If you are to invest in cryptocurrencies, you must know two words - the Altcoin Season.
So, what is the altcoin season? Why are so many investors expecting it to come? How to make a profit from the altcoin season?
All will be mentioned in this article.
What is the altcoin season?
Altcoin season refers to the time when altcoins simultaneously increased sharply, with the profit increasing by x2, x3 or even x10 times in a few weeks.
Most typical example is the Altcoin season in September 09, when you closed your eyes to buy any random Altcoins, your assets would increase very quickly after that.
Signs of the upcoming Altcoin season?
After many times of observing the Bitcoin season, I have concluded that there are two prerequisites to help you realize whether the Altcoin season has come or not, that is:
- Bitcoin Dominance must be REDUCED.
- Cash flow must shift to Altcoin.
Bitcoin Dominance Reduction
Bitcoin Dominance is also known as Bitcoin's dominance rate in the cryptocurrency market.
When the rate is increasing, it is indicated that investors are tending to hold Bitcoin rather than Altcoins, so Altcoins will tend to decrease, because investors sell Altcoin to buy BTC.
When this rate tends to decrease, there are two cases:
- Investors tend to sell BTC to buy USD or USDT.
- Investors tend to sell BTC to invest in, and buy Altcoin.
Therefore, the reduced Bitcoin Dominance rate is considered a necessary condition for an altcoin season.
Cash flow shifted to Altcoin
According to my observations, there will be three scenarios of capital movement in the cryptocurrency market. Including:
Scenario 01: BTC> Altcoin Top> Mid-cap/LowCap (most often).
- Cash flow is deposited to increase Bitcoin price. At this point, holders of usd/usdt start to participate in buying BTC, pushing up the price of BTC.
- After that, BTC goes sideways, or tends to decrease slightly (adjusted), when cash flow is transferred from BTC to the top altcoins (large Cap), causing the price of these tokens to increase by 30-50%.
- After all, capital will be deposited into the mid and lowcap coins. While these altcoins are pumped, BTC will be pumped or dumped sharply, causing the sell-off to occur. This is also the way to end the cycle, making many people become reluctant holders.
Scenario 02: Midcap/Lowcap> Altcoin Top> BTC.
- Bitcoin would almost go sideways. At this time, the capital was deposited into the midcap and lowcap altcoins with very powerful pumps, x2 x3 within 1-2 weeks.
- At this time, investors began to see FOMO people pour money from usdt to buy pumped altcoins.
- Unfortunately, the capital flow would then flow back to the top altcoins, and eventually flow back to BTC, causing BTC to be pumped strongly, and then the sale will end the cycle of capital.
Scenario 03: This is the best and most ideal scenario, which only occurs when there is a large amount of capital flows into the market.
- At this time, if you close your eyes to buy randomly, you can make a profit easily, because the capital is too big, and it will flow to every corner of the market. BTC, Altcoin, and lowcap coins will all be pumped very strongly.
Summary: You need to observe the BTC Dominance, and the scenario of capital flows running in the market to be able to catch up the Altcoin season.
For example: Altcoin season in January to February 01.
After the price of BTC increased from $ 7,200 to $ 8,150, and BTC Dominance went up significantly to 70,52% after that, it started a downward trend despite a slight increase.
This is the first step that signals the Altcoin season. Soon after, the BTC pump attracted the attention of investors. During this period, BTC increased, but ALT/BTC did not drop sharply, causing the price of ALT/USDT to increase slightly according to BTC.
In the next phase (from January 25, 01 to February 2020, 14), capital inflows started to be poured into TOP, Midcap, and lowcap Altcoins, causing the prices of these altcoins to increase very strongly by 02% -2020%.
Meanwhile, the price of Bitcoin only increased slightly by 25%.
After that, BTC, and Altcoin all collapsed. That was the end of the Altcoin season.
Altcoin increase: (e.g. XTZ)
Bitcoin increased slightly:
What to do to increase assets fastest in Altcoin season?
When you have identified the signs that the Altcoin season is about to begin, you need to do the following:
- Determine where the stage of capital flows is.
- Review the coins that capital will flow into.
- Analyze the chart, and choose 1-2 coins to buy.
- Transaction planning: Entry, exit, loss-making, capital management, risk management, expectation management, and so on, and then conducting transactions as planned.
- After reaching the target, flip through un-pumped altcoins to take advantage of the compound interest.
If you find these things too complicated, join now Coin98 Trading Desk to discuss effective altcoin investment strategies.
The altcoin season has always been the happiest, most exciting period of the cryptocurrency market with pumps of x2 x3 x10 times of assets.
However, one person's joy will be the sadness of another, when they buy coins at the top price RING , just because they don't understand the nature of the altcoin season.
If you find this article useful, please share it with many other people so that they can know how to invest, and become the winners.