- Analysts suggest that altcoin season is near as Bitcoin’s dominance shows signs of weakness.
- Recent asset price performances have further fueled altcoin season speculation.
- The recent shift follows risk-on macroeconomic tailwinds.
Over the past year, the crypto market has experienced a significant resurgence; however, it has yet to feel like a true bull market cycle for most altcoins, including Ethereum, have remained significantly underwater, far below previous highs. Amid recent perceived weakness in Bitcoin‘s market cap dominance, however, analysts are now suggesting that it might finally be time for these altcoins to rip.
Is altcoin season upon us?
Bitcoin Dominance Faces Rejection
Last week, Bitcoin’s market cap dominance reached the 58% mark, its highest point in three years. However, the metric has since been rejected to around the 57.6% level at the time of writing. Prominent crypto analyst Ali Martinez has suggested that this rejection might be a sign that Bitcoin’s dominance is topping out.
The analyst expressed this view in an X post on Sunday, September 22, with a chart highlighting that the 58% level had served as multi-year support between 2019 and 2021, which could now be turning resistance. At the same time, the metric has formed a rising wedge pattern on the weekly candle chart, which is a bearish pattern further indicative of a significant decrease in the metric. According to the analyst, all of these suggest that altcoin season may be upon us.
“Bitcoin dominance seems to be topping out, hinting at a possible dip to 47% — setting the stage for an altcoin season!” Martinez enthused, summing up his reading of the chart.
Asset price performances over the past week have bolstered recent altcoin season speculation.
Ethereum Outperforms Bitcoin
After falling to 40 month-lows against Bitcoin, Ethereum is showing signs of a resurgence, shaking off recent doldrums to outperform Bitcoin. Over the past seven days, ETH has experienced a price surge of about 15%, while BTC has surged by only about 8%.
Citing ETH’s breakout against BTC on the daily candle chart, prominent crypto trader “LongTermR” argued that the altcoin season had already kicked off.
“BTC stalling, ETH and alts ripping. We haven’t got used to it this cycle, so we are a little bit confused. But shouldn’t altcoin season look like that? Alts outperforming BTC. Just check this nice breakout against BTC on the daily chart and we get an answer,” he wrote.
Other altcoins outperforming BTC in the past week include NEAR, FET, SUI, APT, and TAO, all up 25%, 28%, 41%, 36%, and 82%, respectively.
The recent talk of altcoin season, which is a shift in focus from the relatively stable Bitcoin to more highly volatile crypto assets, follows risk-on macroeconomic tailwinds sparked by the Federal Reserve’s dovish turn last week. The Fed cut rates by 50 basis points for the first time in four years, with plans to carry out another cut before the year ends.
On the Flipside
- Amid Bitcoin’s continued dominance in the past year, analysts like Ikigai CIO Travis Kling have argued that most altcoins had failed to achieve product-market fit and were effectively dead.
- Not all altcoins have joined the party, as assets like XRP, TON, and TRX have posted only between 2% to 3% gains in the past seven days.
Why This Matters
Increased altcoin interest is often indicative of greater risk-on investor sentiment, which is positive for overall crypto market growth.
See how to prepare for the potential altcoin season:
Altcoin Season: Tips and Tactics for Market Research
The Ethereum Foundation’s selling spree continues. Find out more:
Ethereum Foundation Continues Sell-Off as ETH Surges Past $2,500
