- The 2021–2023 bear market formed the rounded cup base as altcoins faced deep drawdowns, capitulation, and gradual smart money accumulation.
- Market consolidation between 2024 and 2025 produced a clean handle formation, setting up the neckline breakout at $1.6 trillion.
- Federal Reserve cut odds at 97.6 percent strengthen liquidity conditions, supporting momentum and fueling altcoin expansion toward multi-trillion targets.
The altcoin market is displaying one of the most recognizable technical formations, with analysts pointing to a potential multi-trillion market cap breakout.
Cup Built in Pain, Handle Formed in Disbelief
According to Merlijn The Trader, the current structure resembles a classic cup-and-handle formation. He noted that the “cup” was forged during the prolonged bear market of 2021 to 2023. In that period, altcoins faced persistent drawdowns, leading to widespread capitulation. Despite the pressure, projects continued building, and accumulation took place, laying a rounded foundation on charts.
The next phase, described as the “handle,” developed through 2024 and 2025. Market conditions during this stage reflected deep skepticism. Every price rally raised questions while each decline invited renewed caution. Instead of collapsing, the market consolidated into a clear handle structure, which is often considered a precursor to stronger price momentum.
Currently, the neckline of this pattern sits around $1.6 trillion in total altcoin market capitalization. A confirmed breakout above this level is viewed as the potential beginning of a new cycle. Merlijn emphasized that this would not only validate the pattern but could also accelerate market sentiment rapidly.
The trader summarized the setup as “cup built in pain, handle built in disbelief, breakout built in euphoria,” stressing the possibility of an exponential rally.
Breakout Level and Supportive Conditions for Altcoins
The technical target projected from this formation places the altcoin market cap in multi-trillion dollar territory. Analysts suggest that surpassing this neckline could open the path for a supercycle, transforming the current crypto landscape.
Merlijn The Trader cautioned that hesitation may result in missed entries, with participants potentially forced to buy at much higher valuations. He argued that the blueprint of the structure signals opportunity rather than risk for early positioning.
At the same time, market conditions appear supportive. Anup Dhungana pointed to the latest Federal Reserve outlook, noting that cut odds currently stand at 97.6 percent. Lower rates are expected to increase liquidity, providing favorable momentum for both Bitcoin and altcoins.
The combination of technical structure and macroeconomic tailwinds has drawn heightened attention from traders. Observers suggest that if the breakout holds, altcoins could transition into the next parabolic phase.
