Signals of an Altcoin Season
The recent rise in altcoin prices isn’t solely driven by market cap charts or similarities to past bullish sentiment. Data from BlockchainCenter indicates that the altcoin season of 2022 might have already begun.
Their altcoin season index entered the altcoin dominance zone in early August. According to the platform, “Altcoin Season” is defined as a period when 75% of the top 50 coins outperform Bitcoin over a 90-day timeframe.
The index reached a value of 98 on August 10, a level not seen since April to June 2021. If the index remains above 75 for the coming weeks, a strong altcoin season could unfold in 2022.
When reviewing a 90-day analysis of the top 50 cryptos and comparing it to Bitcoin’s price performance, it’s evident that during this period, Bitcoin (BTC) struggled, while most altcoins experienced gains or smaller losses.
Top performers include CEL, ETC, UNI, and LINK, while larger projects like XRP, ADA, and ETH, despite declines, still outpaced Bitcoin.
Growing Short Positions
An increase in short positions among altcoins has been observed. Traders seem to be betting more on price declines than on gains. However, historical trends suggest such conditions often precede sharp price recoveries. It remains uncertain whether this will lead to a significant rally and a new altcoin season.
Ethereum’s Strength Over Bitcoin
Ethereum’s (ETH) performance against Bitcoin is another promising indicator of a potential altcoin boom in 2022. Analysis of ETH’s price in USD shows recent rapid growth, with its RSI potentially breaking through long-term resistance and targeting the $2,100 mark.
In ETH’s BTC pair, the weekly chart paints a bullish picture. Since bouncing off the 0.05 BTC level—previously a resistance zone—ETH/BTC has been on an upward trajectory, marking the start of the current bullish trend.
El crypto prof, a prominent Twitter crypto analyst, has mapped out a monthly ETH/BTC chart. He suggests Ethereum’s value relative to Bitcoin could surge based on fractal patterns from past bull cycles. His analysis points to potential gains of 379%, with ETH/BTC reaching 0.25 BTC in the coming months. If accurate, this could fuel a robust altcoin season in 2022.
