Only 24% of Altcoins Are Above Their 200-Day SMA

Low altcoin SMA penetration indicates buyers could capitalize on undervalued altcoins before the next crypto boom.

Only 24% of Binance-listed altcoins are currently trading above their 200-day simple moving average (SMA), according to the latest findings by Alphractal founder Joao Wedson.

Far from being euphoric, the altcoin market is now presenting rare opportunities for accumulation.

Accumulation Opportunity

Historically, when nearly all altcoins exceed this level, markets are in a state of euphoria, and often coincide with Bitcoin cycle peaks.

On the other hand, when the metric nears zero, it signals strong accumulation opportunities as most altcoins trade below their long-term average. With just under a quarter of altcoins above the 200-day SMA, Wedson explained that the market is far from euphoric. Such a scenario may present an attractive window for investors to accumulate altcoins ahead of the next potential rally.

The latest development comes after a week of intense volatility that triggered massive declines in several top assets. Currently, Bitcoin is showing signs of a significant breakout from its recent accumulation range as it reclaimed $112K. This uptick indicates that market strength is rotating back to Bitcoin and marks a BTC-led phase, but the implications lie beyond the top crypto itself.

While this is not a full-scale bull run, Altcoin Vector said that it represents a crucial stabilization, especially after last week’s flushed leveraged positions, which cleared the path for healthier recoveries. As the “oxygen” of the crypto market, Bitcoin’s movements directly influence altcoins. As such, if BTC moves too strongly, altcoins lag; too weak, and they fade.

A stable Bitcoin, however, provides the environment necessary for altseason to thrive. The market now appears set for a reset phase with two potential paths: either BTC remains stable, which is expected to allow altcoins to rotate and strengthen toward year-end, or BTC dominance continues to rise as alts capitulate. Early evidence favors the former scenario for Q4.

You may also like:

Biggest Altcoin Season Is Near?

A similar sentiment was echoed by DeFi researcher 0xNobler, who predicted that the biggest Altcoin Season in history is set to kick off this October. According to him, this is a critical phase where low-cap altcoins have the potential to surge 200-250x, turning a modest $50 investment today into $50,000 by the end of Q4.

Drawing parallels to the 2021 bull run, 0xNobler added that the current setup mirrors that historic cycle, which makes the current setup the optimal time to buy undervalued altcoins before the anticipated major rally begins.