Bitcoin (BTC) price is climbing above the much-anticipated $90,000 mark, while Ethereum (ETH), XRP (XRP), Solana (SOL), and Dogecoin (DOGE) are following suit; however, analysts emphasize that the main trend is still downward and it may be too early for a classic altcoin season.
Following a sharp sell-off over the weekend, the cryptocurrency market began the new week with a strong recovery. Bitcoin settled back into the $89,000-$92,000 range, while investors’ expectations of a Fed interest rate cut in December fueled buying in both stocks and crypto assets. In the last 24 hours, BTC rose approximately 3.9%, while Ethereum gained 3.4%, XRP gained over 1%, and Solana and Dogecoin gained around 2%.
Data suggests that the backdrop for this surge is the liquidation of short positions. A total of $365 million worth of positions were liquidated in the last 24 hours, approximately $255 million of which were short-held. According to Binance data, approximately 70% of open BTC positions remain long. Meanwhile, rather than confirming the market rally, the Crypto Fear & Greed Index remains in the “extreme fear” zone, suggesting the rally could be fragile.
Overall, the global crypto market capitalization increased by over 2.5% in the last 24 hours, reaching approximately $3.03 trillion. Among the day’s fastest-rising altcoins were relatively small-cap projects like Rain (RAIN) and Fartcoin (FARTCOIN), while more established projects like Helium (HNT) also saw a surge of over 20%. This chart suggests a strong buying reaction in select altcoins, but a market-wide rally hasn’t yet begun.
It may be too early for altcoin season
On-chain and derivatives data suggest that Bitcoin’s rally may remain largely in the “relief rally” category for now. CryptoQuant notes that Bitcoin open interest has experienced one of its sharpest declines of the cycle in the last 30 days, a “clean-up phase” typically seen in the past with bottom formations. While such periods are often followed by the start of a new bull run, historically, Bitcoin has stabilized first, followed by a gradual influx of capital into Ethereum and major altcoins, and finally into riskier projects.
Bitcoin has recovered from the bottom around $85,550 and returned to the $87,000-88,000 range, while its 25-delta skew, previously sharply lower at -10.96, has recovered to -4.5, suggesting a decline in demand for excessive downside protection. There has also been an increase in long call condor strategies at strike prices above $100,000, suggesting that major players are repositioning for bullish scenarios through the end of 2025.
The $91,000 and $85,000-$86,000 bands are critical for Bitcoin.
Popular analyst Michaël van de Poppe points out that despite the recent surge, Bitcoin is still in a short-term downtrend. He says $91,000 is the first significant resistance area, and the price is likely to consolidate there and retest the $85,000-$86,000 range. A healthy performance in this area could pave the way for the next strong upward wave.
In summary, many altcoins, especially major ones, have been positively impacted by Bitcoin’s recent surge; however, both sentiment indicators and analyst commentary suggest that this is not a full-blown altcoin season yet, but rather a strong reaction rally. A classic alt season requires a decline in market fear, a retreat from Bitcoin dominance, and, in particular, sustained strengthening in the ETH/BTC pair. For now, Bitcoin is still the dominant force; the real altcoin spectacle may be in the next act.
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