Forward the original title: Decoding Altcoin Season: 6 Key Strategies to Seize the Opportunity

1. When Will Altcoin Season Arrive?

I believe the altcoin season is just around the corner. Here are the key factors to watch:

1.1 Two-Phase Cycle

• Phase 1: Bitcoin’s price rises while altcoins decline (BTC market dominance increases).
• Phase 2: Bitcoin reaches a new all-time high, triggering a rapid surge in altcoins.

The chart below clearly illustrates this pattern:

During this phase, we begin accumulating altcoins when their total market cap hits a low range. I’m confident altcoins will eventually break new highs, just like Bitcoin.

Currently, Phase 2 has begun!
For more details, visit: Link

1.2 Capital Flow Trends

The bull market’s origin traces back to late 2023, when Bitcoin rebounded from its bottom, reclaimed its range, and climbed toward previous highs. Meanwhile, altcoins depreciated against Bitcoin, pushing BTC dominance higher.

Now, as Bitcoin hits new all-time highs (current phase), capital begins flowing into large-cap altcoins. From the Total 3 chart (total market cap of the top 100 altcoins excluding BTC and ETH), while the movement is primarily driven by large-cap coins like XRP, mid- and small-cap coins are starting to catch up.

Eventually, funds from Bitcoin and large-cap coins will gradually flow into mid- and small-cap altcoins.

As market sentiment heats up, investors grow greedier, chasing smaller altcoins. I predict the “other” mid-cap altcoins will soon set new highs. The real altcoin season is still ahead.

1.3 Bitcoin Dominance

Each cycle follows a similar pattern: when Bitcoin’s price breaks through previous highs and starts to surge, its market dominance begins to decline.

Currently, Bitcoin’s dominance has broken a rising trend that had lasted for over 800 days.

1.4 ETH/BTC Trend Analysis

In every cycle, Ethereum tends to underperform in the early stages (Bitcoin rises but still below its previous high), then starts to rebound once Bitcoin stabilizes above its previous high.

The current cycle is no different. More funds are expected to flow into Ethereum-based tokens, on-chain utility tokens, and higher-risk altcoins. Once ETH/BTC enters a strong upward trend, these tokens will likely perform better.

ETHBTC chart analysis

Currently, ETH/BTC has retraced and reclaimed the previous low range.

In 2021, it failed to break the Stage 4 resistance. Will we see the “super rally” of Stage 5 in this cycle?

If it breaks the current downward trend line, we could see the end of a 1,100-day bear market.

Additionally, 2024 is a pivotal year for the launch of the Ethereum ETF (Exchange-Traded Fund), and I believe the market is still underestimating Ethereum’s potential.

2. Have You Missed the Opportunity?

As mentioned earlier, the Amsterdam team has been accumulating altcoins over the past 5-6 months when Total 3 market cap was at its low. \
When the market hits a low range, it is advisable to:

• Buy at key support levels.
• Gradually build positions during a slow consolidation phase rather than chasing price rallies.
• Set clear stop-loss points (such as below the range).
• In quieter market conditions, it is easier to hold your positions.

However, if you choose to buy after a vertical price increase:

• You may not have a clear stop-loss point. While this might not be an issue for short-term traders, it increases risk for long-term investors.
• The opportunity for returns from the low to high range is already gone. The current bet is on whether altcoin market caps can break new highs.
• Buying during a rapid price increase means you will face higher market volatility, with 20-30% pullbacks not being uncommon.

So, I don’t think it’s too late for you, because:

• Bitcoin still has room for growth.
• The capital rotation hasn’t fully reached mid- and small-cap altcoins yet (the “Others” chart suggests a possible new high), meaning the most profitable stage is still to come.
• Bitcoin dominance might decrease further, while the ETH/BTC ratio will likely rise.

But please keep the following in mind:

• Understand the current phase of the market cycle.
• Be clear on whether you are entering a position for short-term trading or long-term investment.
• Have a clear profit plan in place.
• Know that this is a high-volatility phase, and 10%-30% rapid drops are possible.
• Accept that these rapid drops are difficult to predict. If you try to trade these pullbacks, you may disrupt your original long-term investment plan.

For a risk analysis on entering the market at this stage (rather than over the past 3-6 months), please refer to this link.

3. How to Enter the Market:

If you missed the past 6 months of accumulation, the first thing you need to do is reflect on why you missed it.

It’s likely that emotions influenced your decisions:

• During a bull market, prices tend to rise quickly, with few noticeable or sustained pullbacks.
• Many people miss the initial rally, and when they get FOMO (Fear of Missing Out) and chase the price upwards, the market often enters a consolidation phase or experiences a sharp correction.
• During consolidation, they become pessimistic and end up missing the next quick rally.

The correct strategy is: accumulate during consolidation or pullbacks, and stay patient, focusing on the market structure in the longer time frame.

For more details, refer to this section.

Next up are specific suggestions!

Advice 1: Stick to Spot Trading, Avoid Leverage

Prioritize spot trading.

Many people are used to using leverage, but this is actually a trap. Every market fluctuation feels like an “opportunity,” but in most cases, it’s not. There’s no need to rush into trades. Leverage trading will ultimately lead to losses and even wipe out your capital—don’t let it ruin your bull market gains.

Stick to spot trading, so you won’t be forced to close positions due to excessive leverage or, worse, miss out on market opportunities because of forced liquidations.

Trust me—stay away from leveraged trading.

Advice 2: Don’t Chase Prices, Focus on Pullbacks

Most people trade based on emotions, buying only when prices are rising (green candles) because it feels “safe.” \
But the market doesn’t move in a straight line, even in a bull market, there will be pullbacks:

• Daily fluctuations: small pullbacks of a few percentage points.
• Every few weeks: 10%-30% panic-driven drops.

If you buy when prices are rising, you’re likely to panic and sell when the pullback happens.

• Buying during a rise feels reassuring.
• Selling during a drop feels like relief.

But the correct strategy is:

• Buying during pullbacks might make you feel uneasy, but it’s the right time.
• Selling during a dip might feel reluctant, but it’s the rational choice.

If you can go against the crowd, building positions during pullbacks and buying boldly during panic sell-offs, you will have an advantage over most market participants.

Advice 3: Build Positions Gradually and Be Patient

So far:

• Stick to spot trading.
• Don’t chase prices, but accumulate during pullbacks.

Also, there’s no need to invest all your capital at once.

You can choose to build positions gradually. If the price drops 5%, and you invest all your funds in altcoins, then if the market experiences a bigger correction (such as a 10%, 20%, or even 30% drop), you might panic and sell.

The correct strategy is: when the price drops by 5%, invest 10% of your capital. This way, if the price pulls back further (such as 10%, 20%, or 30%), you can continue adding to your position rather than being shaken out by market volatility.

What if the pullback doesn’t deepen? No problem. Don’t invest all your capital at once just because you fear missing out; you might be forced to exit during a deeper pullback.

There will be more opportunities for pullbacks and position building in the future.

In highly volatile markets, you can’t perfectly time every move. You don’t need to buy at the lowest or sell at the highest; just focus on long-term gains.

Advice 4: Manage Risk and Avoid Over-Leveraging

You may have heard of those legendary stories where people made millions by going “all-in,” but excessive risk-taking will seriously test your psychological endurance. If your position is too heavy, during a market pullback, you may be forced to sell out of panic, ultimately missing bigger opportunities.

Advice 5: Create a Plan That Works for You

Don’t blindly follow other people’s plans; instead, design a clear investment strategy based on your own goals and risk tolerance. This plan should include risk management and multiple contingency options in case the market moves differently than expected.

A good plan will help you stay calm amid market fluctuations, avoid making mistakes due to panic or overexcitement, and gradually achieve your profit-taking goals.

Key points to clarify in your plan:

• Keep it simple: Don’t make the plan overly complex.
• Focus on higher time frames (HTF): Focus on the broader trend, not short-term fluctuations.
• Set clear goals:
  • What market signals am I looking for?
  • Which tokens do I want to invest in, and why?
  • How much capital do I plan to invest?
  • At what price ranges will I build positions?
  • When will I exit?

For how to create a periodic profit-taking plan, you can refer to this tweet.

Advice 6: Focus on Higher Time Frames and Keep the Strategy Simple

• Only focus on higher time frame (HTF) charts to avoid being distracted by short-term fluctuations.
• You only need to focus on key price levels and market structure, ignoring excessive market noise.
• Keep the strategy simple and clear.

Even simple strategies can give you an edge in the market:

• Most people use leverage, but you don’t.
• Most people chase the price when it’s rising (green candles), but you don’t.
• Most people don’t have a clear profit-taking plan, but you do.
• Most people buy or sell all at once, but you choose to build positions gradually and exit slowly.

Before Sharing My Altcoin Watchlist, Let’s Talk About One Key Point:

Viewpoint:

In the current market, altcoins (“Others” market cap) are likely to hit new highs and attract funds from Bitcoin and major altcoins.

Currently, the “Others” market cap is slightly above the mid-range and gradually approaching the upper range. \
It’s important to note that the upper range is usually a strong resistance zone, and before it breaks through, there may be multiple tests and pullbacks. When the market is strong (like today with all the “green” candles), this point is often overlooked.

Looking back at Bitcoin’s performance before it broke through the upper range: it went through several pullbacks and consolidations before successfully breaking out.

Even during the last bull market cycle, at the beginning of the altcoin season, the “Others” market cap chart experienced a 30% correction before breaking through the upper range.

So remember the following points:

• The market is likely to experience a larger correction, perhaps even several weeks of declines, before a full-blown alt-coat season arrives.
• But instead of trying to predict these pullbacks and wait, adopt the following strategy:
  • Slowly build positions in batches: Gradually increase your position, do not invest all your money at once.
  • Avoid using leverage: Leveraged trading is extremely risky and may result in forced liquidation.
  • Buy on pullbacks: Focus on opening positions when the market is falling (red candles) rather than chasing prices when they are rising (green candles).

Stay patient and follow a long-term strategy, and you’ll be more likely to profit from market fluctuations.

1. $SOL

SOL is a strong-performing large-cap coin and has shown clear advantages in this market cycle — it’s worth keeping an eye on.

From a market cycle perspective, I expect SOL to break through the current resistance level and have significant upside potential once it enters the “discovery phase” (when the price reaches new all-time highs and the market explores its true value).

At this stage, you can consider building positions gradually, but note that the current price is near a key resistance zone. If you go all-in at this level, you might struggle with potential 10%-30% price pullbacks in the future. Therefore, it’s recommended to follow a gradual position-building strategy.

Additionally, stick to spot trading and avoid using leverage. Here’s my approach:

• Wait for the price to break through the resistance level before making a small initial buy.
• If the price continues to rise and stabilizes at a high level, you can continue adding to your position gradually.
• If the price pulls back to the lower range and breaks through again, that could present another opportunity to add.
• A pullback to the previous consolidation zone can also be a good time to build positions gradually.
• If the price rebounds after a correction and breaks the short-term downtrend line, consider adding more positions.

In summary, have a clear plan to deal with various market movements and gradually build positions through spot trading.

1. $BLUR

BLUR is a unique token. Earlier this year, it failed to hold the support at the phase 4 low (when the price failed to hold at the lower range), possibly due to the overall slump in the NFT market at the time.

Now, the NFT market is recovering. OpenSea may launch its token, and Magic Eden’s token will be launched next week.

With these positive events driving the market, combined with the current market and chart performance, BLUR could regain the attention of investors.

My main observation: when the price reclaims the previous low (as marked by the arrow on the chart), it could present an entry opportunity.

If the market declines again, you could try to build positions at the phase 3 low.

However, for me, this token is more suitable for short-term trading rather than long-term holding.

1. $MEME

The meme coin investment cycle is well-known even to casual investors. It’s hard to imagine a token called “MEME” launching on all the top exchanges without attracting widespread market attention.

The price structure of this token is very strong and is currently in phase 3. I will wait for the price to break and reclaim key levels before entering.

Additionally, this token is associated with a major NFT collection. As the NFT market recovers, the $ME incentive program is implemented, and the potential launch of the OpenSea token could further drive its upward momentum.

1. $WEATHER

$ORAI is an established AI token. Last week, it successfully reclaimed phase 4 (orange zone) in the short-term market structure, so I added some positions.

If the price pulls back to this range again, I will continue to add to my position.

I have also set price alerts, and when it breaks above the macro range low, that will serve as a new entry signal.

1. $ LOVE

Since TIA reclaimed and retested the phase 3 low, I have been holding it.

Currently, it is attempting to break through its current price structure. I believe if the price forms a clear breakout above the grey zone, a subsequent pullback will present a good opportunity to add to the position.

Disclaimer:

1. This article is reprinted from [techflowdeep tide]. Forward the original title: Decoding Altcoin Season: 6 Key Strategies to Seize the Opportunity. The copyright belongs to the original author[CryptoAmsterdam]. If you have any objection to the reprint, please contact Gate Learn Team, the team will handle it as soon as possible according to relevant procedures.
2. Disclaimer: The views and opinions expressed in this article represent only the author’s personal views and do not constitute any investment advice.
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