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Key Takeaways
Altcoin Season Index hits 76, DOGE/BTC rallies, and BTC.D prints decrease lows. Will the index defy the 2024 cycle?
Past macro dangers, a significant headwind to Bitcoin dominance (BTC.D) has been the altcoin market. On paper, BTC is reclaiming back-to-back resistance ranges, the most recent round $112k.
And but, BTC.D hasn’t recovered 60% of inflows, printing a crimson weekly candle. In the meantime, TOTAL2 (market cap ex-BTC) is up 3.58%, displaying capital continues to be chasing high-beta alts.
The consequence? The Altcoin Season Index jumped 13% to 76 in a single day, formally signaling the primary full-blown altseason for the reason that election run.
This additionally underscores the persistent risk-off habits in BTC flows.
Supply: Blockchaincenter
Merely put, merchants are chasing outsized upside outdoors of Bitcoin.
Living proof: Dogecoin [DOGE]. Whereas Ethereum [ETH] is hitting a wall, with the ETH/BTC ratio failing at 0.04 resistance, DOGE/BTC ratio is ripping practically 10% in lower than two weeks, eyeing the 0.0000024 ceiling.
Curiously, the present market cycle mirrors the earlier election run, memecoin mania is surging, BTC.D is slipping, and ETH/BTC stays capped.
Given how the Altcoin Season Index broke out in 2024 throughout comparable circumstances, may we be witnessing a repeat efficiency?
Merchants, why warning is warranted!
In the course of the election cycle, BTC.D posted its worst weekly run in two years.
The Altcoin Season Index hit 88 by early December, dragging BTC.D down 10% to 54% in the identical stretch. Nevertheless, when BTC.D bounced again to 65% by mid-June, the Altcoin Season Index had crashed to 12.
Alts obtained wrecked as overstretched positions blew up. Quick-forward to now, Coinalyze exhibits Bitcoin Open Interest (OI) dominance at 38%, that means alt leverage is working 50% increased than BTC, organising a crowded playbook.
Supply: TradingView (BTC.D)
Briefly, the Altcoin Season Index is flirting with one other blow-off high.
However there’s a key divergence: BTC.D has posted two decrease lows since its 65% peak. In contrast to the election cycle, when capital rotated again into Bitcoin [BTC], alt inflows proceed to climb, holding BTC.D underneath stress.
Why does this matter? In line with AMBCrypto, traders are staying away from Bitcoin, holding it locked in a chop.
So long as this sample holds, the Altcoin Season Index stays in focus and will problem its 88 high.