The Brutal Truth About Altseason Returning Soon

Look at these 2 charts. One of them is up 117% in the last year. The other is up 182% in the last year. And they aren’t some small caps or memes. They are Monero and Stellar Lumens. Both are in the top 35 by market value. Typically, that’s what altseason feels like, seeing returns like these. But we are not seeing these returns across most alt markets, are we?

The truth is that we are in a bull market in some areas, but there is not and has not been a full altseason yet. Why not? And what are the signs? Today, we go over 3 signs of altseason’s impending arrival. Plus, we ask ourselves and you one of those difficult questions that can make the difference between a 5% ROI and a 5x. Ready to find the signs of altseason? Let’s check it out!

Sign #1: Falling Bitcoin Dominance

The first sign is Bitcoin dominance, known as BTC.D starts falling. Why? Well, BTC.D falls only in 2 cases:

1. Bitcoin price falls faster than the alt market.
2. Alt market prices rise faster than Bitcoin does.

And it’s #2 that interests us. If the value of alts is rising faster than Bitcoin is rising, then that’s a sign that investors and traders are rotating out of Bitcoin and into alts. That’s what we want to see and need to see.

It’s currently at a little over 60%. And that’s a little higher than we prefer for a confirmed altseason beginning. Somewhere in the mid-50s would be better. This tweet sums it up pretty well. No full-scale rotation has started yet. Just into some of the majors. So has this happened yet? Is Bitcoin dominance falling to an altseason level? No. Not yet.

Sign #2: Monetary Expansion

You are already hearing about this, including here on our channel, about December 1st. QT or Quantitative Tightening looks like it will end then. And that’s good for us. That’s where the US Federal Reserve tightens the liquidity by taking money OUT of the market. That’s the opposite of what we want. We want, and our market needs, quantitative easing. That’s when the central banks add liquidity. Because that liquidity has to buy assets and make money with that money.

Right now, for the next 4 weeks, we are still in the tightening stage. When we get more liquidity in the market, it will chase Bitcoin first, then high-quality alts. And maybe if there’s anything left, the smaller, very high-risk projects after. Regardless, more liquidity is what we need in the market. As we’ve explained here many times before, there are just too many tokens in the market. There’s not enough liquidity for all of them to rise.

It WON’T happen. And no, during tightening, there is even less liquidity than usual. Fewer dollars, Euros, and yen to chase these high-risk assets. It’s a big reason market returns have been so uneven and why a bull market doesn’t feel so bullish.

Sign #3: US Government Reopens

It’s a fact of life, even if we don’t want to admit it, that the Government is a big player in our day-to-day life. The US government, in particular, is involved in many more industries and markets than ever. And in a lot of cases, they are the biggest spender.

And right now, all of that is off with the government shutdown. We are nearly 40 days into it, and we are seeing cracks in many areas, including the airline industry and food aid to people. The airline industry is going to see some cuts at the 40 biggest airports soon if the shutdown continues.

Not to mention that a lot of macroeconomic data we get on inflation, manufacturing, jobs, and more are not being calculated. Those workers aren’t there. And the market needs this data. So I think we can’t get into a full altseason thanks to the government spending and gov’t economic data until the US Government reopens.

What If?

Let’s ask a question here. And it’s one that many of us don’t want to deal with, if we are being honest with ourselves. What if altseason is already here? Look at the charts of ETH, BNB, and LINK. Are they the entire market? No, of course not. But they are leaders. And they are all up between 20-40% in the last 12 months.

Or Hedera, which is up 230% in the last year. In other words, they are in a bull market already. That TrumpMelaniaElonShiba shitcoin you have? Not so much. They profited in memecoin season last November and December and have been losing money ever since. So what if we are in a bull market altseason already?

We all know there is not enough liquidity to increase the value of all alts like previous alt seasons. There are just too many coins now. It’s impossible. We’ve been saying all along that this is a picker’s market. You have to pick right, and you have to pick well. That includes:

• Hot narratives. Think AI and RWA, but not just those.
• Utility. Both the project and the coin actually do something. Paying for gas or governance doesn’t count.
• Leading or growing in importance in their specific sector. For example, I could make a few guesses as to what the leading RWA project is or will be in 6 months. Maybe it’s Ondo, maybe it’s something else. But don’t you want to hold the strongest projects in the sector? I sure do.

The days of nearly anything doing a potential 50x are gone. That’s if they were ever here in the first place. But pick right and you can easily 5x or 10x from here before the next cycle kicks in.

Disclaimer

The information provided by Altcoin Buzz is not financial advice. It is intended solely for educational, entertainment, and informational purposes. Any opinions or strategies shared are those of the writer/reviewers, and their risk tolerance may differ from yours. We are not liable for any losses you may incur from investments related to the information given. Bitcoin and other cryptocurrencies are high-risk assets; therefore, conduct thorough due diligence. Copyright Altcoin Buzz Pte Ltd.