Is Altcoin Season Here Yet? What Glassnode Suggests

As the crypto sector has seen an uplift recently, traders have been wondering if the altcoin season is here. Here’s what Glassnode says.

Glassnode’s Altcoin Season Indicator Shows Largest Risk-On Signal In 2 Years

In its latest weekly report, the on-chain analytics firm Glassnode has discussed what the altcoin market is looking like right now. Earlier, the firm had devised an “Altseason Indicator,” which, as its name already implies, monitors the rotation of capital happening toward the altcoins.

Note that “alts” here refer to all cryptocurrencies that aren’t Bitcoin, Ethereum, and the stablecoins. The Altseason Indicator works by checking for two conditions.

First, it confirms whether the three major asset classes in the sector (BTC, ETH, and the stables, as mentioned before) are receiving capital inflows. The metric uses the realized cap of the former two cryptocurrencies and the latter’s supply to track the changes.

“Historically, Bitcoin tends to lead the digital asset market, with market confidence then flowing towards Ethereum, and then further out on the risk curve from there,” explains Glassnode.

Thus, inflows into all three are when the market is starting to show a risk-on approach. The second thing that the Altseason Indicator checks is the momentum in the total market cap of the altcoins.

More specifically, the metric finds whether the total valuation of the alt sector is more than its 30-day simple moving average (SMA) or not. When these two conditions turn green together, the Altseason Indicator suggests the presence of a risk-on environment.

Now, here is a chart that shows the instances where the Altseason Indicator flashed positive during the past few years:

Looks like the metric has been giving a green signal in recent days | Source: Glassnode's The Week Onchain - Week 44, 2023

As displayed in the above graph, the Altseason indicator turned positive on 20th October. What followed this was Bitcoin’s Go to Source to See Full Article
Author: Keshav Verma

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