In the crypto market, there are periods when investors focus entirely on Bitcoin, and other times when momentum shifts to altcoins, which we call Altcoin Season.
During this season, many altcoins achieve much higher increases than Bitcoin in a short time, creating significant profit opportunities for smart traders.
But the question is: How do you know if the season has really started? In this article, we will review 5 key indicators that signal the market entering the altcoin season, along with the most important tips for benefiting from it safely.
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Indicator One: Decline in Bitcoin Dominance
Bitcoin dominance is the percentage of Bitcoin's value in relation to the total market value of all cryptocurrencies.
If this ratio starts to decline noticeably, it means that capital is shifting from Bitcoin to altcoins.
📌 Example:
If the dominance was 50% and dropped to 45%, you will likely notice that the prices of altcoins rise at a faster pace.
Indicator Two: Increase in ETH/BTC Ratio
The ETH/BTC pair measures the performance of Ethereum against Bitcoin.
If this ratio is increasing, it indicates that Ethereum – considered the leader of altcoins – is outperforming Bitcoin, often signaling a rise in other altcoins.
Indicator Three: Rise of Medium and Small Market Cap Coins
At the beginning of the altcoin season, investors start shifting from large coins like ETH and BNB to medium and small market cap coins in search of bigger profits.
This leads to a strong upward wave in coins that may be relatively unknown.
Indicator Four: Increase in Trading Volume on Altcoins
If you notice that trading volumes on certain altcoins are increasing unusually, this is a sign that liquidity is moving in their direction, often marking the beginning of an upward wave.
Indicator Five: Return of Meme Coins and Retail Enthusiasm
A strong indicator that we have entered the altcoin season is the return of meme coins and the enthusiasm of retail investors.
When you see new meme coins emerging significantly and gaining media momentum, know that the market is in a high activity state and we are likely in the middle of the season.
5 Tips for Trading in the Altcoin Season
1. Discover trends early
Try to identify the narratives or sectors that are in demand (like artificial intelligence, DeFi, GameFi) and invest in them before they spread.
2. Set clear entry and exit goals
You must determine from the outset your buying price and target selling price, and not get swept away by greed when the price increases.
3. Smart Transition Between Coins
Start with relatively large coins, and when you make profits from them, allocate part of it to smaller coins to increase your return.
4. Focus on the fundamentals, not just the hype
Even if there is a coin trending, review its project, team, and plan before you enter.
5. Take your profits before the music stops
The altcoin season can end suddenly, so make sure to convert your profits into stable coins or Bitcoin regularly.
Summary
The altcoin season is a golden opportunity to achieve significant profits, but it is also full of risks if you enter the market without a plan.
Monitor the five indicators: decline in Bitcoin dominance, increase in ETH/BTC, rise of medium and small coins, increase in trading volumes, and return of meme coins.
And use the tips we mentioned to protect your capital and benefit from the season as much as possible.
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