Altcoin enthusiasts have experienced a lot of suffering in 2022. Not only has the BTC price dropped drastically in the past 10 months, but the valuation of most altcoins against Bitcoin has also collapsed sharply.
Everyone is asking the question: When is the altcoin season 2022? In today’s analysis, BeInCrypto addresses this issue by looking at the altcoin market capitalization chart, altcoin seasonal indicators and the valuation of ETH against BTC. As a result, it appears that perhaps the worst period for altcoins is over and the market is on the verge of a massive altcoin season in 2022.
TOTAL2 starts an upward impulse
If we look at the chart of the altcoin market cap (TOTAL2), we see that it has only generated green lights in the last 6 weeks. This probably means that we are currently in the first wave of an upward impulse, which began with a low of $427.5 billion on June 18, 2022. So far, the altcoin’s market capitalization has increased by almost 60%, reaching a peak of 693 billion dollars.
But before that, altcoins, like the BTC market, experienced a sharp decline from the all-time high (ATH) of $1.7 trillion on November 10, 2021. Since then, the altcoin index has fallen along a descending resistance line (blue). ) and has been repeatedly rejected by it (red circles).
Then, in March, TOTAL2 broke out of this line (green arrow), suggesting that the 2022 altcoin season had begun. The rally was short-lived, however, as just three weeks later the index hit a local peak of $1.27 trillion and began an accelerated decline.
This led to reaching the aforementioned June low. This time the blue resistance line became support (R/S flip) and had already been validated twice. But before that, there was a significant breakdown from the long-term support line, which had been in place since February 2021 (orange line and arrow).
Currently, the line is expected to act as resistance and currently sits at around $1.05 trillion. Additionally, it is close to the 0.5 Fib retracement level, measured for the entire drop from the ATH.
Cryptocurrency Market Analyst @StockmoneyL tweeted a 5-day chart on TOTAL2. He compares the fractals of the current altcoin market and the period 2018-2021 with each other. The analyst points out the analogous structure, which in the coming weeks could lead to big increases and a booming altcoin season in 2022. Interestingly, if the fractal were to repeat itself again, the closest resistance would be around $1 trillion.
Altcoin season 2022 is already underway!
The analysis of the altcoin market cap chart and the similarities with the previous cycle are not the only reasons behind the continuation of altcoin price increases. According to data from BlockchainCenter, the 2022 altcoin season has just begun.
Their daily updated altcoin seasonal chart indicates that the index entered altcoin dominance territory in early August. As we read on their website:
“If 75% of the top 50 coins outperformed Bitcoin in the last season (90 days), it’s Altcoin season.”
On August 10, the altcoin seasonal index they created recorded a near-maximum value of 98. These levels have not been seen since the April-June 2021 period. Thus, if the index stays above the value of 75 in the next few weeks, we may experience a strong altcoin season 2022 in the near future.
In addition, the site publishes an overview of the TOP 50 cryptocurrencies in the last 90 days and compares them with the change in Bitcoin’s price. It turns out that BTC lost -20.2% in the current season, while most altcoins recorded gains or lost less.
Among the leaders are CEL (342%), ETC (109%), UNI (71%) and LINK (20%). Some of the biggest projects were also ahead of Bitcoin, although they experienced declines, such as ADA (-3.1%), ETH (-5.5%) and XRP (-12.6%).
Ethereum leaves Bitcoin behind
Another indicator of a potential altcoin season in 2022 is the performance of Ethereum (ETH), which is the largest altcoin, against BTC. The technical analysis of Ethereum against the USD indicates that there has been a dynamic increase in the ETH price in recent weeks. Additionally, it is possible that the RSI has broken out of the long-term resistance line and may continue to rise all the way to the $2100 level.
If we now look at the relationship with BTC, the weekly chart gives an even more bullish perspective. ETH/BTC has been rising since the bottom of 0.05 BTC, which previously served as resistance. Validation of this area was a bullish signal that started the ongoing rally.
Currently, ETH is at 0.081 BTC, rising 66% from the aforementioned low. Also, the week’s big green candle led to a breakout above the resistance area at 0.075 BTC (red line), which had previously repeatedly rejected the price (blue arrows).
Technical indicators confirm the initiation of a bullish trend. The RSI has broken out both above the falling resistance line (blue) and the 50 level. Meanwhile, the MACD has recently made a bullish cross and is generating increasingly higher bars with upward momentum. All these developments are strong signals for continued upward momentum.
Cryptocurrency Analyst @el_crypto_prof has drawn a monthly chart of ETH/BTC, in which he suggests that we are on the verge of a huge increase in Ethereum’s valuation against Bitcoin. He pointed out parallels in the fractals of historical upward waves, stating that today’s price action corresponds to the period in early 2017 (orange ellipses).
According to his prediction, ETH could see a 379% increase from the bottom in the coming months and reach 0.25 BTC. If this is indeed the case, Ethereum’s rise will be a powerful catalyst for the 2022 altcoin season.
For Be[In]Crypto’s Latest Bitcoin (BTC) Analysis, click here.
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