Altcoin Season or Not? How to Read the Altseason Index

Altseason is a buzzword in the crypto community, but what does it really mean and more importantly, are we in one right now? With the recent U.S. election behind us, the crypto market is buzzing, and Bitcoin has hit a record high above $75,000. As Bitcoin leads the charge, investors are wondering: is altseason starting soon, or will Bitcoin continue to dominate?

The altseason index is a straightforward tool that can help answer this. It is a tool that gives us a clear snapshot of when altcoins are performing better than Bitcoin. It’s a simple yet powerful way to help investors tracking the shifting momentum in the crypto market.

In this guide, we’ll explain how the altseason index works and offer a few practical tips to stay ready for whatever the crypto market throws our way.

What is Altseason Index?

The altseason index is a simple tool that shows when altcoins (any cryptocurrency that isn’t Bitcoin) are gaining strength against Bitcoin. When the index is high, it’s known as “altseason,” meaning many altcoins are outperforming Bitcoin. Typically represented as a value between 0 and 100, higher values indicate a stronger altcoin market.

This shift can signal fresh opportunities beyond Bitcoin and helps investors see where the market’s attention is moving.

Source: CoinMarketCap

Is Altseason Happening Right Now? Or When Will It Start?

The altseason index currently sits at 32, indicating that we’re still in Bitcoin season territory. For reference, the index has ranged from a low of 13 to a high of 50 over the past year, showing how it’s fluctuated between Bitcoin dominance and a stronger altcoin presence.

Source: CoinMarketCap

At this level, a score of 32 means Bitcoin is still leading the market momentum, with altcoins not yet showing a collective surge against it. Investors tracking altseason may see this as a time to remain cautious against the best performing altcoins and stay focused on Bitcoin’s movements.

However, since the index has reached a midpoint of 50 earlier this year, it’s worth watching for any upticks that could signal a shift in favor of altcoins. In summary, while the current score suggests Bitcoin is in control, the altseason index shows that conditions can shift, especially with recent market events and expected crypto bull run.

Top-Performing Altcoins Right Now

Even though the altseason index indicates that we’re in a Bitcoin-dominated market, some altcoins are standing out with impressive performance. Here’s a quick look at some of the top altcoins that have been catching attention:

• SUI ($SUI): SUI has led the pack with a remarkable 167% increase in the last 90 days. Its focus on scalability and recent ecosystem expansions have helped it capture investor attention and drive significant gains.

• Fantom ($FTM): Known for its high-speed, scalable blockchain, Fantom has seen a 114% increase over the past three months. New project developments and partnerships have contributed to its strong performance.

• Pendle ($PENDLE): With its unique yield trading features, Pendle has grown by 93% in the last 90 days, appealing particularly to DeFi enthusiasts looking for innovative yield-generating options.

• Aave ($AAVE): As one of the most trusted platforms in the DeFi space, Aave’s 92% increase reflects its ongoing development and community support, keeping it a popular choice among DeFi investors.

• Dogecoin ($DOGE): The meme coin favorite has seen an 85% increase over the past three months, driven by its active community and the continued interest from retail investors, showing that $DOGE still has strong appeal.

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How is the Altseason Index Calculated?

The Altseason Index is calculated using a combination of factors, including altcoin market capitalization, altcoin dominance, altcoin trading volume, and altcoin price performance. These variables are weighted to derive the final index value. The formula and methodology may vary among different Altseason Index providers, so it’s important to consider their specific calculations.

Some Altseason Index models also incorporate social media sentiment analysis, on-chain data analytics, and technical indicators to provide a more nuanced view of the altcoin market. These additional layers of analysis can offer valuable insights into market trends and investor sentiment. Here is our guide for more detailed view on the market cycles.

Simple Altseason Indicators to Watch

If you’re wondering whether the market could be shifting towards an altseason, here are a few straightforward indicators that can provide early clues:

1. Bitcoin Dominance: This is the percentage of the total cryptocurrency market cap held by Bitcoin. When Bitcoin dominance drops, it often means investors are moving funds into altcoins, signaling a potential shift towards altseason. Keep an eye on this number; a significant decline could be an early indicator that altcoins are gaining traction.

2. Altcoin Market Volume: If trading volume in altcoins begins to outpace Bitcoin, it can indicate rising interest in the altcoin market. Higher altcoin volumes show that more investors are engaging with alternative cryptocurrencies, which can be a precursor to altseason. Watching for spikes in altcoin volume can give you a heads-up before any major moves.

3. Market Sentiment and Social Trends: Pay attention to the general sentiment in the crypto community, particularly on social media and in the news. An increase in mentions, excitement, or even “hype” around altcoins often correlates with a shift toward altseason. For example, when altcoins like $SUI, $FTM, or $DOGE start trending, it may indicate that the market is gearing up for a potential altcoin rally. 

Monitoring these indicators can give you a better sense of where the market is heading. While none of these factors alone guarantee an altseason, together, they can provide a clearer picture of market dynamics and help you anticipate shifts in momentum.

Quick Tips for Being a Winner in the Next Altseason

If you’re gearing up for the next altseason, here are some simple yet effective strategies to put you in the best position to ride the wave:

1. Focus on High-Quality Altcoins: Not all altcoins are created equal. Look for projects with strong fundamentals, active communities, and recent developments. Coins like $SUI, $FTM, and $AAVE have shown strong performance recently and could be solid picks when the market shifts in favor of altcoins.

2. Set Clear Profit Targets: Altseason can bring fast gains, but it can also be short-lived. Setting specific profit targets for each position helps you lock in gains and avoid the rollercoaster of holding too long. Decide on your exit points before the hype peaks, and stick to them. Explore more about short term crypto trading strategies here. 

3. Stay in the Loop: Timing is key in altseason. Regularly check the altseason index and keep an eye on social media trends, news, and volume spikes. Being aware of shifts in sentiment and volume can help you catch opportunities early and stay ahead of the crowd.

4. Keep Some Bitcoin on Hand: While altcoins may shine during altseason, Bitcoin remains the market leader. Sudden Bitcoin moves can influence the entire market, so holding some Bitcoin can help balance your portfolio and give you flexibility to pivot as trends shift.

5. Use Stop Losses Strategically: Altcoin rallies can be volatile. Setting stop-loss orders can protect your profits and limit potential losses if the market turns unexpectedly. This way, you’re prepared to secure gains and minimize risks.

By following these tips, you’ll be better prepared to make the most of the next altseason and position yourself as a winner. Remember, altseason rewards those who stay informed, think strategically, and manage risk effectively.

FAQ

What is the Altseason Index?

The Altseason Index measures the performance of altcoins relative to Bitcoin in the cryptocurrency market.

How is the Altseason Index calculated?

The Altseason Index is calculated using a combination of factors, including altcoin market capitalization, dominance, trading volume, and price performance.

What does a high Altseason Index mean?

A high Altseason Index indicates a strong altcoin market, suggesting that altcoins are outperforming Bitcoin. This could present investment opportunities for higher altcoin returns.

What should I do during bear markets?

During bear markets, where the Altseason Index tends to decline, it is advisable to exercise caution with altcoin investments and consider prioritizing safer options like Bitcoin.

How can I use the Altseason Index to manage risk?

By closely monitoring the Altseason Index, combined with other risk management strategies like stop-loss orders and diversification, you can effectively manage risk and optimize your overall portfolio performance.

Altseason presents unique opportunities for those prepared to make the most of market shifts. By staying tuned to the altseason index and focusing on high-potential altcoins, you’re setting yourself up for smarter moves when the market changes.

Ready to take action? With Morpher’s zero-fee trading, you can trade altcoins confidently without the extra costs. Morpher simplifies the process, giving you the tools you need for the best trading experience. Start trading on Morpher today.

Disclaimer: All investments involve risk, and the past performance of a security, industry, sector, market, financial product, trading strategy, or individual’s trading does not guarantee future results or returns. Investors are fully responsible for any investment decisions they make. Such decisions should be based solely on an evaluation of their financial circumstances, investment objectives, risk tolerance, and liquidity needs. This post does not constitute investment advice.