Bitcoin is currently in a decent yet mixed position, but it faces a critical barrier that it must surpass. This isn’t much different for altcoins. Cryptocurrency analyst Wolves of Crypto identifies a five-step pattern in the altcoin market.
First, the market bottoms out during the bear market. Next, it reaches the top against bear market resistance. Following this, it tests the bear market resistance again and consolidates. The fourth step involves breaking above the bear market resistance and flipping it. Finally, the market breaches the previous all-time high and enters an altcoin season.
During the recent correction, many altcoins suffered significant losses, with some never expected to recover. However, the analyst sees this as a massive flush-out, preparing the market for a potential altcoin season.
Are We Close To An Altcoin Season?
During altcoin season, Bitcoin dominance decreases as investors shift to altcoins seeking higher returns. This pattern occurred in the previous cycle, and the current cycle appears to be following a similar trajectory. If the market can break above step four, a parabolic bull market with an explosive altcoin season could ensue.
The recent deviation in the market structure caused concern, particularly the breakdown below the bull market support band and the ascending support line. However, the analyst believes the structural trend may still be intact. Historically, these support levels have held during previous cycles, but their recent breakdown indicates a potential change in market dynamics.4
Market Awaits Clearance
Despite the deviation, the altcoin market needs one more upward move to confirm the bullish trend. Ethereum, following a similar pattern, didn’t break below its low, showing even more bullish potential.
The analyst remains macro bullish on cryptocurrency. He suggests that getting above key indicators will provide maximum clearance, ensuring the market isn’t just experiencing a resistance-support flip.
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