The cryptocurrency market is currently in a state of recovery after experiencing a significant crash in early March. Despite the lingering fear and uncertainty reflected in the Fear & Greed Index, the price of Bitcoin is gradually climbing back towards $90,000. This upward momentum is starting to shift sentiment among altcoins, sparking hope for a potential altcoin season.
Renowned analyst Rekt Capital recently shared a key technical signal that has reignited optimism for the altcoin market. According to the analyst, a breakout in the altcoin market cap could be on the horizon if a crucial condition is met. The chart and commentary provided by Rekt Capital suggest that a major rally may already be underway, contingent on the altcoin market cap securing a weekly close above a specific level.
The altcoin market cap plummeted to a multi-month low in early March following the crash that wiped out significant price gains across various cryptocurrencies. While the market cap briefly dipped below $200 billion, it managed to close the week above this threshold. Over the past two weeks, the altcoin market cap has been steadily recovering and currently hovers around $249 billion. Rekt Capital’s technical analysis underscores the importance of a weekly close above the $250 billion mark, which could signal a significant shift for altcoins.
A decisive close above this level would likely pave the way for a breakout rally towards the $315 billion mark, indicating not only short-term bullishness but also confirming the establishment of a bottom for altcoins. Despite this potential surge, there is still ground to cover to reach the previous high of $451 billion set in December 2024.
The ongoing correction in the altcoin market cap, which has seen a shallower drawdown compared to previous bear market retracements, suggests a growing market maturity among altcoins. This reduced selling pressure and weakening resistance at the $425 billion mark indicate a higher likelihood of a breakout in the near future.
In conclusion, the altcoin market is showing signs of resilience and potential for a significant rally, buoyed by technical signals and market dynamics. As investors monitor the altcoin market cap’s performance in the coming weeks, the possibility of an altcoin season looms on the horizon, offering new opportunities for traders and enthusiasts alike.