The crypto market is showing signs of a major shift as Bitcoin continues to hover above $105,000. Analysts observe that the bull market is transitioning into its "second half," where altcoins may take the spotlight if Bitcoin's dominance starts declining.
Market Sentiment Shifts Toward Rationality
Nick Ruck, Research Director at LVRG Research, notes that investors are now pricing in geopolitical and trade friction risks, leading to a more measured market approach. He states:
"Despite signs of economic contraction in the U.S., the tech sector remains attractive. Institutional investors continue deepening ties with crypto projects, reinforcing long-term confidence in Bitcoin."
Technical Indicators Show Mixed Signals
Recent Bitcoin performance reveals interesting patterns:
- Price Movement: Closed last week at $105,700 (-3% from previous week's $109,050)
- ETF Flows: $150M net outflow after 6 consecutive weeks of inflows
- Exchange Reserves: Bitcoin reserves declining while ETH/XRP reserves stabilize
Matteo Greco, Fineqia analyst, highlights growing stablecoin reserves on exchanges - indicating substantial "dry powder" waiting for investment opportunities.
On-Chain Metrics Suggest Room for Growth
Bitcoin's MVRV ratio currently stands at 2.2 (vs. historical peak of 3.7), suggesting the market might be in "late-cycle" phase but far from peak levels.
👉 Discover why analysts believe altcoins may outperform soon
Critical Support Levels to Watch
Bitunix exchange analysts identify key technical levels:
"$105,000 is Bitcoin's immediate support. Holding this level could sustain upward momentum, while a break below $102,700 may signal stronger risk-off sentiment."
The Coming Altcoin Rotation
Experts warn that declining Bitcoin dominance often precedes capital rotation into altcoins - a classic hallmark of bull market maturation.
FAQ Section
Q: What triggers altcoin season?
A: Typically begins when Bitcoin dominance drops below 40%, indicating capital rotation toward smaller-cap projects.
Q: How long do altcoin seasons last?
A: Historically between 60-90 days, though 2025's extended bull run may prolong this cycle.
Q: Which altcoins perform best?
A: Ethereum usually leads, followed by layer-1 protocols and sector-specific tokens (DeFi, NFTs, GameFi).
Q: Should I sell Bitcoin for altcoins?
A: Diversification is key. Maintain core Bitcoin holdings while allocating 20-30% to high-conviction altcoins.
Q: What risks accompany altcoin season?
A: Higher volatility, regulatory uncertainty, and project failures are common challenges.
👉 Learn how to navigate the altcoin market safely
Remember: Market conditions can change rapidly. Always conduct thorough research before making investment decisions.