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Despite the ongoing selling pressure on altcoins, investors’ hopes for a potential altcoin season continue to remain high. Experts cite on-chain data and Bitcoin dominance hitting its peak.
This could pave the way for the next altcoin rally. Additionally, investors are eyeing macroeconomic catalysts, such as Fed rate cuts, for a sustained rally ahead.
Altcoin Season Chances Grow As Bitcoin Dominance Tops
Market analysts are pointing to a potential shift toward altcoins as Bitcoin dominance consolidates below a key trendline. That’s a pattern similar to the one that preceded major altcoin rallies in previous cycles.
In the 2021 cycle, a breakdown from this same resistance line triggered a broad altcoin season. Also, the chart analysts suggest that current conditions are aligning once again.
The Bitcoin dominance chart indicates that the price is coiling near its monthly support level. At the same time, the Relative Strength Index (RSI) has broken its long-term downtrend. This suggests an early sign of momentum building in favor of altcoins.
Crypto market experts like ‘Bitcoinsensus’ caution that such breakdowns do not happen instantly. Furthermore, Bitcoin dominance may still retest the trendline before confirming a reversal. However, the ALT/BTC chart currently appears to be on the cusp of a breakout.
Popular crypto market analyst Merlijn The Trader pointed to mounting technical signals that may indicate an upcoming altcoin rally. He noted that the broader market is showing early signs of rotation away from Bitcoin.
Altcoin pairs against Bitcoin have reached a major monthly support level. On the other hand, the Relative Strength Index (RSI) has broken its long-term downtrend.
Historically, this has always triggered a primary altcoin season. The analyst noted that the price structure is “coiling,” suggesting a potential breakout phase ahead.
Merlijn the Trader argue that Bitcoin dominance “won’t stay king forever,” emphasizing that previous altcoin cycles began under similar technical conditions. He believes these signals mark the early stages of what could evolve into the next major altcoin season.
Analyst Merlijn The Trader argues that Bitcoin dominance “won’t stay king forever.” He emphasized that previous altcoin cycles had begun under similar technical conditions. Thus, these signals mark the early stages of what could evolve into the following primary altcoin season.
Altcoin Season to Begin As Market Cap Eyes Breakout
Crypto analyst Merlijn The Trader says altcoins are forming a “multi-year cup and handle” pattern. This is a classic bullish setup that could trigger a strong breakout to the upside.
Merlijn describes the market structure as “textbook.” Recent retests have held firm, and bullish momentum is continuing to grow.
He described the current stage as “the prelude to vertical liftoff.” This suggests that altcoins may be on the verge of a significant breakout phase.
Furthermore, the analyst noted that this is “not the time to look away.” Thus, he hinted that a broader altcoin season could begin very soon.
Similarly, the on-chain analytics platform CryptoQuant stated that the current downturn in the crypto market is likely temporary.
They described it as a “relatively small correction phase.” According to the firm, market conditions suggest that a strong surge in altcoins may follow once the correction is over.
CryptoQuant noted that the rally may align with a phase of “intense overheating.” This is expected as the market nears the end of its current cycle.
All Eyes on FOMC Meeting
Today’s FOMC meeting could play a decisive role in determining the future direction of the crypto market from here onwards. Bitcoin and the broader cryptocurrency market have experienced some selling pressure. That’s a typical pre-FOMC behavior.
Crypto analyst Ali Martinez highlighted a recurring pattern between Bitcoin price movements and FOMC meetings. Martinez observed a strong pattern in Bitcoin’s behavior this year. Five out of six FOMC meetings led to corrections, with just one sparking a brief rally.
The observation suggests that traders may be reacting cautiously in anticipation of upcoming monetary policy updates. This can lead to short-term volatility in the Bitcoin price around key Fed decisions.
