Altcoins Heat Up as Bitcoin Cools, But Is the Rally Ending Soon?

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Bitcoin is holding steady around $119,366 today with little movement, but altcoins have been stealing the show. Ethereum, XRP, Solana, Dogecoin, and Cardano are all seeing solid gains between 3–8%. 

Altcoin Season Index At 51

In just a few days, the Altcoin Season Index has risen from 39 to 51. Although a full-blown altcoin season is still far away ( above 75), the market is showing early signs of strength. ETH jumped to $3,793, its highest since early 2022. DOGE has stolen the show with a 9% surge, and is up 32% on the week. 

The CMC Altcoin Index is currently at 56. Coinglass notes that the Altcoin Season Index is climbing quickly, but so far, only a few altcoins are showing strong gains. If Ethereum breaks above $4,000, then it could trigger a major surge across the altcoin market.

According to analyst Michael Van De Poppe, the current price action suggests the market may be slightly overextended in the short term, which could lead to a swift and sharp correction. However, this would likely be a healthy pullback within a broader bullish trend. Overall, the next six months will be massively bullish for altcoins. 

Meanwhile, Bitcoin’s dominance has dropped sharply, down 5.8% in a week to just under 61%, its lowest level since March. This shift shows that traders are moving away from BTC and into altcoins. Altcoins, with ETH at the forefront, have taken the lead in the latest market rally. 

TOTAL2 Nears Major Breakout

Analyst Moustache is pointing out that the TOTAL2 chart (which tracks the altcoin market cap) is about to break above a trendline that’s held for 8 years. If the 2-week candle closes above this line, it could signal the start of a strong altcoin bull run.

Expert Benjamin Cowen highlights a key shift in the altcoin landscape. In April, he warned that ALT/ETH pairs would likely reverse and since then, they’ve dropped 40%. While some traders were quick to dismiss ETH, Cowen points out that altcoin liquidity is now flowing right back into it.

He also pointed out a familiar pattern: just as BTC dominance surged from 38% to 66%, there are now claims that altcoins will outperform ETH. But the numbers tell a different story as ETH/BTC is rising while ALT/ETH is down 40%.

Altcoin Rally Could End by Late August?

Benjamin Cowen says that Ethereum is doing better than most altcoins right now. Altcoins are up against BTC only because ETH is up, but they are down 40% against ETH. The altcoin rally might end by late August, and BTC dominance could rise again in September or October.