Analysts are observing potential indicators that suggest an upcoming altcoin season, particularly through the analysis of both the altcoin market cap and Bitcoin ’s market cap dominance. Recent assessments point to two distinct patterns forming within these charts that may signal significant market shifts.
The first pattern pertains to the combined market cap of altcoins, which excludes Bitcoin and Ethereum . This sector has been developing a pennant formation, characterized by an initial strong upward trend followed by a period of consolidation. In this context, the initial upward movement between the last quarter of 2023 and the first quarter of 2024 forms the “pole,” while the subsequent downtrend creates the pennant. Recent retests of the upper resistance line indicate that a breakout could be on the horizon. If successful, this breakout could potentially push the altcoin market cap past the $1 trillion threshold, leading to considerable market excitement.
In contrast, the second pattern involves the market cap dominance of Bitcoin , measured by its percentage of the total cryptocurrency market. Currently, Bitcoin ’s market cap dominance is characterized by a rising wedge pattern. This formation, considered bearish, suggests that as Bitcoin ’s price narrows between converging trendlines, a breakout beneath the lower trendline could occur. Currently at 57%, a decrease towards the 47% level could provide a fertile ground for the altcoin market to flourish.
Meanwhile, Bitcoin itself has exhibited a period of consolidation, trading sideways around the $63,500 level as the market awaits further developments. The interplay between these patterns in the altcoin and Bitcoin markets could herald a shift that enthusiasts and investors alike are keenly anticipating.
