Altseason. When and will it be?
At the moment the situation is that bitcoin is growing stronger than most altcoins with some exceptions. Well, most altcoins, after rising at the beginning of the year, have slowed down and corrected or are standing sideways, and many are wondering when the alt-season will start? And what is more profitable to continue to sit in alts or bitcoin?
What is even called the alt-season? It is accepted to consider the alt-season to be the period, when 75% of altcoins from TOP 50 show better performance than bitcoins during 90 days. But I want to know beforehand, that the alt-season starts and to prepare to it in any way, not just the fact that we are in the alt-season.
You can find a lot of sites on the internet with charts showing how close/far the market is from the alts season.
I also want to show you a few metrics that you can monitor on your own and make appropriate decisions.
1. Bitcoin BTC dominance graph .D shows market capitalization of the main cryptocurrency to the total market capitalization of bitcoin + altcoins. Theoretically, the lower the domination, the better for altcoins, because money flows into altcoins, but you should take into account that the number of altcoins grows and so does their capitalization. And also altcoins include stablcoins like USDT, BUSD, USDC and if the dominance is falling, it may be connected with the overflow of resources to stablcoins.
At the moment the dominance of BTC is growing and we are approaching the upper border of the sidewall, where we will have to see if the dominance will break the upper border or not. If the consolidation breaks up, bitcoin will again show better dynamics than most altcoins.
2. The dominance of USDT.D and USDC.D today are the most popular stablenecoins, a decrease in their dominance means a transfer of money to other assets such as crypto or withdrawal to traditional (fiat) assets. At the moment we see a downtrend in the USDT at 7%, and a consolidation, which if broken down could lead to a dominance around 6% or even lower.
2. The dominance of USDT.D and USDC.D today are the most popular stablenecoins, a decrease in their dominance means a transfer of money to other assets such as crypto or withdrawal to traditional (fiat) assets. At the moment we see a downtrend in the USDT at 7%, and a consolidation, which if broken down could lead to a dominance around 6% or even lower.
The USDC is also in a downtrend around 3% and the precipitous drop in dominance is due to the recent loss of the USDC/USD peg, and there is no halt in this trend yet.
Other stabelcoins have lower capitalization and their impact on the altcoin market is difficult to assess.
3. ETH/BTC trading pair
Unpopular pair, but essentially you can evaluate how much the ether infrastructure grows as when new ERC20 tokens are printed and when their price grows, ETH is bought and held.
We see a downtrend and the approach to the important zone 0.06 should be watched for its breakdown, as well as the downtrend, breakdown of which can start a local uptrend and respectively the growth of other tokens on ether.
4. Market sentiment.
All cryptocurrencies are considered by traditional investors to be risky assets, just like stocks, and altcoins even more so. Therefore, it should be understood that the growth of these instruments falls in the period when the market's appetite for risk increases. One can track the VIX - volatility index SP500 as a rule, a bullish cycle at the stock market occurs when the VIX index is below 20, but when the index is higher or rises, the investors expect higher volatility and prefer the protective assets. The last bull cycle in the stock market coincides with the alt-season, so this index can be used for your analysis.
And also to the powerful factors increasing the risk of investors, is the U.S. Federal Reserve policy, namely adds money to the U.S. economy or takes away by the Fed through QE / QT, as well as raising / lowering the base interest rate. With the latest developments in the U.S. banking industry, the Fed has increased its balance sheet by more than 300 billion, and many are talking that the last rate hike of 0.25% was the last one.
5. Google trends.
The level of retailer involvement in the market, also signals to us the beginning of the altseason, when new participants come to the market and buy up everything, for example I took the search queries altseason and cryptocurrency, but you can take any of them at your discretion and monitor the changes in the trend of queries.
trends.google.com/trends/explore?date=today 5-y&q=altcoin&hl=ru
trends.google.com/trends/explore?date=today 5-y&q=cryptocurrency&hl=ru
Conclusions
As seen, one indicator hasn't been invented yet and we have to monitor different information sources, at the same time getting something new, but it may give good results as early entrance points and general market mood. It is important to understand which way to trade, isn't it?
In my opinion, a full-fledged alt-season should be expected in the second half of 2023, starting in September.
Support for the author subscribe ✅ and start rocket 🚀.
Good luck and profit to all.
What is even called the alt-season? It is accepted to consider the alt-season to be the period, when 75% of altcoins from TOP 50 show better performance than bitcoins during 90 days. But I want to know beforehand, that the alt-season starts and to prepare to it in any way, not just the fact that we are in the alt-season.
You can find a lot of sites on the internet with charts showing how close/far the market is from the alts season.
I also want to show you a few metrics that you can monitor on your own and make appropriate decisions.
1. Bitcoin BTC dominance graph .D shows market capitalization of the main cryptocurrency to the total market capitalization of bitcoin + altcoins. Theoretically, the lower the domination, the better for altcoins, because money flows into altcoins, but you should take into account that the number of altcoins grows and so does their capitalization. And also altcoins include stablcoins like USDT, BUSD, USDC and if the dominance is falling, it may be connected with the overflow of resources to stablcoins.
At the moment the dominance of BTC is growing and we are approaching the upper border of the sidewall, where we will have to see if the dominance will break the upper border or not. If the consolidation breaks up, bitcoin will again show better dynamics than most altcoins.
2. The dominance of USDT.D and USDC.D today are the most popular stablenecoins, a decrease in their dominance means a transfer of money to other assets such as crypto or withdrawal to traditional (fiat) assets. At the moment we see a downtrend in the USDT at 7%, and a consolidation, which if broken down could lead to a dominance around 6% or even lower.
2. The dominance of USDT.D and USDC.D today are the most popular stablenecoins, a decrease in their dominance means a transfer of money to other assets such as crypto or withdrawal to traditional (fiat) assets. At the moment we see a downtrend in the USDT at 7%, and a consolidation, which if broken down could lead to a dominance around 6% or even lower.
The USDC is also in a downtrend around 3% and the precipitous drop in dominance is due to the recent loss of the USDC/USD peg, and there is no halt in this trend yet.
Other stabelcoins have lower capitalization and their impact on the altcoin market is difficult to assess.
3. ETH/BTC trading pair
Unpopular pair, but essentially you can evaluate how much the ether infrastructure grows as when new ERC20 tokens are printed and when their price grows, ETH is bought and held.
We see a downtrend and the approach to the important zone 0.06 should be watched for its breakdown, as well as the downtrend, breakdown of which can start a local uptrend and respectively the growth of other tokens on ether.
4. Market sentiment.
All cryptocurrencies are considered by traditional investors to be risky assets, just like stocks, and altcoins even more so. Therefore, it should be understood that the growth of these instruments falls in the period when the market's appetite for risk increases. One can track the VIX - volatility index SP500 as a rule, a bullish cycle at the stock market occurs when the VIX index is below 20, but when the index is higher or rises, the investors expect higher volatility and prefer the protective assets. The last bull cycle in the stock market coincides with the alt-season, so this index can be used for your analysis.
And also to the powerful factors increasing the risk of investors, is the U.S. Federal Reserve policy, namely adds money to the U.S. economy or takes away by the Fed through QE / QT, as well as raising / lowering the base interest rate. With the latest developments in the U.S. banking industry, the Fed has increased its balance sheet by more than 300 billion, and many are talking that the last rate hike of 0.25% was the last one.
5. Google trends.
The level of retailer involvement in the market, also signals to us the beginning of the altseason, when new participants come to the market and buy up everything, for example I took the search queries altseason and cryptocurrency, but you can take any of them at your discretion and monitor the changes in the trend of queries.
trends.google.com/trends/explore?date=today 5-y&q=altcoin&hl=ru
trends.google.com/trends/explore?date=today 5-y&q=cryptocurrency&hl=ru
Conclusions
As seen, one indicator hasn't been invented yet and we have to monitor different information sources, at the same time getting something new, but it may give good results as early entrance points and general market mood. It is important to understand which way to trade, isn't it?
In my opinion, a full-fledged alt-season should be expected in the second half of 2023, starting in September.
Support for the author subscribe ✅ and start rocket 🚀.
Good luck and profit to all.
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