Path to Altseason
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Hello traders, today we will talk about Path to Altseason
BASIC INFO
Altcoin season, or ‘Altseason’, is the home of face-melting gains & high volatility. It’s pretty much Christmas for crypto traders.
Within a brief period (usually a few weeks or months), the prices of altcoins (all coins besides Bitcoin) skyrocket as investors move their money out of Bitcoin and into other cryptocurrencies.
Once prices start to rise, FOMO investment kicks in, causing a snowball effect which drives altcoin prices even higher to astronomical (and often overvalued) heights for a short period of time.
Many investors can make the majority of their profits for the year during an Altseason if they are able to sell their altcoins before Alts
Bitcoins & Altseason
Put simply, Altseason begins when altcoins start to outperform Bitcoin (when prices of alts rise in comparison to Bitcoin), and Altseason ends when Bitcoin outperforms altcoins.
However, this does not mean that when Bitcoin’s price goes down alts automatically go up. In fact, historically, Bitcoin has tended to lift altcoins when it rises and also bring them down after a major crash, with the price of Bitcoin and altcoins often being closely correlated. Previous bull markets have generally seen Bitcoin enjoy an uptrend before altcoins join the wave and head for the moon.
Key Takeaways
An altcoin is simply any other cryptocurrency that is not Bitcoin. They are usually more volatile than Bitcoin, offering high-risk high-reward opportunities.
When Bitcoin dominance (the amount of the total crypto market share held in Bitcoin) declines rapidly, it leads to an increase of investments in Altcoins, which causes an Altseason.
Predicting Altseason is not an exact science, and it is not something that’s officially announced at a certain time or date.
An Altseason can occur several times a year and they often happen within a relatively short period of time.
For maximum gains it’s crucial to sell your altcoins before Altseason is over. Alt’s prices drop just as quickly as they rose.
There have been many Altseasons in the last decade, with all of them beginning right after Bitcoin dominance declined.
The sharper the decline in BTC dominance the bigger the Altseason.
How to take advantage of Altseason?
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
Top tips for navigating Altseason
Altseason is often the most lucrative time during a crypto market cycle, however, it is also the most volatile time. As the potential for gains rises so does your risk. Here are some tips to keep in mind during an Altseason:
Altseason is both an exciting and emotional time. If you’re a new investor, proceed with caution. Separating your investment decisions from your emotions is a tried-and-tested strategy for mitigating risk and maximising profits.
Having a solid exit strategy prepared will decrease the chances of you HODLing your alts through the peak only to see them fall when Altseason comes to an end.
Depending on your commitment level, spreading yourself too thin by investing in lots of altcoins can be confusing and difficult to keep track of. A bit of diversification is always good but don’t invest in more coins than you can keep track of!
Accept that you cannot be involved in every pumping altcoin. Choose your best picks and stay up to date on the relevant news and market movements.
Be sure to take profits on the way up to ensure that you realise most of your gains before prices come back down again. If you get a sizeable gain, you may want to reduce your position before the inevitable price correction!
Using your profits from Altseason to reinvest into Bitcoin while it is at a good price (and vice versa) is a popular strategy.
Risk management is the best way to make the most out of Altseason, given the sheer number of investment opportunities that will arise. Never risk so much that you won’t be able to keep playing – there can be multiple Altseasons in a year!
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
The Altcoin Season Index is a helpful (but not exact) tool to see where we are in relation to Altseason. According to the Altcoin Season Index, if 75% of the Top 50 altcoins performed better than Bitcoin over the last season (90 days), it is Altcoin Season.
They also give an indication of where we are in terms of an Altcoin Month or Year, with an easy to interpret graph that shows the general long-term trends of previous Altseasons.
Altcoin season is not something that’s officially announced at a certain time or date. Nobody knows for sure when it’s upon us, nor when it will end. All we have are certain indicators that can help us know if we have entered Altseason.
Why does Altseason see such huge gains?
FOMO and the snowball effect play a big part. Part of the reason Altseason sees such a dramatic rise in prices is because many new investors see prices beginning to rise, and immediately invest out of FOMO.
This creates a snowball effect which pushes prices higher and higher until they are overvalued and in a bubble. When people realise they are riding a precarious rollercoaster that may crash at any moment, they begin to sell. This causes panic which leads to more mass selling and the price plummeting back down to earth, bringing Altseason to an abrupt end.
When is the top of Altseason/the bull market?
The million-dollar question that no-one can really answer. While crypto markets follow cycles which can be predicted based on past market movements, every bull run is different and it is incredibly difficult predict the very top of Altseason, or any bull run for that matter.
Given the fact that no-one really knows exactly when the top of the bull run or Altseason will be, it is wise to take profits along the way as your portfolio gains value. Dollar-cost-average selling (DCA) can be useful to minimise the impact of the market’s volatility while you invest.
If Bitcoin’s price goes up will altcoins also go up?
Generally, yes. The price of most altcoins is highly correlated with the price of Bitcoin. It is Bitcoin dominance, however, that indicates when Altseason is beginning.
Why are altcoins dependent on Bitcoin?
A major reason that altcoin’s and Bitcoin’s prices are so highly correlated is that many altcoins are purchased with Bitcoin. Bitcoin is often bought before the purchase of an altcoin, pushing the price of both coins up.
Similarly, if someone wants to cash out on an altcoin, many exchanges require you to first sell that altcoin for Bitcoin, and then sell the Bitcoin for cash, which pushes both prices down at the same time.
Another reason the prices are highly correlated is simply because they’re in the same asset class and things that are in the same asset class tend to go up and down together.
What to look out for to predict an Altseason
The most important thing would be a decrease in Bitcoin dominance, usually occurring after an exponential increase and subsequent consolidation. Additionally, relative trade volume, social media activity, mainstream interest, new coin listings and the volume of news articles published from crypto projects seem to be good indicators of when Altseason might be approaching.
What is Ethereum’s relationship to Altseason?
Ethereum, seen as the second most trusted cryptocurrency and the silver to Bitcoin’s gold, is at the heart of the altcoin market. The start of bullish moves for Ethereum is often the start of Altseason, especially with so many alts and DeFi projects being built on top of the Ethereum Blockchain.
Generally, after Bitcoin rallies upwards and consolidates, Ether’s price will also need to break out before altcoins can see a sizable rally.
Can altcoins lift Bitcoin?
Not really. Bitcoin rarely gets boosted by altcoins.
Generally, once altcoins have pumped and claimed dominance from Bitcoin, the steps in to take back the bulk of the crypto market share, marking the end of Altseason.
What is an example of Bitcoin Dominance influencing Altseason?
On December 9, 2017, Bitcoin Dominance had gone from 69% to 37% in the space of just 35 days (which means it went from owning 69% of the total crypto market share to 37% in just over a month).
Looking at the Altcoin market cap chart, December 9 coincides exactly with the beginning of the largest Altseason that crypto had ever seen. The sharper the decline in Bitcoin Dominance, the bigger the spike in Alts.
History also repeated itself on March 30, 2018 when a sharp decline in Bitcoin Dominance from 50 to 38 in 40 days led to a significant increase in the Altcoins market cap.
What have previous Altseasons and bull runs taught us?
Previous bull runs and Altseasons suggest that larger-cap altcoins (starting with Ethereum) pump before smaller-cap altcoins begin moving up. This usually happens after Bitcoin has had a big move up, followed by some sideways movement, causing investors to seek gains in altcoins, thus decreasing Bitcoin dominance and starting the party that is Altseason.
IMPORTANT
BTC Rises - Altcoins Not Rising
BTC drops - Altcoins Super Drop
The scenario is confirming this - Be sure to survive before Altseason arrives
Never stop learning
I would also love to know your charts and views in the comment section.
Thank you
BASIC INFO
Altcoin season, or ‘Altseason’, is the home of face-melting gains & high volatility. It’s pretty much Christmas for crypto traders.
Within a brief period (usually a few weeks or months), the prices of altcoins (all coins besides Bitcoin) skyrocket as investors move their money out of Bitcoin and into other cryptocurrencies.
Once prices start to rise, FOMO investment kicks in, causing a snowball effect which drives altcoin prices even higher to astronomical (and often overvalued) heights for a short period of time.
Many investors can make the majority of their profits for the year during an Altseason if they are able to sell their altcoins before Alts
Bitcoins & Altseason
Put simply, Altseason begins when altcoins start to outperform Bitcoin (when prices of alts rise in comparison to Bitcoin), and Altseason ends when Bitcoin outperforms altcoins.
However, this does not mean that when Bitcoin’s price goes down alts automatically go up. In fact, historically, Bitcoin has tended to lift altcoins when it rises and also bring them down after a major crash, with the price of Bitcoin and altcoins often being closely correlated. Previous bull markets have generally seen Bitcoin enjoy an uptrend before altcoins join the wave and head for the moon.
Key Takeaways
An altcoin is simply any other cryptocurrency that is not Bitcoin. They are usually more volatile than Bitcoin, offering high-risk high-reward opportunities.
When Bitcoin dominance (the amount of the total crypto market share held in Bitcoin) declines rapidly, it leads to an increase of investments in Altcoins, which causes an Altseason.
Predicting Altseason is not an exact science, and it is not something that’s officially announced at a certain time or date.
An Altseason can occur several times a year and they often happen within a relatively short period of time.
For maximum gains it’s crucial to sell your altcoins before Altseason is over. Alt’s prices drop just as quickly as they rose.
There have been many Altseasons in the last decade, with all of them beginning right after Bitcoin dominance declined.
The sharper the decline in BTC dominance the bigger the Altseason.
How to take advantage of Altseason?
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
Top tips for navigating Altseason
Altseason is often the most lucrative time during a crypto market cycle, however, it is also the most volatile time. As the potential for gains rises so does your risk. Here are some tips to keep in mind during an Altseason:
Altseason is both an exciting and emotional time. If you’re a new investor, proceed with caution. Separating your investment decisions from your emotions is a tried-and-tested strategy for mitigating risk and maximising profits.
Having a solid exit strategy prepared will decrease the chances of you HODLing your alts through the peak only to see them fall when Altseason comes to an end.
Depending on your commitment level, spreading yourself too thin by investing in lots of altcoins can be confusing and difficult to keep track of. A bit of diversification is always good but don’t invest in more coins than you can keep track of!
Accept that you cannot be involved in every pumping altcoin. Choose your best picks and stay up to date on the relevant news and market movements.
Be sure to take profits on the way up to ensure that you realise most of your gains before prices come back down again. If you get a sizeable gain, you may want to reduce your position before the inevitable price correction!
Using your profits from Altseason to reinvest into Bitcoin while it is at a good price (and vice versa) is a popular strategy.
Risk management is the best way to make the most out of Altseason, given the sheer number of investment opportunities that will arise. Never risk so much that you won’t be able to keep playing – there can be multiple Altseasons in a year!
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
The Altcoin Season Index is a helpful (but not exact) tool to see where we are in relation to Altseason. According to the Altcoin Season Index, if 75% of the Top 50 altcoins performed better than Bitcoin over the last season (90 days), it is Altcoin Season.
They also give an indication of where we are in terms of an Altcoin Month or Year, with an easy to interpret graph that shows the general long-term trends of previous Altseasons.
Altcoin season is not something that’s officially announced at a certain time or date. Nobody knows for sure when it’s upon us, nor when it will end. All we have are certain indicators that can help us know if we have entered Altseason.
Why does Altseason see such huge gains?
FOMO and the snowball effect play a big part. Part of the reason Altseason sees such a dramatic rise in prices is because many new investors see prices beginning to rise, and immediately invest out of FOMO.
This creates a snowball effect which pushes prices higher and higher until they are overvalued and in a bubble. When people realise they are riding a precarious rollercoaster that may crash at any moment, they begin to sell. This causes panic which leads to more mass selling and the price plummeting back down to earth, bringing Altseason to an abrupt end.
When is the top of Altseason/the bull market?
The million-dollar question that no-one can really answer. While crypto markets follow cycles which can be predicted based on past market movements, every bull run is different and it is incredibly difficult predict the very top of Altseason, or any bull run for that matter.
Given the fact that no-one really knows exactly when the top of the bull run or Altseason will be, it is wise to take profits along the way as your portfolio gains value. Dollar-cost-average selling (DCA) can be useful to minimise the impact of the market’s volatility while you invest.
If Bitcoin’s price goes up will altcoins also go up?
Generally, yes. The price of most altcoins is highly correlated with the price of Bitcoin. It is Bitcoin dominance, however, that indicates when Altseason is beginning.
Why are altcoins dependent on Bitcoin?
A major reason that altcoin’s and Bitcoin’s prices are so highly correlated is that many altcoins are purchased with Bitcoin. Bitcoin is often bought before the purchase of an altcoin, pushing the price of both coins up.
Similarly, if someone wants to cash out on an altcoin, many exchanges require you to first sell that altcoin for Bitcoin, and then sell the Bitcoin for cash, which pushes both prices down at the same time.
Another reason the prices are highly correlated is simply because they’re in the same asset class and things that are in the same asset class tend to go up and down together.
What to look out for to predict an Altseason
The most important thing would be a decrease in Bitcoin dominance, usually occurring after an exponential increase and subsequent consolidation. Additionally, relative trade volume, social media activity, mainstream interest, new coin listings and the volume of news articles published from crypto projects seem to be good indicators of when Altseason might be approaching.
What is Ethereum’s relationship to Altseason?
Ethereum, seen as the second most trusted cryptocurrency and the silver to Bitcoin’s gold, is at the heart of the altcoin market. The start of bullish moves for Ethereum is often the start of Altseason, especially with so many alts and DeFi projects being built on top of the Ethereum Blockchain.
Generally, after Bitcoin rallies upwards and consolidates, Ether’s price will also need to break out before altcoins can see a sizable rally.
Can altcoins lift Bitcoin?
Not really. Bitcoin rarely gets boosted by altcoins.
Generally, once altcoins have pumped and claimed dominance from Bitcoin, the steps in to take back the bulk of the crypto market share, marking the end of Altseason.
What is an example of Bitcoin Dominance influencing Altseason?
On December 9, 2017, Bitcoin Dominance had gone from 69% to 37% in the space of just 35 days (which means it went from owning 69% of the total crypto market share to 37% in just over a month).
Looking at the Altcoin market cap chart, December 9 coincides exactly with the beginning of the largest Altseason that crypto had ever seen. The sharper the decline in Bitcoin Dominance, the bigger the spike in Alts.
History also repeated itself on March 30, 2018 when a sharp decline in Bitcoin Dominance from 50 to 38 in 40 days led to a significant increase in the Altcoins market cap.
What have previous Altseasons and bull runs taught us?
Previous bull runs and Altseasons suggest that larger-cap altcoins (starting with Ethereum) pump before smaller-cap altcoins begin moving up. This usually happens after Bitcoin has had a big move up, followed by some sideways movement, causing investors to seek gains in altcoins, thus decreasing Bitcoin dominance and starting the party that is Altseason.
IMPORTANT
BTC Rises - Altcoins Not Rising
BTC drops - Altcoins Super Drop
The scenario is confirming this - Be sure to survive before Altseason arrives
Never stop learning
I would also love to know your charts and views in the comment section.
Thank you
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