- A new year alt season has got underway, with ETH breaking $1,000 and all alts benefiting
- The move was possible thanks to BTC’s massive 48-hour move to $34,800
- This alt season could be a shallow, short one of the current trend holds
Ethereum broke over the big even of $1,000 last night following a sensational start to 2021 in a sign that a monster alt season could be upon us following Bitcoin’s lung busting move. Having topped out at $34,800, Bitcoin’s cooling off led to the entire alt market enjoying a massive pump that has the potential to last for a few weeks at least.
Bitcoin Move Starts Alt Party
Bitcoin started the party with its mega move from $29,000 to $34,800 in a little over 48 hours beginning on January 1, a move that saw huge bitcoin outflows from Coinbase, including a single 35,000 BTC move, suggesting that institutional buyers were behind a large proportion of the move:
Another insane Coinbase outflow. 35k BTC. Institutions FOMO buying https://t.co/8pEBgTd9Jl
— Ki Young Ju 주기영 (@ki_young_ju) January 2, 2021
As Bitcoin chased $35,000, the ETH/BTC ratio retested the trendline that had held since January 2017. This retest resulted in a sensational bounce which took it convincingly above the upper trendline:
This show of strength illustrates that the mother of all alt seasons could just be getting started, an assertion that seems more likely than not after ETH rallied to $1,160 after BTC had topped out, a price last seen in January 2018. As a result it is only $232 off its all time high, which will likely come along in short order.
Bitcoin Dominance Charts Alt Season Course
Further evidence that an alt season is underway came through the Bitcoin dominance which broke through two previous resistance levels but couldn’t maintain it:
If this pattern plays out like past alt seasons we should see the Bitcoin dominance retrace the the trend line that was established in 2017, at which point Bitcoin will likely begin to regain its momentum:
As we have previously discussed, this alt season could be one of the shallowest and shortest yet, unless of course the trend is broken and Bitcoin dominance breaks this support line. Such an eventuality would lead to a 2017-style alt season.
It wasn’t just Ethereum that benefitted from Bitcoin topping out – almost all alt coins put in serious gains, with DOGE sparking the green day, followed by LRC, NANO, and CHSB who all put in performances that outshone ETH. Even XRP, which is getting delisted faster than ETH can climb, rose 10%.
Typically in an alt season the big caps move first, followed by medium and then low caps, and with ETH temporarily stalling after its huge move, it could be time for some smaller coins to put on a show – providing Bitcoin doesn’t make a violent move in either direction of course.