- Altcoin market nears $1.2T neckline, completing a Cup and Handle setup that may lead to a breakout to $2.7T–$3.3T levels.
- Ethereum and Chainlink outpace Bitcoin with 25%+ weekly gains, indicating capital rotation and altcoin momentum.
- Rising altcoin derivatives activity and liquidations show growing risk appetite as sentiment changes from Bitcoin.
A major bullish setup may be unfolding across the altcoin market, as technical analysts monitor a large Cup and Handle formation on the weekly chart of the total crypto market cap excluding Bitcoin and Ethereum.
This pattern, widely followed in traditional and crypto markets alike, has been forming since 2021 and now nears a potential breakout. The handle portion of the formation, which began in mid-2025, is nearing its completion.
With price levels once again approaching the $1.2 trillion neckline, the market is monitoring for a decisive move that could launch a major altcoin rally.
Handle Nears Completion as Price Presses Key Resistance
The Cup formation developed between mid-2021 and early 2024, during which the altcoin market bottomed near $400 billion. Since then, prices have steadily climbed back, curving up toward the $1.2 trillion mark.
From mid-2025, a smaller retracement shaped the handle, creating the conditions for a possible bullish continuation. Notably, the $1.2 trillion level represents the neckline resistance. A break above this level could validate the pattern.
Technical projections suggest that such a breakout might push the altcoin market cap toward the $2.7 trillion to $3.3 trillion range. A long-term diagonal resistance trendline, drawn from the 2021 peak, also intersects around $3.5 trillion to $4 trillion, reinforcing the importance of this region.
Ethereum and Chainlink Lead Rotation from Bitcoin
While Bitcoin dominance rose slightly to 60.13% today, it remains well below last week’s high of 63.65%. This gradual decline supports the idea that capital is rotating into altcoins. Ethereum’s market cap surged 39% in July, boosted by zkEVM advancements and real-world asset integrations with firms like BlackRock.
Over the past week, Ethereum gained 25.6%, while Chainlink rose 26.85%. In contrast, Bitcoin posted a minor 0.12% gain. This divergence highlights a clear shift in momentum, particularly toward Ethereum-based projects and infrastructures.
Derivatives Data Shows Increasing Altcoin Exposure
Further supporting the trend, derivatives markets reflect rising altcoin activity. Perpetuals open interest jumped to $839 billion, up 2.3% in the past 24 hours. Ethereum saw $46.96 million in long liquidations and $52.83 million in shorts, showing relatively balanced sentiment. Bitcoin liquidations, however, totaled $99.8 million—more than double the previous day.
This data suggests growing risk appetite in altcoins while Bitcoin faces increased profit taking pressure. The Altcoin Season Index currently stands at 50/100, reflecting neutral sentiment but a sharp increase of 233% over the past month.
Altcoin Market Builds Toward Breakout
Altcoins are approaching a critical resistance zone as the multi-year Cup and Handle pattern nears confirmation. Ethereum’s ecosystem developments, increased capital inflows, and rising derivatives activity highlight a strong rotation. If current momentum continues, the total altcoin market cap could move toward multi-trillion-dollar territory in the coming quarters.
