Altcoin Season In Breakout Mode as Bitcoin Dominance Hits Major Top

Altcoin season is now in the spotlight amid a changing market outlook. On September 22, crypto trader Ted Pillows said many people are stuck in altcoins as Ethereum’s rally slows.

As of writing, Bitcoin remains flat, and Ethereum is trading lower, as mixed sentiments trail the incoming altcoin cycle.

Altcoin Season Rotation Slows and Traders React

Crypto trader Ted Pillows said this week that many investors are trapped in altcoins.

He explained that people moved into smaller coins after Ethereum’s rally, but the gains have not lasted.

One community member replied that bulls cannot be broken and warned that selling now could lead to regret in November or December.

Pillows agreed, saying that selling too early often proves costly. Another trader, czamy2023, said patience was the right approach and predicted Ethereum would still rise.

Pillows added that patience with Ethereum has usually worked out in the past. In addition, CryptoQuant released a report saying the altcoin cycle rotation may be nearing its end.

Per the update, Bitcoin has been trading in a sideways range for two months, which gave Ethereum room to climb earlier.

Notably, Ethereum’s trading volume dominance fell after that rally, and activity shifted into smaller tokens.

The analysis also revealed an increase in Ethereum withdrawals, a sign that investors are less confident.

In June, the same data showed little change, which was why a major correction was not expected then.

However, the pattern has lasted longer than forecast, and the trend is clearer. Bitcoin itself has not shown much strength either.

CryptoQuant said that a reversal could follow if interest rates are cut, but there are no signs of that yet. The report urged traders to stay calm and cautious.

Meanwhile, not everyone agrees with the bearish altcoin outlook. CryptoELLTES said on X that charts signal a new altcoin season, with possible targets of $10,000 for Ethereum and $190,000 for Bitcoin.

Ethereum Under Pressure at Key Levels

Ethereum has been under pressure after its earlier gains. As of writing, the coin traded at $4,191.57, down more than 6% in 24 hours and over 7% for the week.

It has dropped below its 20-day moving average, a sign of short-term weakness.

Likewise, technical signals confirm the slide. Momentum and the MACD are in sell territory. The relative strength index is near 40, close to oversold but not yet extreme.

Bollinger Bands show the price testing the lower band at about $4,160. The first support level is $4,150; if that breaks, the next target could be $3,800.

For Ethereum to recover, it needs to move back above $4,400. A break above $4,500 could open the path to $4,700.

Until then, Ethereum’s market position looks weaker than it did earlier in the year.

Ethereum’s share of overall trading has also dropped. As more activity shifts into smaller tokens, Ethereum’s dominance continues to fall, reducing its influence on the wider market.

Bitcoin, Top Coins, and Market Mood

Across the wider market, the picture is mixed. Bitcoin price was trading at $112,927.61, down 2.43% in 24 hours, with a market value above $2.24 trillion.

Ethereum follows at $4,191.57. Tether holds steady at $1.00 with a market cap of $172.15 billion. XRP is priced at $2.81, down 5.49%.

BNB trades at $1,020.73, down 3.43% in 24 hours but still up 10.71% for the week.

Overall market measures show more signs of caution. The total crypto market cap stands at $3.89 trillion, down 3.66% on the day.

Still, the CMC20 index, which tracks the biggest coins outside Bitcoin, is $247.06, down 3.62%.

This shows that losses are spread across the board, not only in Bitcoin and Ethereum.

The Altcoin Index sits at 63 out of 100, meaning smaller coins still make up a large share of activity.

Additionally, the Fear and Greed Index is pegged at 47, which reflects neutral sentiment with a tilt toward caution.

For now, the focus is whether Bitcoin can break its range and whether Ethereum can recover support.

Until then, the altcoin cycle that boosted smaller coins is under mixed pressures, leaving many investors locked in positions