- Bitcoin’s dominance has climbed to 65%, placing pressure on altcoins and dampening hopes for a near-term altcoin-led rally.
- Technical indicators show altcoins moving in cycles with low volatility, yet current valuations remain within statistically reasonable zones.
- A 2015 DCA simulation shows altcoins outperforming Bitcoin, but recent cycles reveal only a few top altcoins outpacing BTC.
Altcoins are underperforming as Bitcoin dominance reaches 65%, sparking fresh debate across the crypto landscape. According to On-Chain Mind, the altcoin market is lagging in comparison to Bitcoin’s sustained strength, raising questions on whether a shift is near.
Bitcoin’s current lead has placed altcoins in a difficult position. The analysis references the Total 2 chart — the total crypto market cap excluding Bitcoin — which has been oscillating near the 200-day moving average. While this indicates a level of resilience, it lacks the explosive movement seen in traditional altcoin rallies. Without strong retail engagement or supportive macro trends such as quantitative easing, an alt season remains uncertain.
Market Signals from Technical Indicators
In a recent post, OnChainMind explained that multiple technical indicators are providing mixed signals. The Total 2 Rate of Change indicator displays a cyclical wave pattern, suggesting the altcoin market continues to follow its historical rhythm. However, there is no clear sign of breakout momentum.
The altcoin vertex, a smoothed z-score metric, currently shows valuations in a light green zone. This does imply that altcoins are not in overbought territory, but they may not have a strong bullish catalyst. Also, the volatility pulse is still low—the relative volatility of the altcoins to the historic level of volatility. This could suggest a lack of trader excitement or cautious capital deployment.
Historical Performance and Caution in Selection
Historical data presents a complex picture. A dollar-cost averaging model from 2015 shows altcoins outperforming both Bitcoin and equities over time. Yet when using the 2021 bull market peak as a starting point, Bitcoin has outpaced most altcoins.
On-Chain Mind also examined the returns of the top altcoins from peak last cycle. Only four of the ten were able to outperform Bitcoin, with Solana being the best performing altcoin last cycle. The mixed returns certainly reinforce the need for spot selection in the altcoin space.
While Bitcoin continues to be the number one asset, these data points suggest some altcoins may still offer potential. Market participants need to be diligent in navigating the cycle data investing.
