The altcoin season may continue as Bitcoin dominance declines and Ethereum outperforms Bitcoin.

• The altcoin season is in full swing: market capitalization has reached a record $4 trillion, and Bitcoin's dominance level has dropped to a multi-month low, signaling a rotation of capital.
• Analysts recommend exiting a position when the altcoin season index exceeds 70 or when TOTAL3 approaches the target figure of 2 trillion dollars according to the "cup and handle" pattern.
• The main exit signals are the leading BTC indicator ETH, the rise in activity of meme coins, and the drop of BTC.D below 50%, which is often a signal of the end of the cycle.

Altcoin investors started to make profits in July

Most investors in altcoins who started buying them in June are likely already seeing profits. This is due to the fact that since then, the market capitalization of altcoins (TOTAL2) has increased by 44%, reaching 1.5 trillion dollars.

The proprietary indicator from Glassnode confirms that the capital flow into altcoins will begin in early July.

Altcoin Season Indicator from Glassnode. Source: Glassnode

"The Altseason Indicator developed by Glassnode triggered on July 9. This means that the supply of stablecoins is increasing, capital is flowing into BTC and ETH, and at the same time, the market capitalization of altcoins is rising — a structural environment conducive to capital circulation," Glassnode reports.

Today, CryptoBubbles data shows a positive market trend. Many altcoins have increased by 10-20%.

Altcoin price dynamics on July 18. Source: CryptoBubbles

However, as history shows, the altcoin season at the end of 2024 ended with a sharp decline. Many altcoins fell by 50–90%. Many investors were unable to react quickly, and their portfolios sank deeper into losses.

That is why determining the moment to take profits is just as important as determining the start of the altcoin season.

Analysts recommend 4 factors for determining the exit time

The simplest and most widely used signal is the altcoin season index. This index is typically used to determine entry points. But when it reaches the upper limit, it also serves as a warning for the entire market.

As of the time of writing, Coinglass reports that the index is at 49 points. When it reaches 70–100 points, investors are advised to take profits.

Altcoin Season Index. Source: Coinglass

"The altcoin season index is rising, and the market capitalization of altcoins has significantly increased in recent days. When the index exceeds 70, it's time to sell altcoins. Right?" — reports Coinglass.

For other investors, the technical analysis of the market capitalization of altcoins (TOTAL3) serves as a benchmark. Analysts like Peter Brandt and Greeni believe that TOTAL3 is forming a "cup and handle" pattern.

TOTAL3 model with cup and handle. Source: Grini

Using the measurement theory of this model, TOTAL3 could reach a target of 2 trillion dollars. This could be a key moment for altcoin holders to consider exiting the project.

Some investors track the capital movement cycle to determine when the season may end. For example, investor NekoZ believes that the market is now entering the second phase of a four-phase cycle.

The four-phase cycle of capital movement in the cryptocurrency market. Source: NekoZ

"ETH has started to outperform BTC in terms of returns, which means we have entered the second phase of the altcoin season," said NekoZ.

In this context:

• Phase 1: Bitcoin exceeds expectations.
• Phase 2: Ethereum surpasses Bitcoin.
• In the third stage, there is a growth of altcoins with large market capitalization.
• Phase 4 is the period of rapid growth of altcoins and meme coins with low market capitalization, which often serves as a signal for the final stage of the altcoin season.

Many observers are closely following this development.

The last factor to consider is Bitcoin's dominance (BTC.D). In July, BTC.D dropped from 65.5% to 61%, marking the largest monthly decline since November 2024. Analysts, examining trends from previous cycles, believe that the altcoin season may continue until the share of BTC.D falls to 48–50%.

Bitcoin dominance. Source: ToraX

Every investor likely has their own strategy. However, historical experience shows that holding altcoins for too long often leads to losses, unlike Bitcoin, which tends to recover better. As the market overheats, the risks increase even more.

Conclusion

The dynamics of the altcoin season are evident: there is a strong growth in market capitalization and a decrease in Bitcoin's dominance. Investors should closely monitor the altcoin season index, the dynamics of TOTAL3, and the phases of capital movement to optimize their exit timing. Recognizing these signals can help reduce risks and secure profits before potential market corrections. Attention and discipline remain key factors in managing this dynamic cryptocurrency cycle.

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