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Bitcoin has surged over 7% since the start of the year, leading the crypto market in a promising rebound. While this upward momentum is fueling optimism, many investors are shifting their focus to altcoins, anticipating greater opportunities in the broader crypto space. Historically, BTC rallies often lay the groundwork for altcoins to follow, and current market conditions hint that this pattern might be repeating.
Top analyst Jelle recently shared a compelling technical analysis on X, pointing to a potential shift in the market dynamics. According to Jelle, TOTAL3—a market cap index that excludes BTC and Ethereum—appears poised to enter price discovery, a phase where assets test new highs due to increased buying pressure. Adding weight to this perspective, Bitcoin dominance, a measure of BTC’s share of the total cryptocurrency market, has just broken down, signaling a weakening of BTC’s market control.
These indicators suggest the onset of an alt season, a period when alternative cryptocurrencies outperform BTC. With BTC stabilizing near crucial levels, the conditions seem favorable for altcoins to capture investor attention. The coming weeks will be pivotal in determining whether this trend gains momentum, potentially reshaping the market landscape for 2025.
Time For An Alt Season
Bitcoin had a stellar 2024, reaching new heights and solidifying its position as the market leader. As 2025 unfolds, BTC continues to show strength, but a shift in market dynamics could be on the horizon. Historically, Bitcoin’s dominance often recedes during periods when altcoins gain traction, and this year could be no exception.
Top analyst Jelle recently provided insights into these shifting dynamics through a detailed technical analysis of TOTAL3 and BTC dominance. TOTAL3, an index tracking the market cap of altcoins excluding BTC and Ethereum, appears poised to enter price discovery—a phase where assets explore new highs driven by heightened demand. Simultaneously, Bitcoin’s market dominance has just experienced a significant breakdown, suggesting that altcoins may soon take the lead in capturing investor interest.
Bitcoin Dominance and TOTAL3 | Source: Jelle on X
Jelle’s analysis highlights that as Bitcoin stabilizes near key levels, liquidity often flows into altcoins, triggering what is popularly known as an alt season. During these periods, altcoins historically outperform BTC, providing substantial returns for investors willing to diversify.
The combination of Bitcoin’s strong foundation and the potential for altcoin outperformance sets the stage for 2025 to be a remarkable year for the broader crypto market. As TOTAL3 inches closer to price discovery and BTC dominance weakens, the opportunity for altcoins to shine becomes increasingly evident.
Price Action: Key Levels To Watch
Bitcoin is currently trading at $97,900, with the price testing the crucial 4-hour 200 Moving Average (MA) at $98,139. This level has become a pivotal point for BTC, as it determines whether the bulls can regain control and drive the price above the $100K mark. Reclaiming and holding above this level would signal renewed bullish momentum and pave the way for a strong breakout.
BTC nears 100K | Source: BTCUSDT chart on TradingView
However, the market remains cautious, and if Bitcoin fails to hold the 4-hour 200 MA, a period of extended consolidation could follow. This sideways movement would likely test the patience of traders and investors alike. The key support to monitor is the 4-hour 200 Exponential Moving Average (EMA) at $95,881. Losing this level could signal a deeper correction, raising concerns about a potential retest of lower demand zones.
For now, Bitcoin’s ability to hold above the 4-hour 200 MA and push higher will define its short-term trajectory. A sustained move above $98,139 and a breakthrough past $100K would confirm bullish strength. Conversely, a break below the 4-hour EMA could delay the next leg of the rally, leaving the market in a state of uncertainty. The coming days will be critical for BTC’s direction.
Featured image from Dall-E, chart from TradingView
