- The charts showed that it was still Bitcoin season.
- Economic factors will have a major effect on market sentiment and the chances of an altcoin season.
The Bitcoin [BTC] The dominance chart is about to dip lower, a crypto analyst noted in a message on X (formerly Twitter).
MACD’s bearish crossover with higher time frames could thrill crypto traders and altcoin investors.
Source: Mustache/X
The Bitcoin Dominance measures the BTC market capitalization as a percentage of the total crypto market capitalization. When the price drops, it means BTC is losing market share, which is an important development for an altcoin season.
How close are we to one, and what are the signs that altcoin season is upon us?
It’s still BTC season, evidence shows
Source: BTC.D on TradingView
The weekly Bitcoin dominance chart has shown a sustained upward trend since early 2023. This trend stopped between April and July this year, but continued to rise again.
The upward breakout strengthened the firm grip that BTC has on capital inflows into the crypto markets.
The 60% and 70% resistance bands, especially the latter, could lead to a rejection of BTC.D. This could herald an alt season.
The altcoin seasonal index settled at a reading of 22. Traders and investors must bide their time before the festivities can begin in earnest.
The macro market outlook boosted expectations for the altco season
The exchange stablecoins ratio measures the coin reserve divided by the exchange’s stablecoin reserve. A decline in this measure indicates a larger stablecoin reserve, which in turn highlights increased purchasing power.
The metric has been in a downward trend for the past six weeks, falling below its March 2024 low. Investors have good reason to expect crypto prices to rise as demand floods back in.
A macroeconomic viewpoint from Arthur Hayes, co-founder and former CEO of crypto exchange BitMEX, wondered when the altcoin season might start.
It examined the link between the RRP (Reverse Repo Program) and the flow of liquidity into financial assets such as gold or Bitcoin.
Read Bitcoin’s [BTC] Price forecast 2024-25
He added that dollar liquidity, BTC above $70,000 and Ethereum above $4,000 would be a prerequisite for an altcoin season.
Only time will tell if he is right, but in the past a major BTC rally was needed to add capital to the crypto market that then circulated through the various altcoin sectors.