Altcoins Find Support After 45% Decline — Signs of Mini Altcoin Season Emerging

Key Takeaways

• The Altcoin market cap trades in a descending wedge
• The short-term relative strength of altcoins is bullish.
• Will there be a semblance of an altcoin season in 2025?
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There has been no Altcoin Season in the current cycle, as evidenced by the consistent increase in the Bitcoin Dominance Rate (BTCD). The Altcoin Season Index shows that it is currently Bitcoin season. 

However, some charts are lining up for a significant relief in altcoins. While this will likely not trigger a full-blown altcoin season, it could offer much-needed relief.

Let’s investigate a few charts and see what will happen.

Altcoins Show Relative Strength

The OTHERS/BTC chart shows the relative strength of altcoins by charting them against Bitcoin.

The chart shows a 45% five-wave decline since December 2024. A symmetrical triangle in wave four confirms this is the correct count.

Between February and April, the OTHERS/BTC chart created a double bottom (green icons), known as a bullish pattern.

Combined with the wave count, a significant rally is likely.

However, technical indicators are undetermined.

On the one hand, the Moving Average Convergence/Divergence (MACD) has created a bullish divergence. Conversely, the Relative Strength Index (RSI) is below 30.

The indicators do not confirm the double bottom pattern. Despite the completed decline, it is unclear if a bounce will immediately occur or if another low awaits.

Will ALTCAP Break Out?

The Altcoin market cap has fallen inside a descending wedge pattern since its cycle high of $1.64 trillion in December 2024.

The downward movement led to a low of $832 billion on April 7, a nearly 50% decline since the cycle high.

Despite the considerable fall, a descending wedge contains the price movement. The descending wedge is a bullish pattern, meaning it usually leads to breakouts.

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Furthermore, the wedge contains a five-wave decrease (red). While this means the trend is bearish, it also suggests a significant price breakout will happen soon.

If one happens, the primary resistance levels will be at $1.15 and $1.25 trillion. The 0.382 and 0.5 Fibonacci retracement resistance levels create these targets.

While the price action and wave count are bullish, technical indicators do not confirm this breakout.

While the MACD has generated a bullish divergence (orange), the RSI is below 30 and trends downward.

So, it is unclear if the ALTCAP will immediately break out from the wedge or if another low is in store before an eventual breakout.

Will BTCD Fall?

The BTCD has increased significantly since its cycle low. After a brief decline in December 2024, BTCD resumed its ascent inside an ascending parallel channel.

BTCD trades in the middle of the channel (black circle), possibly suffering a rejection.

If that is the case, BTCD could break down from the channel, reaching the 0.5 Fibonacci retracement support at 59.30%.

Technical indicators show some weakness, which is visible in the bearish divergence in the MACD.

This possible BTCD decline aligns well with the short-term relief predicted in the previous two charts.

Is Altcoin Season Over?

After a significant fall since December, it is unlikely that a full-blown altcoin season will happen in 2025.

Nevertheless, various charts suggest that a relief rally will happen soon, though it is unclear if another short-term drop is likely.