Key Takeaways
- The Bitcoin Dominance Rate (BTCD) reached new highs in February.
- The Altcoin Market Cap is struggling to hold on to above long-term support.
- Is an altcoin season still on track for 2025, or has the bear market started?
The ongoing crypto market cycle has had almost no altcoin season. While there have been brief periods when the Bitcoin Dominance Rate fell, the long-term trend has been bullish for nearly three years.
Additionally, the Altcoin Market Cap (ALTCAP) did not reach a new all-time high, failing to do so by 5%. Because of the sharp decline that has been going on for the past two months, some suggest the altcoin season will not arrive in 2025, skipping the current bullish cycle entirely.
Let’s look at some charts and see how likely that is.
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BTCD Reaches New Highs
The Bitcoin Dominance Rate has trended upward for the past 882 days. The increase has been very gradual, devoid of volatility in either direction. Last week, BTCD reached a high of 64.34% above the 0.618 Fibonacci retracement resistance level.
However, it could not sustain the increase, creating a long upper wick. Nevertheless, BTCD still trades slightly above the 0.618 Fibonacci retracement resistance level.
The BTCD increase also validated the resistance trend line of a long-term ascending parallel channel containing the entire upward movement.
While bearish divergences are developing in both the Relative Strength Index (RSI)and Moving Average Convergence/Divergence (MACD), it is worth mentioning that similar divergences have developed since the end of 2023 without leading to any sort of decline.
So, the BTCD trend is unclear. A deviation above the 0.618 Fibonacci resistance and a close below it will likely lead to a decline. However, there is insufficient data to predict whether this will happen.
Is Altcoin Season Over?
The Altcoin Market Cap (ALTCAP) has fallen considerably since its cycle high of $1.64 trillion in December 2024. This was below the all-time high price of $1.71 trillion. The downward movement was preceded by a bearish divergence in the RSI and MACD (green).
ALTCAP’s decline has been swift, amounting to a 40% drop in several weeks. There is some hope in the long lower wick (white icon) that caused the price to return to the $1.20 trillion horizontal area.
As long as ALTCAP trades above this level, it may revisit its range high of $1.65 trillion. However, a breakdown will confirm that the bull market is over.
Even with the Feb. 3 liquidation event, the decline still falls within the boundaries of a corrective movement since ALTCAP touched the support trend line of a long-term parallel channel. Moreover, the decline could be an A-B-C correction, where waves A:C have a 1:1.61 ratio, common in such structures.
The MACD (black circle) shows a potential bullish cross, which suggests this possibility. However, the RSI is still bearish.
The real test for ALTCAP comes when the price reaches the $1.30 trillion resistance area. This is a horizontal resistance and coincides with the middle of the channel.
A breakout above it will go a long way in suggesting that ALTCAP has finished its correction and will increase to new highs. On the other hand, a breakdown from the channel and $1.20 trillion support area will mean the opposite, likely creating new lows.
Altcoin Season on Hold
The mixed readings from the BTCD and ALTCAP make it unclear if altcoin season will begin in 2025. The BTCD faces a critical level at 61%, while ALTCAP does the same at $1.20 trillion.
A BTCD breakdown below its resistance and ALTCAP bounce and support can trigger the altcoin season. The altcoin season index is also neutral , offering no clues as to what will happen the rest of the year.
Disclaimer: The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
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