Bitcoin’s market dominance has shown a 2% decline, an indicator that investor sentiment is moving towards alternative cryptocurrencies (altcoins). Despite this shift, market activity for altcoins has seen a noticeable slowdown as traders pause, waiting for the motivation to initiate the expected bull rally in the final quarter of the year.
Altcoin demand has increased over the past ten days, helping to push its market capitalization to $927 billion. This increase accompanies Bitcoin’s loss in market dominance. However, the momentum indicators for altcoins suggest a decrease in buying pressure, likely attributed to a broader market activity decrease. Traders are currently in a holding pattern, awaiting the spark to propel the ‘Uptober’ rally.
As demonstrated in the Moving Average Convergence/Divergence (MACD) indicator, buying activity is leading selling pressure in the altcoin market. However, the shrinking histogram bars suggest weakening bullish momentum. This trend is further supported by the Elder-Ray Index, which denotes a gradual loss of buying power despite the bulls dominating.
The Parabolic Stop and Reverse (SAR) indicator shows the possibility of an upcoming downtrend, hinting that the current uptrend might be losing steam. To signify the start of an altcoin season, at least 75% of the top 50 altcoins should outperform Bitcoin in a 3-month period. Currently, only 49 of these cryptocurrencies have managed to exceed Bitcoin’s performance in the past 90 days. Therefore, it’s safe to say the altcoin season hasn’t fully arrived yet.