- The altcoin season saw a notable increase in value during the latest bull run, spurred by Bitcoin testing the $66K mark.
- Nevertheless, a significant catalyst is necessary to initiate an altcoin season.
Bitcoin [BTC] is on the brink of a possible price correction after struggling to maintain its $66K position. AMBCrypto’s analysis indicates that $61K may act as the next support level, marking a critical low.
Traditionally, altcoin seasons tend to follow after Bitcoin reaches a bottom. If this pattern holds, the current downturn could signal the arrival of the next Altcoin Season.
The upcoming cycle may ignite altcoin season
At this moment, Bitcoin’s market dominance sits at 57.37%, a notable drop from its recent high of 58.59% just a week ago. This decrease in dominance could reflect a growing optimism towards altcoins.
The explanation is straightforward: two days prior, BTC hit the $66K resistance following a consistent upward trend, enabling several investors to realize profits. This exit could signify the next bottom.
Moreover, this pullback might entice renewed attention from investors, paving the way for potential altcoin appreciation.
Source: BlockChainCenter.Net
Currently, 17 of the top 50 cryptocurrencies are outperforming Bitcoin, leading to a 34% dominance in altcoins.
Numerous altcoins have displayed positive momentum throughout the recent rally, suggesting that another cycle may be required to catalyze the forthcoming altcoin season.
Therefore, monitoring Bitcoin’s upcoming cycle is vital for determining when these assets might experience a rally. In simpler terms…
Bitcoin consolidation could be the key
Although market excitement suggests a bullish start for Bitcoin in October, the daily price chart presents a contrasting perspective.
Should the mid-July rally repeat – where BTC bulls overcame resistance at $66K and ascended to $68K – Bitcoin’s dominance could be restored, potentially hindering the chances for an altcoin season.
However, a notable decline in the RSI points to a decrease in buying momentum. If Bitcoin enters a consolidation phase, it may provide room for major altcoins to shine.
Furthermore, increasing outflows of USDT indicate a rising withdrawal of stablecoins from exchanges.
Source: Glassnode
Historically, these withdrawals often coincide with Bitcoin losing significant resistance levels, prompting investors to seek safety in USDT.
Furthermore, these investors perceive altcoins as more appealing assets while awaiting a dip in Bitcoin.
Consequently, liquidity tends to flow towards altcoins, viewed as more affordable options, especially during periods of rising volatility.
In summary, should BTC consolidate near $64K or lower, investors may look to diversify their portfolios, which could lead to a significant rise in altcoins.
The season could be imminent
Beyond market sentiment, AMBCrypto has pinpointed a hidden trend in historical behavior.
Curiously, when Bitcoin dominance hit bottom six years ago, a rebound followed 761 days later, marking the commencement of an altcoin season.
Put differently, this trend implies that a similar timeframe could herald the next altcoin season shortly.
Source: X
In summary, if Bitcoin dominance continues its downward trend, it could eventually lead to a resurgence in altcoin prices if historical patterns repeat.
Read Bitcoin’s [BTC] Price Prediction 2024-25
As noted earlier, the current market climate indicates an ideal moment for altcoins to thrive, fueled by diminishing Bitcoin dominance, rising USDT outflows, and a supportive historical trend.
Ultimately, paying attention to these indicators is essential. If BTC enters a consolidation phase – which appears likely – we may witness the triggering of the next altcoin season.
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