Altcoin
Altcoin Season Hopes Rise as Bitcoin Price Forms Bullish Pattern
Cryptocurrency traders are gearing up for the upcoming altcoin season as Bitcoin forms an extremely bullish trend on the weekly chart.
Bitcoin (BTC), the largest cryptocurrency by market cap, has formed a cup and handle chart. This pattern is characterized by a rounded bottom forming the cup and a consolidation or pullback forming the handle. The top of this pattern was at $68,837, while the handle section has been forming since March of this year.
It is important to note that it formed a fall widened wedge model in its handle section. It also found a strong support level at the 50-week moving average, below which it failed to move in July.
Bitcoin Price | chart of Trading View
A good example of the cup and handle pattern in action occurred in gold. On the monthly chart, it formed the cup section between September 2011 and July 2020. It then formed the handle section and made a bullish breakout to a record high of $2,485 this month.
Bitcoin and gold have a certain relationship. In a recent declarationLarry Fink, founder and CEO of Blackrock, said he sees Bitcoin as a digital gold that will succeed due to growing geopolitical problems and the growing US government debt.
Gold price | chart of Trading View
Additionally, Bitcoin has some solid fundamentals. Demand is rising as institutional investors buy through ETFs, while the Federal Reserve is expected to start cutting interest rates as early as September. Supply has been hampered by the halving event in April.
Fed rate cuts are positive for Bitcoin and other altcoins because they lead to risk sentiment among investors. In this case, some of the $6 trillion invested in money market funds will likely rotate into riskier assets like stocks and cryptocurrencies.
Analysts are also bullish on Bitcoin. Michael Saylor, the largest buyer of Bitcoin, expects the coin to rise to $13 million in his base case and $49 million in his most optimistic case. In a recent note, Ki Young Ju, the founder of CryptoQuant, noted that the bull cycle could continue until 2025.
#Bitcoin Bullish cycle likely until mid-2025
Old whales take profits during bull markets. Their sales bring new capital into the accumulation addresses, increasing realized prices.
Past cycles had profit taking periods of about 18 months. This time it started 4 months ago. pic.twitter.com/zkc8XxkmCiao
— Ki Young Ju (@ki_young_ju) July 26, 2024
Bitcoin sparks another altcoin season
A strong bullish breakout in Bitcoin will likely spark another altcoin season. Altcoins, including meme coins, historically do well when Bitcoin is up.
For example, an altcoin like Solana (SOL) rose to a multi-year high of $210 in March, when Bitcoin surged to its all-time high. Similarly, Cardano (ADA) reached $0.81 while Polygon (MATIC) jumped to $1.2887.
Recent performance shows that meme coins outperform their larger counterparts when there is an altcoin season. Meme coins like Pepe (PEPPER), Dogwifhat (WIF), and Popcat have performed better than the bigger coins this year.
Many traders love these meme coins because of their low prices compared to Bitcoin. In this case, it is always better to buy a token like Book of Meme (BOME) that was trading at $0.011 instead of Bitcoin that is trading at $66,000. Meme coins are also highly volatile and have high volume.
I’ve been a day trader for a long time and memes are a great way to gain that perspective.
Lots of volume.
And there’s a lot of volatility.When it comes to $BRETTI would look for long positions in this area between $0.125-0.1325 and $0.170 as a clear identification of a potential bull run. photo.twitter.com/hWmSjCZGJa
— Michaël van de Poppe (@CryptoMichNL) July 26, 2024