A prominent cryptocurrency analyst for predict The “altcoin bull market” is imminent. These predictions are rooted in observing notable patterns in altcoin market cap charts.
Accumulation pattern suggests entering a bull market
According to cryptocurrency analyst Mags on
For context, the Wyckoff accumulation pattern, named after Richard D. Wyckoff, a pioneering trader in the early 20th century, is used to identify market bottom phases when institutional investors accumulate assets before the start of a new upward trend.
The Wyckoff Accumulation pattern typically unfolds in five stages (A), designed to highlight how professional attention prepares assets to move into the significant markup stage.
Stage A signals a break in the previous downtrend, with initial demand indicating that the market is no longer making lows. Phase B is characterized by testing. Institutions absorb supply amid volatile price movements, including potential false breakouts.
Phase C provides a key test of the bottom through a “spring” or “shakeout,” allowing smart money to acquire assets at lower prices from retail holders. At this stage, the readiness of the market for development has been confirmed. In stage D, an upward trend begins as demand comes under control, evidenced by a pattern of higher highs and higher lows.
Finally, Stage E is the breakout stage, when the market begins a new uptrend, with prices rising significantly and rewarding the efforts of accumulating large profits.
According to Mags, altcoin market caps have entered the ‘E’ phase of this pattern, which is characterized by a transition from accumulation to a potential price surge.
that much #altcoin Market capitalization has deviated from the large-scale Wyckoff accumulation pattern.
Price is about to enter stage “E” where Alt moves vertically.
The altcoin bull market is coming 🔥 pic.twitter.com/m2XeSoqGIm
— Mags (@thescalpingpro) February 12, 2024
Bitcoin vs Altcoin Market Dominance
Additionally, the Altcoin Season Index, an indicator provided by the Blockchain Center, is currently at 49, suggesting that there is a slight preference for Bitcoin in the market. However, the stage is set for altcoins to surpass Bitcoin in the coming months.
Specifically, Blockchain Center assumes that an altcoin season is established when 75% of the top 50 altcoins outperform Bitcoin over a 90-day period.
Despite Bitcoin recently approaching $50,000, it has been unable to sustain a close above this level, suggesting an opportunity for altcoins to gain market attention. Although slightly behind Bitcoin, the overall market capitalization of altcoins suggests increasing competition that could reshape the market landscape.
However, recent market trends have shown Bitcoin’s notable performance compared to altcoins, with a surge of more than 15% in the past week, pushing the price past $50,000 yesterday. Meanwhile, Ethereum is up 13% in the past week but is still trading below $2,700.
BNB and XRP recorded gains of 6.4% and 4.1% respectively over the same period. However, Solana and Cardano have surpassed this figure, boasting gains of over 10% following the recent Bitcoin surge.
But the altcoin’s total market cap of just under $900 billion, compared to Bitcoin’s slightly higher value of $950 billion, highlights the brewing race for market power.
Featured image by Unsplash, chart by TradingView
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