I’ m reading a lot of commentary of people calling for another altcoin season / investing in altcoin, so I wanted to make a little bit clearer what the altcoin season was. As altcoin season (AS in the graph) is refeered the period of time between december 2017 and januar 2018 in which the altcoin price increased regardless the price of bitcoin. Few BTC pair (IOTA/Monero) had big increase before this period (PAS). During this period of time the market cap of altcoin rapidly increased from 125 to 460 billions. At the beginning of the alt season (7 december) the price of bitcoin was around 14k dollars for a market cap of 240 billions. Bitcoin reached a maximum market cap of 334 billions the 17th of December. Very interesting actually bitcoin as well the altcoin market cap crashed against the level where the altcoin season was triggered. In other words, the threshold level for triggering the altcoin season is now a resistance. In a static view of the evolution of the market caps (without the time factor) a break above these levels should trigger the altcoin season again.
This is in my opinion unrealistic.
The altcoin season was the biggest pump and dump scheme of all time. As you can see with some exceptions most of the ALT/BTC pair are since there in a continuous bearish trend and with some imagination we can spot that we are slowly reaching a rounded bottom. Basically altcoins have been sold out for bitcoins. No hold, just sold sold sold. This means that every increase of the price in most of the altcoins will not be sustained as smart money did not had time to re-accumulate enough of these coins to push the price really high. So forget the moon in the alt/btc pair. It will not happens before 1 or 2 years or even more. Maybe a little hill in the next months, but not the moon. Probably the next altcoin season will regard only the amazon and the google of the cryptocurrency leaving the pet.com slowly going to zero.
Second bitcoin overcame this threshold with the strenght of a large parabolic movement. At same level we have now higher selling pressure than 2 years ago.
Third dominance consolidate between 52% and 58% during 260 days. After this the resistance of 58% was broken and bitcoin is actually overdominating.
So I see improbable that in a row the dominance break under 58 and 52% reaching the lowest dominance % of january 2018.
I agree that many Alts will disappear, which will drive down the alt capitalization. However this will make room for the others that have fundamental technical advantage.
If I look at the top two charts alone, I could even argue that we are approaching a new alt season. Couldn’t we argue that the previous ATH on the bottom chart was due to a lot of frivolous ICOs receiving a disproportionate amount of crypto capital?
I’m not suggesting that this is the beginning of a new alt season. I feel that we need more recovery from the top Alts. I’m just trying to understand from a broad perspective.
Nagat
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Hmmmm we shall see then
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If I look at the top two charts alone, I could even argue that we are approaching a new alt season. Couldn’t we argue that the previous ATH on the bottom chart was due to a lot of frivolous ICOs receiving a disproportionate amount of crypto capital?
I’m not suggesting that this is the beginning of a new alt season. I feel that we need more recovery from the top Alts. I’m just trying to understand from a broad perspective.