Analysts Point to 3 Key Metrics Signaling ‘Up-Only Season’ for Altcoins
Altcoin
altcoin season
bull market
An inverse head-and-shoulders (IH&S) chart pattern that has taken shape over the past 3 years.
Last updated:
October 12, 2024 12:00 EDT
Author
Ruholamin Haqshanas
Author
Ruholamin Haqshanas
About Author
Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto…
Author Profile
Share
Copied
Last updated:
October 12, 2024 12:00 EDT
Why Trust Cryptonews
With over a decade of crypto coverage, Cryptonews delivers authoritative insights you can rely on. Our veteran team of journalists and analysts combines in-depth market knowledge with hands-on testing of blockchain technologies. We maintain strict
editorial standards
, ensuring factual accuracy and impartial reporting on both established cryptocurrencies and emerging projects. Our longstanding presence in the industry and commitment to quality journalism make Cryptonews a trusted source in the dynamic world of digital assets.
Read more about Cryptonews
Cryptocurrency traders are pointing to a number of indicators that suggest a bullish trend for altcoins, potentially signaling the onset of an “up-only season.”
Several analysts have noted that key metrics and chart patterns are aligning to forecast a strong
period ahead for altcoins
, despite the market currently being dominated by Bitcoin.
One of the most notable observations comes from pseudonymous analyst Moustache, who highlighted the formation of a bullish pattern on the Altcoin Season Index in
a post on October 11
.
IH&S Pattern Has Been Preparing for 3 Years
The analyst pointed to an inverse head-and-shoulders (IH&S) chart pattern that has taken shape on the index, which tracks the performance of altcoins relative to Bitcoin.
This pattern, which has been developing over 3.5 years, is widely seen as a signal that the market may be preparing for a significant shift.
An inverse head-and-shoulders pattern is typically viewed as a bullish signal.
It indicates that a market’s downtrend is losing momentum, and buyers are starting to gain control.
For altcoins, this could mean that Bitcoin’s dominance is beginning to weaken, paving the way for smaller cryptocurrencies to outperform, a scenario often referred to as “altcoin season.”
Despite this, the Altcoin Season Index currently stands at 39, according to Blockchaincenter, which tracks the index.
This means that 39% of the top 50 cryptocurrencies by market capitalization have outperformed Bitcoin over the last 90 days.
However, for a full-fledged altcoin season to be declared, this figure needs to rise to 75%.
Adding to the optimism, another key metric that analysts are watching is the stochastic relative strength index (RSI).
This momentum oscillator has produced a bullish crossover on the three-week chart, a signal that independent analyst Titan of Crypto believes could precede a major rally for altcoins.
A bullish crossover occurs when the stochastic RSI crosses above its signal line, suggesting an upward trend is likely.
Titan of Crypto noted that historically, such crossovers have been followed by powerful upward moves in altcoins.
Top Cryptos See a Recovery
The ongoing recovery in altcoins is also reflected in the broader market capitalization of cryptocurrencies excluding Bitcoin and Ether, referred to as TOTAL3.
According to data from TradingView, the market cap for TOTAL3 has increased by 19% from a low of $516.7 billion in early September to a recent high of $617.8 billion in early October.
Although there has been a slight pullback, TOTAL3 remains above a key support zone.
Furthermore, traders booked profits as the RSI on the daily chart approached overbought levels, suggesting that altcoins were momentarily overvalued.
However, the RSI has since rebounded, indicating that market conditions still favor a continued uptrend for altcoins.
If TOTAL3 holds above the major resistance zone, analysts suggest that altcoins could continue their recovery, with the much-anticipated altseason potentially just around the corner.
Follow us on Google News
