The altcoin season is a regular event coming back and forth every now and then without any official warnings. Sometimes referred to as the alt season, this specific time is often triggered by various indicators, so some may actually have a few clues about its return.
To fully understand the altcoin season and how to benefit from it, you need to understand what it means and what kind of changes it brings in. Here’s everything you have to know about the alt season at a glance.
What’s altcoin season about?
Altcoin season is a certain time frame when money simply gets out of the world renowned Bitcoin and flows into altcoins, simple as that. This specific element will obviously show a significant change in digital currency prices.
Basically, Bitcoin will lose a significant amount of value, while other less popular coins will gain in value.
To keep it simple, Bitcoin loses some of its dominance. That means prices go down. It could be anything. It could go from $50,000 to $20,000 or from $40,000 to $30,000. There are, indeed, some unwritten rules because not every negative fluctuation is considered part of the altcoin season.
Bitcoins do have a major share on the cryptocurrency market. After all, it’s the oldest and one of the most reliable digital coins out there. As Bitcoin loses in value, other coins will get more. These coins are usually referred to as altcoins.
If you think about it, given the massive fluctuations during this season, crypto traders can actually make a fortune. This period is not very common, but it’s incredibly rewarding.
Making money on these price movements will lead to significant profits, but at the same time, some people use altcoin season to diversify their portfolio, too.
While difficult, altcoins may also have the possibility to outperform Bitcoin. The secret to enhancing your crypto trading journey is to know when to react. It’s all about seizing the moment, and fortunately, there are some hints too.
To make money, you need to understand what drives such a financial move. There are some factors behind it, and paying attention to them can help you optimize your strategies.
Signs that altcoin season is coming
The Bitcoin dominance chart hides some secrets
To many newbies, the Bitcoin dominance chart is all about some brief comparisons between different digital coins. The so-called BTDC has more than that to offer. In fact, this chart may hold the first signs that altcoin season may approach soon.
Now, Bitcoin’s dominance will go up and down based on more factors. When the dominance decreases, it means other coins get a bit extra. This means more people are currently selling Bitcoin, only to focus on other coins or for personal needs.
This is usually the main step that the altcoin season may occur soon. On the same note, when the dominance goes up, the altcoin season is less likely to start too soon. It’s common sense, indeed, but lots of new traders overlook this concept.
Ethereum separates from Bitcoin
Bitcoin is synonymous with cryptocurrency. Less experienced people use these terms interchangeably. Those with a bit of experience know that there are more digital coins out there. Bitcoin clearly dominates the market, but others have also gained some decent value. Plus, they seem to keep it, too.
Ethereum is by far the main competitor of Bitcoin. Some see it as an improved version of Bitcoin despite not being as popular. Keeping an eye on its price movement is just as important when trying to spot altcoin season at an early stage.
Ethereum is a leading altcoin, so its performance drives the whole altcoin market. Pay attention when it’s separating from Bitcoin in value. If it keeps going up while Bitcoin loses, that’s a pretty good sign that you should get ready.
Keep an eye on altcoins
Sometimes, while most of this season revolves around Bitcoin, it’s worth paying attention to altcoins as well. In fact, altcoin investments can be just as profitable if you buy and sell at the right time. In other words, keep an eye on their prices as well.
To keep it simple, market capitalization relates to the overall value of all altcoins together. Look at the current conditions of the market and compare them to historical information. You’ll be able to find patterns, ideas, similarities, and indicators.
Altcoin seasons often follow the same cycles, meaning patterns go up and down. Making predictions on various trends has never been easier, but then again, this is the right type to start learning about other currencies, too.
Feel the market vibe
The vibe, the sentiment, you name it. Traders tend to get carried away, especially as they lack experience. They can still make calculations and see trends, yet their sentiments and feelings often kick in and take over. That’s what leads to irrational trades.
Of course, it’s exciting to make profits when markets grow, but it’s worth keeping cool when they go down, too. Panicking is a no-no, especially if you’re thinking of selling right away.
You can find a few market analyses on the Internet, as well as some useful portals. But then, no one will really tell you when the altcoin season starts. It’s all about feeling it.
In the end
There are no doubts about it, everyone would love to know when certain coins gain and lose in value. That’s when you make the big money. The bad news is no one will ever tell you. Instead, you need to figure it out yourself based on various indicators.
