Altcoins
Top Coins Face Challenges as Bitcoin Season Emerges
The total market capitalization of altcoins, excluding Bitcoin and Ethereum, has faced significant resistance, contributing to recent declines. However, according to several analysts, despite the near-term challenges, macroeconomic trends suggest that if the market follows a regular structural pattern, altcoins could see their growth progress.
The Altseason Index and Bitcoin Dominance Trends are essential tools for understanding market movements. Sharp declines in Bitcoin dominance often indicate the start of a new season. However, the Altcoin Season Index recently reached 18, indicating that we are still in the accumulation zone.
Providing a little context, to know if we are in another season, we can look at how altcoins perform in relation to Bitcoin. The most common way to track this is to look at Bitcoin’s dominance; sharp drops in dominance signal a new season.
To make this more convenient, there is an indicator called the Altseason index, created by blockchaincenter.net. This index evaluates the price movement of the 50 largest coins by market capitalization. If 75% of these coins outperformed Bitcoin over a 90 day period, that means we are in another season. The Altcoin Season Index indicates that the altcoin season may have already reached a local peak, with the market returning to the Bitcoin season in the near term.
The same calculation is carried out for periods of one month and one year. The scale goes from zero to one hundred, where 100% means the top 50 coins perform better than Bitcoin. Currently, we find that we are not even getting close to a new season. Currently the level is at 18, which is a clear indication that we are not in another season yet. However, historical trends suggest it fell below 10 before a rise. In November 2023, the index reaches 4.
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