Altcoins
Altcoin Market Has Entered Reaccumulation Phase, Traders Say
Altcoin Market Has Entered Reaccumulation Phase, Traders Say
Cryptocurrency traders are signaling that the altcoin market has entered a “reaccumulation phase,” suggesting a potential move toward the “second leg of the cycle” after reclaiming a crucial support area. Independent Crypto Trader Mags note As of July 25, altcoins are up just 58% since breaking out of a prolonged 525-day accumulation phase.
The accumulation phase is characterized by a market bottom, where prices reach local lows and stabilize. This phase is marked by a 33% drop in the TOTAL2 index, which tracks the total market capitalization of all cryptocurrencies except Bitcoin, since March 11. During this period, investors typically buy on dips, anticipating future price increases.
Mags shared a chart to illustrate that despite a recent correction, altcoins have surged 58% since breaking out of their accumulation phase. This suggests that there could be further upside potential. “This pullback is likely just a reaccumulation before a further upside,” Mags commented.
Data from Bitformance reveals that over the past three months, the top 200 cryptocurrencies equal weight index, which gives equal weight to all cryptocurrencies regardless of their market capitalization, has fallen by more than 55% compared to the market cap index, where cryptocurrencies are weighted according to their market capitalization. This decline indicates that smaller cryptocurrencies have underperformed compared to Bitcoin, implying that the altcoin season has not yet begun.
Bitcoin market dominance, which measures its market share relative to the broader cryptocurrency market, is approaching a multi-year high. Currently, Bitcoin dominance stands at 56.56%, up 3% over the past 90 days. This shift in market capital indicates that investors have been reallocating funds away from altcoins.