Altcoin Rally on the Horizon? Ethereum May Hold the Key
Altcoins are over 50% off their all-time highs, but attitude is changing. Bulls expect a broad surge after Ethereum breaks its resistance zone. ETH has been consolidating since early May, and altcoins have struggled to build momentum without a clear signal from the market's second-largest asset.
Runefelt shows that altcoins are bouncing off BTC support by studying the TOTAL3 chart, which measures the market cap of all cryptocurrencies except Bitcoin and Ethereum. If capital movement from BTC to altcoins intensifies in the next sessions, this rebound might signal a recovery rally.
Historically, altcoins prosper when Ethereum leads. A move over $2,800 might spark mass involvement and a new altseason. Current market structure implies many investors are positioning early, hoping macroeconomic certainty and market stability would drive risk-on behavior.
An official rally has yet to be announced. Ethereum must break out forcefully and maintain momentum above recent highs for bulls. If that occurs, many oversold cryptocurrencies might rebound sharply and spark a market growth. As traders examine ETH and TOTAL3 for signs of a rally, patience and timing are essential.
After a prolonged decline, the TOTAL3 chart, which tracks the crypto market size minus Bitcoin and Ethereum, is showing early indications of recovery. Currently, the chart shows a rebound from $830 billion, which is near to the 100-week SMA, which acts as dynamic support. Mid-cycle consolidations have often pivoted at this level.
Bullish momentum is rising as the market value approaches $875 billion, still 40% below the last cycle's top. The weekly candle's robust green body suggests cryptocurrency interest has returned
This rally might start a new macro leg higher if the 50-week SMA is recaptured and pricing holds above $900 billion. Higher lows since late 2022 and price compression into a breakout shape make the structure positive.
