Although cryptocurrency market participants often seek different assets, there is generally a “altcoin season” expectation is at the forefront. Popular analysts Auistin Arnold and Ben Cowen say this season is not yet ripe to come. The duo, who recently released a video, advised to stay away from such investments for now. Here are the details of the remarkable analysis.
Bitcoin Domination Should Be Considered!
Bitcoin dominance (BTC.D) means that the total market capitalization of BTC is measured against all cryptocurrencies. If stablecoins are to be ignored in this chart, the rate is currently 52%.
According to analysts, as long as the rate remains high, the expected rally is unlikely to happen. The biggest reason for this is the constant devaluation of altcoin/BTC pairs. Analysts, who closely follow the “altcoin season index” data, think that this index should go down to around five.
Koinfinans.com As we reported, as the duo stated, the rise of Bitcoin’s dominance will not be eternal. They estimate it will likely reach around 65% this time, which is not much higher than its current level.
Altcoin Season Index
Altcoin season indextells investors whether the market is in Bitcoin season or altcoin season based on the previous 90 days. Austin explains that every one-and-a-half, two-and-a-half years, the metric should reach this deep value during the Bitcoin season, and the metric drops to around five.
In the last cycle, the indicator double bottomed where it entered the Bitcoin season a bit, but it only lasted a few months before everything bounced back again. Austin said this move is very similar to what we experienced in 2019, with a double bottom in the season index indicator.
Investors need to be cautious about investing at this point in the market cycle. According to Arnold and Cowen, altcoins may not be worth the risk again until this altcoin showdown is concluded after Bitcoin actually reclaims its required market cap percentage. They advise investors to delay buying altcoins until Bitcoin dominance reaches a much higher level.
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