Altseason coming soon? Three key indicators to watch for a potential surge

Bitcoin (Bitcoin) the recent surge to the record level of $73,750, followed by a pullback to $61,000, has sparked discussions among cryptocurrency enthusiasts and experts on the potential start of an “Altseason”.

Traditionally, Bitcoin ignites market cycles with strong surges, but the real action often takes place during consolidation phases, when others cryptocurrencies typically take the initiative. This pattern is expected to be more pronounced due to several factors that are driving wider adoption and improving the valuation of altcoins.

The integration of decentralized finance (DeFi), advances in blockchain scalability and the growing use of smart contracts are key factors contributing to a potential altcoin rally, which could significantly alter cryptocurrency market dynamics.

Key market indicators to keep an eye on

Market analysts are closely monitoring a number of key factors indicators this could signal the start of an altcoin rally.

The first of these is the exponential moving average (20-day EMA) which emphasizes recent price changes and is crucial for timing potential rallies. A bullish the crossover in the EMA20 of the total cryptocurrency market capitalization suggests that a rally may be imminent.

Another key indicator is the Stochastic RSI, which evaluates the strength and weakness of the relative strength indicator (CSR) in a pre-established period. A bullish crossover in this parameter suggests that altcoins may be preparing for significant price movements.

If the total market capitalization of cryptocurrencies “retests” the EMA20 and at the same time “crosses up” on the Stochastic RSI, this could lead to a “rally time” second to the pseudonymous cryptocurrency trader Titan of Crypto.

Additionally, Bitcoin’s market share, measured by Bitcoin’s dominance, provides insight into overall investor sentiment and risk appetite.

Currently, Bitcoin’s dominance stands at 52.92%. A drop in this figure could signal a shift in investor interest towards altcoins, potentially marking the start of an altseason.

Added to this is the total market capitalization of altcoins, which excludes the top 10 cryptocurrencies, down 17.55% over the last 30 days to $266.47 billion, according to data from TradingView

Despite the decline, the market is still holding above the $250 billion support level, suggesting that it is positioning itself for a future upward move. highlighted trader Rekt Capital.

Expert forecasts and market sentiments

Expert opinions on the potential of an altseason are mixed, with some analysts predicting one to begin the largest altseason that could reach a market capitalization of $4 trillion.

However, other analysts, such as Benjamin Cowen, have done so noticed that current market conditions are not strongly indicative of an impending altseason, suggesting that Bitcoin could continue to dominate the markets for a longer period.

This sentiment is echoed by Blockchain Center’s Altcoin Season Index, which declares an altseason if 75% of the top 50 coins outperform Bitcoin in the past 90 days.

Seasonal Altcoin Index. Source: Blockchain Center.

The index shows that only 41% of the top 50 altcoins have outperformed Bitcoin over the past 90 days. As the index is below 75, this suggests that it is not officially altcoin season yet, providing a more cautious outlook amid enthusiastic predictions.

While there are promising signs of an impending altseason, the cryptocurrency market remains inherently unpredictable.

Investors should remain vigilant, staying informed about market trends and changes. It is crucial to thoroughly investigate and analyze altcoin projects when building investment positions to maximize potential gains while effectively managing risks.

Disclaimer: The content of this site should not be considered investment advice. Investing is speculative. When you invest, your capital is at risk.

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