Furthermore, many institutions are likely exchanging Bitcoin for Ethereum.
③ Analysis from the price trend chart and market capitalization share chart 📊:
As shown in the chart, the market capitalization share of Bitcoin has drawn a trend resistance line since 2013; it has currently hit near this resistance line, resulting in a short-term downward spike, and the small cycle's upward trend line has been broken. The second rebound has not shown divergence, and the indicators at the bottom are in a breakdown state, although the overall trend may be relatively slow.
Comparative Chart ② $ETH Market Capitalization Share Trend Chart: Here, Ethereum's large cycle has formed a flag pattern channel since 2021, and the current price is just at the support area of the channel's bottom after a significant decline. The downward movement of the fourth wave within the channel has completed, and the MACD at the bottom is in a recent golden cross state, indicating a short-term bottoming process, with a high probability of starting a fifth wave rebound soon.
From the technical chart 📊, as shown in Chart ③, after Bitcoin broke its historical high, it surged from 65,000 to 110,000, showing a breakthrough. Comparing Ethereum's trend chart, it is currently showing a movement similar to Bitcoin's oscillation near 65,000. Here, it is consolidating and accumulating, forming a large cyclical triangle convergence pattern. After such a long period of consolidation and accumulation, the indicators suggest that the adjustment phase is completed and is now in the right-side phase. Currently, many altcoins remain at the bear market bottom prices and accumulation zones; the reason for not moving up is that they are waiting for Ethereum to break through and gain strength so that the altcoin operators can begin their actions.
In summary, it can be inferred that the subsequent market will definitely focus on Ethereum, and it is highly likely to be the year of the anticipated bull market. As Ethereum's exchange rate rebounds from the bottom and Bitcoin's market share declines, Ethereum's increase will surpass Bitcoin, leading altcoins to show the expected market movements, completing the late-stage sprint of the bull market while covering Bitcoin for offloading! Cherish the current chips and hold patiently for the favorable winds to come.
