Crypto Market May Enter Altcoin Season Soon, Analysts Explains Why

The altcoin crypto market cap is holding strong above $700 billion. It signaled sustained investor confidence across broader segments of the crypto market. In recent months, a steady accumulation level between $600-$700 billion was observed for the entire crypto market capitalization except for Bitcoin and Ethereum. At the same time, the Altcoin Season Index showed the initial hints of a trend turnaround, starting in May 2025 after a consistent decline throughout 2025. Technical analysts suggested that this breakout from the wedge structure could set the stage for a recovery phase. It could push altcoin valuations closer to the $1.15 trillion mark. This projected move represents a potential 50% increase from the breakout level near $770 billion. Investors are observing these developments as early indicators of a transition from a Bitcoin-dominant cycle to a broader altcoin-driven phase. Altcoin Crypto Market Cap Holds Key Support Zones Crypto analyst Michaël van de Poppe has identified the $600B–$700B range as an essential area for altcoin stability. His chart analysis of the total crypto market cap, excluding BTC and ETH, pointed to this range as a foundational level, where investors may seek opportunities for accumulation. The market price was currently retesting this level after a previous uptrend movement in the first quarter of the year. As for Van de Poppe, who labeled this retracement as a dip buying signal, the ‘V-shape support’ zone could be a long-term support level. However, the term does not necessarily mean a rise in value for investors. It has remained stable in this sector. It, therefore, implies that investors are still interested in holding altcoins as part of their long-term portfolio. Volume data further supports this observation, showing increased activity during market pullbacks and near key structural levels. Analyzing the technical aspects, the RSI (Relative Strength Index) was still at the middle level. It did not indicate an overbought or oversold signal of the market. This provides room for continued price movement in either direction. However, the sustained hold above $700 billion implied that investor sentiment did not weaken substantially. If this base continues to hold, analysts suggest the market may be preparing for further expansion. Altcoin Season Index Breaks Downtrend An independent analysis by Titan of Crypto has brought attention to the Altcoin Season Index. It is a metric used to assess whether market momentum favors Bitcoin or altcoins. The index had been trending downward since late 2024. It consistently stayed below the level of 25, a zone historically associated with a Bitcoin-dominant cycle. However, in May 2025, the index broke above this long-term descending trendline, reaching a reading of 29. This development marked the end of a prolonged downtrend within the index. The pattern formed over several months resembled a falling wedge, a structure that is often considered a precursor to price reversals. The breakout through the wedge’s upper boundary is being monitored. It may represent a shift toward growing strength in altcoins relative to Bitcoin. While the index remains below the threshold of 75, which would formally signal an altcoin season, the move above the falling wedge pattern is considered a structural change. Analysts note that similar historical breakouts have preceded rallies in top altcoins. Breakout from Wedge Pattern Suggests Potential Growth Another view on the altcoin market structure from analyst Carl Moon identified a breakout from a multi-month falling wedge pattern on the total crypto market cap (excluding Bitcoin and Ethereum). According to his assessment, the market cap breached this pattern in late April 2025, with current levels hovering around $770 billion. His chart placed the next potential target near $1.15 trillion. This level previously acted as a resistance during earlier market cycles. This projection would represent nearly a 50% increase from the point of breakout. It would align with typical technical behavior observed after similar formations. Moon’s analysis suggests that the breakout could mark the beginning of a broader rally, provided that volume remains consistent and higher lows continue to form. Source: https://www.thecoinrepublic.com/2025/05/10/crypto-market-may-enter-altcoin-season-soon-analysts-explains-why/