Cryptocurrency traders are predicting a bullish trend for altcoins, indicating a potential “up-only season” ahead despite Bitcoin’s dominance in the market. Analysts have identified key metrics and chart patterns aligning to suggest a strong period for altcoins, with the Altcoin Season Index forming a bullish inverse head-and-shoulders pattern over the past 3.5 years. This pattern typically signals a market shift, indicating that altcoins may outperform Bitcoin as buyers gain control, leading to an “altcoin season.”
Currently, the Altcoin Season Index stands at 39, indicating that 39% of the top 50 cryptocurrencies have outperformed Bitcoin in the last 90 days. To declare a full-fledged altcoin season, this figure needs to rise to 75%. Additionally, the stochastic relative strength index (RSI) has shown a bullish crossover on the three-week chart, a signal that analysts believe could precede a major rally for altcoins. Historically, such crossovers have resulted in powerful upward moves for altcoins.
The recovery in altcoins is evident in the broader market capitalization of cryptocurrencies excluding Bitcoin and Ether, known as TOTAL3, which has seen a 19% increase from $516.7 billion in early September to $617.8 billion in early October. Despite a slight pullback, TOTAL3 remains above a key support zone, with traders booking profits as the RSI on the daily chart approached overbought levels, indicating altcoins were temporarily overvalued. However, the rebound of the RSI suggests that market conditions continue to support an uptrend for altcoins.
With TOTAL3 holding above a major resistance zone, analysts anticipate that altcoins could sustain their recovery, potentially leading to the much-awaited altseason. The positive momentum in altcoins is fueled by various indicators, including the bullish inverse head-and-shoulders pattern on the Altcoin Season Index, the stochastic RSI crossover, and the overall market capitalization growth of TOTAL3. As traders remain optimistic about the future performance of altcoins, many are preparing for a potential shift in the market towards altcoins outperforming Bitcoin in the upcoming “up-only season.”
