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▲ Altcoins
Altcoin trading volume has surpassed its annual average, once again raising the possibility of an altseason. Analysis suggests that capital circulation is accelerating as trading volume expands into altcoins excluding the top five assets: Bitcoin (BTC), Ethereum (ETH), Solana (SOL), XRP, and BNB.
NewsBTC reported on May 10 (local time) that the 30-day moving average of altcoin trading volume has exceeded its 365-day moving average, citing analysis from CryptoOnchain, a CryptoQuant contributor. CryptoOnchain explained that altcoin trading volume has recently entered an upward trend, based on the 'CEX Volume Ratio: Others vs Top 5' indicator.
This indicator shows how much altcoin trading volume, excluding the top five assets on centralized exchanges, is flowing in compared to the combined trading volume of the top five assets. A rise in this ratio means that traders are moving funds into small and medium-sized altcoins rather than large cryptocurrencies. NewsBTC interpreted this as a sign of recovering risk appetite and increasing possibility of an altcoin rally.
CryptoOnchain explained that similar signals in the past have confirmed a flow of capital from large assets to small and medium-sized altcoins. Especially during the 2021 bull market, this signal appeared repeatedly, followed by an explosive rally across the altcoin sector, and the price of Ethereum also rose significantly.
In recent charts, the purple volume ratio line has passed through a bearish phase and is gradually strengthening again. CryptoOnchain believes that if this ratio shows a breakout trend, a period of high volatility may precede it, and the possibility of an altcoin market rally could increase.
However, an increase in altcoin trading volume does not immediately confirm an altseason. CryptoOnchain analyzed that while it could be a sign of expanding interest from retail and institutional investors beyond the top five assets, Ethereum's price movement is crucial to confirm internal market trends.
He explained that if the increase in altcoin trading volume is sustained and Ethereum's price remains stable or shows an upward trend, it could be a strong confirmation signal that a broader altcoin rally is underway. NewsBTC reported that Ethereum was trading at $2,329 at the time of writing, up 1% over 24 hours.
The core of this analysis is that altcoin trading volume has surpassed the annual baseline. If the trend of trading volume spreading beyond the top five assets continues and Ethereum maintains stable movement, the market could begin to fully price in the possibility of entering an altseason again.
*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*
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