Bitcoin (BTC) dominance declines, altcoins' "cup and handle pattern" suggests a new wave of pump.

Since July, the total market capitalization of Crypto Assets has increased by more than 15%, setting a historical high of $3.8 trillion at the start of this week. Against the backdrop of regulatory pressure and political deadlock in the United States, Bitcoin (BTC) surged to a historic high of $123,218, catalyzing a broader market recovery. However, Bitcoin Dominance continues to decline, and alts have not been absent in this round of pump.

Ethereum (ETH) is steadily increasing its dominance, gradually eating into Bitcoin's market share, indicating that investors' risk appetite is strengthening. Veteran analyst Peter Brandt pointed out that the total market capitalization of crypto assets, excluding Bitcoin, is showing a cup and handle pattern, which may signal the start of the next altcoin season.

Bitcoin's dominance declines as altcoins like Ethereum rise

Bitcoin dominance refers to the percentage of Bitcoin's market capitalization relative to the total market capitalization of Crypto Assets. During the altcoin seasons of 2018 and 2022, the rotation of funds from Bitcoin to alts triggered a significant decline in Bitcoin dominance.

At the time of writing this article, Bitcoin's dominance accounted for the largest share at 62.89%, down from 66% on June 27. If the weekly closing price falls below the support level of 63.15% from the closing price on May 11, Bitcoin's dominance may continue the downtrend to the 60.90% level of the 50-week Exponential Moving Average (EMA).

(Source: Trading View)

On the other hand, Ethereum's dominance has surged from 9.04% on June 27 to 11.02%, indicating that ETH's strength relative to BTC has increased. The ETH/BTC chart shows that so far this week, Ethereum has risen 16% against Bitcoin, further confirming this.

(Source: Trading View)

The loading season of alts forms a bullish pattern

As market sentiment improves, the total market capitalization of crypto assets reached a historic high of $3.8 trillion on Monday. The CMC Fear and Greed Index, which measures market sentiment, stands at 70, indicating a heightened risk appetite in the market.

(Source: CMC)

At the same time, the CMC Altcoin Season Index is 38, while on July 1 it was 23, indicating that funds are shifting from Bitcoin to alts. Typically, an index above 75 indicates that the altcoin market is in a bull season.

(Source: CMC)

The rotation of funds has driven the total market capitalization of Crypto Assets (excluding Bitcoin, TOTAL 2) to rise over 8% this week, reaching $1.41 trillion. Bran pointed out that a cup-and-handle pattern has emerged on the weekly chart of TOTAL 2.

The analyst emphasized that the market neckline is at $1.70 trillion, close to the historical high of $1.71 trillion set during the altcoin season of 2021. If the weekly closing price is above this level, it could signify the start of a new round of altcoin season cycle.

In this situation, the market capitalization of alts may突破 the 2 trillion dollar barrier, pushing the entire market valuation over 4 trillion dollars.