When altcoin season? Assessing market signals and future prospects

• The charts showed that it was still a Bitcoin season.
• Economic factors will have a big effect on the market sentiment and the chances of an altcoin season.

The Bitcoin [BTC] Dominance chart is close to plummeting lower, a crypto analyst observed in a post on X (formerly Twitter).

The higher timeframe MACD bearish crossover could elate crypto traders and altcoin investors.

Source: Moustache/X

The Bitcoin Dominance measures the market cap of BTC as a percentage of the total crypto market cap. When it drops, it means BTC is losing market share, which is a key development for an altcoin season.

How close are we to one, and what are the signals the altcoin season is upon us?

It is still BTC season, evidence shows

Source: BTC.D on TradingView

The weekly chart of the Bitcoin dominance showed a persistent uptrend since early 2023. This trend halted this year between April and July but resumed moving higher.

The upward breakout reinforced the firm grip BTC has on the capital inflow to the crypto markets.

The bands of resistance at 60% and 70%, the latter in particular, could spark a BTC.D rejection. This can usher in an alt season.

Source: Blockchain Center

The altcoin season index agreed with a reading of 22. Traders and investors must bide their time before the festivities can begin in earnest.

The macro market outlook encouraged altcoin season expectations

Source: CryptoQuant

The exchange stablecoins ratio measures the coin reserve divided by the stablecoin reserve of the exchange. A drop in this metric denotes an increased stablecoin reserve, which in turn highlights increased buying power.

The metric has been in a downtrend over the past six weeks and fell below the March 2024 lows. Investors have good reason to expect crypto prices to trend upward as demand flows in again.

A macroeconomic viewpoint from Arthur Hayes, co-founder and former CEO of crypto exchange BitMEX, asked of when the altcoin season might begin.

It examined the link between the RRP (Reverse Repo Program) and liquidity flow into financial assets such as gold or Bitcoin.

Read Bitcoin’s [BTC] Price Prediction 2024-25

He added that dollar liquidity, BTC above $70k, and Ethereum above $4k would be a prerequisite for an altcoin season.

Only time will tell whether he is right, but in the past, a large BTC rally was required to add capital to the crypto market that then circulated through the different altcoin sectors.