The altcoin market has shown remarkable strength following Bitcoin’s recovery over the past month, leading analysts to predict that the market could be on the verge of an “altcoin season.”
“The past few days have been very bullish for many #Altcoins!”, ParabolicPump, co-founder of Crypto Capital, wrote in a post on X on September 23.
Popular trader 360Trader observed that TOTAL3, the total cryptocurrency market capitalization excluding BTC and ETH, has retested the upper boundary of a descending channel.
This target has been weighing on the price since March 2024. However, a decisive break above this level would confirm “the final nail in the coffin for the bears,” they said.
According to ParabolicPump, as altcoin prices surge, Bitcoin Dominance is on the verge of breaking out of a lopsided triangle pattern. “It’s just a matter of time,” the analyst noted, adding:
“Every bull cycle in crypto has a period where Bitcoin dominance drops significantly.”Bitcoin dominance 2-week chart. Source: ParabolicPump
As of September 23, Bitcoin's dominance rate was 57.39%, down 1.09% over the past week, according to data from We Markets Pro and TradingView.
Traders often look for signs that Bitcoin Dominance has peaked, as a signal for investors to sell BTC and move capital into altcoins.
According to popular analyst Nebraskangooner, the recent surge to 58.61% of Bitcoin dominance may have marked a top, as the weakening divergence of the relative strength index (RSI) hints at a weakening BTC market structure.
Meanwhile, anonymous analyst Moustance observed that TOTAL2, the total altcoin market capitalization excluding BTC, is moving towards breaking out of the diverging triangle pattern that has been forming for the past six months.
Mustache explained that the positive outlook for the altcoin is reinforced by the RSI breaking downtrend and the upcoming bullish crossover from the MACD indicator.
“A magic candle like we haven’t seen in years is about to explode, in my opinion.” Total altcoin market capitalization. Source: Mustache
In a follow-up post, the analysts said that charts and network data suggest the market is about to “see its biggest bull run since 2017.”
However, it's not time to celebrate just yet, as Blockchain Center's altcoin season index says it's not altseason yet. According to the index:
“If 75% of the top 50 coins outperform Bitcoin in the most recent season (90 days), then it is an altcoin season.”
While the technicals are compelling, it may still be too early to conclude that altcoin season has begun. The chart below shows that only 39% of the top 50 altcoins have outperformed Bitcoin over the past 90 days. With the index just below 75, this suggests that altcoin season is not yet underway.
