In every digital currency market cycle, investors ask an important question: Is it time for altcoins? Or does dominance still favor Bitcoin? In 2025, several indicators suggest a potential change in trend, with clear signs of the beginning of what is known as "Altcoin Season." This article reviews the key technical and behavioral indicators that analysts monitor to determine the extent of momentum shift from Bitcoin to altcoins. It also highlights BTC dominance, Altcoin Season Index, ETH/BTC ratio, liquidity movement, and investor psychological data to empower the reader to build a smart investment vision.

First: What is meant by "Altcoin Season"?

The term "Altcoin Season" is used to refer to periods when altcoins rise at a rate higher than Bitcoin. These periods usually follow a significant price increase in Bitcoin, as investors begin to shift their profits towards lower-value coins in search of faster growth opportunities. The Blockchain Center uses a special index called the Altcoin Season Index, which compares the performance of 50 altcoins against Bitcoin over the last 90 days. When this index exceeds 75%, analysts consider it a clear indicator that we have entered Altcoin Season.

Second: BTC Dominance and ETH/BTC Ratio: Trend Reversal Signals

One of the key indicators that traders rely on to determine the start of Altcoin Season is the Bitcoin Dominance ratio. When this ratio begins to decline after a price surge, it usually indicates a shift of liquidity towards altcoins. In May 2025, data from TradingView showed a drop in BTC dominance from 54% to 48% in just two weeks, an initial signal of momentum shift. The ETH/BTC ratio is another critical indicator; when Ethereum's price rises compared to Bitcoin, it reflects the market's readiness to give altcoins a chance to dominate. The ratio rose to 0.07 in early May, the highest level in 18 months.

Third: Liquidity movement between digital assets

What enhances the likelihood of Altcoin Season is the phenomenon of "Capital Rotation", where capital moves from Bitcoin to promising altcoins such as Solana, Avalanche, and Arbitrum. According to Glassnode, daily financial flows in altcoin markets have increased by 23% compared to April. It is also noteworthy that coins with small to mid-market capitalizations have started recording double-digit increases within hours, a behavior commonly seen during previous Altcoin Seasons.

Fourth: Psychological Indicators and Investor Behavior

The psychological analysis of traders is an important complement to technical analysis. In May 2025, the Fear & Greed Index shows a shift towards "greed," indicating that traders are becoming more willing to take risks and invest in high-gain altcoins. The increasing use of tools such as Copy Trading and Trading Bots on platforms like Binance demonstrates investors' desire to keep up with rapid market movements. You can find smart trading tools at the following link:

https://www.binance.com/en/trading-bots

Fifth: Is it time to adjust the investment strategy?

Looking at current technical and psychological indicators, many analysts believe that the market has already entered the first phase of Altcoin Season. This does not necessarily mean abandoning Bitcoin, but rather highlights the importance of diversifying the investment portfolio and considering allocating a portion of capital to altcoins with strong fundamentals, active communities, and real projects. However, caution should be exercised against random investing or chasing 'hype', instead focusing on selecting coins with promising economic and technical data.

Conclusion

May 2025 is considered a pivotal month in the digital market movement, as data indicates a shift in momentum dynamics from Bitcoin to altcoins. By monitoring indicators such as BTC dominance, ETH/BTC ratio, capital rotation, and overall market sentiment, investors can make informed decisions and achieve potential gains in the upcoming market wave. But always remember: risk management is the essence of any successful strategy, so do not invest more than you can afford.

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As always, it is important to do your own research and consider your risk tolerance before making any investment decisions. Stay informed by checking the latest prices and market trends, and follow me on social media, and consider leveraging the current market conditions to enhance your cryptocurrency portfolio.

Written by: Dr. Mohammed Al-Hamiri @AlhemairyM