According to Cointelegraph, the altcoin market has been trending lower since the 2024 bull run hit a snag in March. However, several key indicators suggest that the recent recovery could signal a major move forward, crypto analysts have noted.
Technically, the altcoin market setup looks strong, holding above the uptrend line that has supported TOTAL2 — the cumulative market cap of all cryptocurrencies except Bitcoin (BTC) — since the 2017 bull run. Independent crypto analyst Mags highlighted in an Oct. 26 post on X that the altcoin market cap is currently testing the long-term trend line support that has held strong for the past eight years. A retest of the multi-year support line is a bullish indicator, suggesting that the downtrend is easing, and that increased buying at the current level could push altcoin prices higher. Mags added that with Bitcoin also breaking out, the market appears poised for a major move higher.
At press time, Bitcoin was facing resistance from its 2021 all-time high around $69,000. A decisive close above this level for Bitcoin and TOTAL2 holding above long-term trendline support could signal a major bullish move in the market. Analyst Moustach also pointed to the possibility of a breakout from a widening wedge, predicting that in the next 1-2 weeks, TOTAL2 could see an inevitable breakout from a 7.5-month falling widening wedge. Moustach noted that the recent 11% drop in TOTAL2 from $981 billion to $873 billion between Oct. 21 and Oct. 25 could be a deflection as the price attempts to reclaim trendline support.
Bitcoin dominance, a metric that measures Bitcoin’s market share relative to the overall cryptocurrency market, has been on an upward trend since the start of 2023, reaching a three-and-a-half-year high of 59.75 on October 25. At press time, Bitcoin dominance was at 59.56%, indicating that it is still “Bitcoin season.” Crypto Banter, a popular crypto YouTuber, suggests that the “parabolic” altcoin season phase occurs once Bitcoin dominance drops significantly. Crypto analyst Yoddha claimed that Bitcoin dominance could be “squeezing” into a rising wedge, indicating an imminent altcoin rally. Fellow analyst Crypto Rover echoed this sentiment, noting that Bitcoin dominance is on the verge of collapse, indicating that altcoin season is just around the corner.
Currently, Bitcoin’s level of dominance means that altcoins are still underperforming Bitcoin. Data from the Blockchain Center shows that only 29% of the top 50 altcoins have outperformed Bitcoin in the past three months, well below the 75% required for official “altcoin status.” With Bitcoin challenging new highs, market participants may be watching for a potential TOTAL2 market cap breakout, a decline in Bitcoin dominance, and a rise in the altcoin season index. If these factors align, they could signal the start of an altcoin season in the coming months.
This article does not contain investment advice or recommendations. Every investment or trading move involves risks, and readers should conduct their own research when making a decision.
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