"Altseason," a term familiar to many crypto traders, refers to periods when altcoins significantly outperform major cryptocurrencies like Bitcoin and Ethereum.

In the ever-evolving landscape of cryptocurrency, "altseason" represents a pivotal phenomenon where altcoins significantly outperform major cryptocurrencies like Bitcoin and Ethereum. This article delves into the historical patterns of altseason, exploring its implications for investors and the broader market dynamics. By analyzing previous cycles, we uncover the factors that typically trigger these explosive periods of growth, as well as the current market conditions that may signal the next altseason. Understanding these nuances is essential for both seasoned traders and newcomers seeking to navigate the complexities of crypto investing.

Understanding Altseason: What It Is and Why It Matters

"Altseason," a term familiar to many crypto traders, refers to periods when 

 significantly outperform major cryptocurrencies like Bitcoin and Ethereum. Historically, these phases have been characterized by capital rotation from Bitcoin into smaller, riskier projects, often leading to explosive growth in altcoin prices. This phenomenon has been evident in the past three major bull runs, notably in 2017 and 2021, when altcoins surged in value after Bitcoin reached new all-time highs (ATHs).

Bitcoin’s price movements have been cyclical since its inception in 2009. By analyzing historical price data, we can identify distinct periods of boom, bust and recovery. Notably, the two most recent bull runs have witnessed pronounced altseason events, whereby altcoins recorded extraordinary gains, often multiplying their market caps significantly.

For instance, during previous altseasons, the total market capitalization of altcoins surged between 6x and 7x. This explosive growth not only provided immense profit opportunities for traders, but also underscored the 

 inherent in the cryptocurrency space. However, one must also recognize that altseason often precedes the end of a bull run, as profit taking from large-cap tokens leads to a market correction.

Despite the historical significance of altseason, the current cycle appears markedly different. Bitcoin has continued to reach new highs while maintaining a strong market dominance, contrary to the typical pattern in which 

 declines during altseason. This deviation raises critical questions about the nature of the current market, and whether a traditional altseason is imminent.

The Current Landscape: Indicators and Influences

Several factors contribute to the unique dynamics of the current crypto market. First, it’s informative to underscore the importance of Bitcoin’s halving events, which historically precede significant market capitalization and dominance shifts. In previous cycles, Bitcoin's dominance tended to decline approximately 230 days post-halving, leading to a capital rotation into altcoins. However, the recent halving in April 2024 didn’t trigger the expected decline in Bitcoin dominance, suggesting a potential structural change in market behavior.

Moreover, the performance of Ethereum (ETH) relative to Bitcoin has also shifted. Historically, Ethereum served as a primary beneficiary during altseason, often experiencing substantial gains as traders rotated out of Bitcoin. However, since 2022, Ethereum has underperformed not only Bitcoin but also several competing "Ethereum Killers," such as Solana (SOL) and Sui (SUI. This relative underperformance has raised doubts about Ethereum's capacity to lead the market into a new altseason.

 has further complicated the landscape. While the introduction of these ETFs has driven Bitcoin’s price to new heights, it’s also resulted in a capital flow that remains largely focused on Bitcoin and Ethereum. Many institutional investors appear hesitant to rotate their capital into smaller, more speculative altcoins, opting instead to remain in regulated ETF products.

Last but not least, there’s been a significant increase in 

 supply, which has risen by 66% since the start of 2024. This indicates that while institutional activity may explain some market movements, retail engagement remains robust. 

 (CEXs) recorded their largest trade volumes in Q4 2024, suggesting that retail traders are actively participating in the market, potentially looking for altcoin opportunities as liquidity increases.

What Lies Ahead: Potential Scenarios for Altseason

Given the current market dynamics, traders are left to ponder whether an altseason is on the horizon and what form it might take. The accompanying report presents several scenarios that could influence the emergence and nature of the next altseason:

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Bybit x Block Scholes Institution Report: Altcoin Rotation — Why Altseason Hasn’t Come This Time?

Feb 10, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

 explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly Highlight — Mixed Job Reports Rattle Market

The recent Bureau of Labor Statistics report indicates that U.S. job growth is slowing, yet remains healthy. Nonfarm payrolls grew by 143,000 last month, with upward revisions for November and December 2024, as they added 100,000 jobs. The unemployment rate has dipped to 4.0%, demonstrating a robust labor market, although the annual revisions suggest job gains were softer than initially reported, averaging 166,000 per month in 2024.

Simultaneously, inflation expectations are rising, driven partly by tariffs proposed by U.S. president Trump. Data from the University of Michigan reveals consumers anticipate price increases, which may complicate the Federal Reserve's decision-making. Fed officials have indicated they aren’t in a rush to lower interest rates further after a series of cuts last year, suggesting they prefer to observe how the economy reacts to potential policy changes.

The job growth in January 2025 was primarily concentrated in health care, retail and government sectors, while mining and manufacturing faced declines. Severe weather conditions contributed to nearly 600,000 people missing work, the highest impact in four years.

Despite these fluctuations, hourly wages increased by 0.5% month-over-month and 4.1% year-over-year, reflecting pressure on wages amid labor market tightness. The participation rate in the labor force stands at 62.6%, with notable contributions from foreign-born workers, highlighting immigration as a critical factor in employment growth.

As the Fed assesses the stability of the labor market, upcoming directives from the Trump administration, including potential immigration restrictions, could impact future job growth and economic conditions. While the landscape shows signs of moderation, it remains resilient, with cautious optimism surrounding economic stability.

Weekly Crypto Highlight — Crypto IPOs Coming

As reported, Gemini, the cryptocurrency firm founded by the Winklevoss twins, is potentially exploring an 

 (IPO) this year. The company is currently discussing the listing with potential advisers, although no final decisions have yet been made.

Bullish Global, a crypto exchange operator whose backers include billionaire Peter Thiel, is considering an IPO as soon as this year.

The interest in going public comes amid a surge of crypto firms accelerating their IPO plans since President Trump's election, as he has shown support for the industry. The Winklevoss twins, known for their legal battles with Facebook's Mark Zuckerberg, previously donated Bitcoin exceeding the campaign contribution limit to Trump, later receiving a refund for the excess.

Gemini employs over 500 people across several global locations, including New York, Seattle and London. Recently, the firm agreed to pay $5 million to settle a Commodity Futures Trading Commission (CFTC) lawsuit alleging it misled regulators while trying to launch the first U.S.-regulated Bitcoin futures contract. Additionally, Gemini has committed to returning at least $1.1 billion to customers affected by the Genesis Global Capital bankruptcy as part of a settlement with New York regulators relating to its Gemini Earn program.

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Weekly Institutional Insights: Mixed U.S. Job Reports; Crypto IPOs Coming

In our latest Learn 101 livestream session, crypto experts shared insights on Bybit Copy Trading Gold&FX.

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 provides a recap of our Learn 101 livestreams, offering you comprehensive expertise and insights from leading figures in the crypto industry in case you miss the livestream.

Joining the livestream on Feb 6, 2025 were two distinguished guests: Argiris Sotirakis, professional trader and founder of 

, and Eric Li, Financial Product Manager at Bybit. Under the moderation of Sabrina Chua, Crypto Evangelist and SEO Editor at Bybit, this episode explores Copy Trading Gold&FX Mastery.

Copy Trading 101 — Is It Really That Easy?

Copy trading offers a unique opportunity for investors to potentially outperform the market without dedicating countless hours to analyzing charts. Eric Li, an expert in the field, explains that copy trading involves mirroring the trades of seasoned professionals. 

During his presentation in this Learn 101 livestream, he shares his screen to showcase Bybit’s 

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 allows you to follow traders specializing in non-crypto assets like gold and forex. To access any of these features, users must first create a separate Copy Trading account on Bybit.

One standout feature of Bybit’s platform is its high-water mark system, which ensures that profits are shared fairly based on individual investments. This transparent approach aligns the interests of both the Master Traders and their Followers.

Argiris emphasizes that copy traders should experience results similar to those of their chosen Master Traders, provided they mirror trades simultaneously. However, he advises against putting all your eggs in one basket. “Diversification,” he says, “is key to minimizing risk and exposure to losses.”

Unlike platforms that rely on fiat currency, Bybit’s Copy Trading Gold&FX uses 

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When it comes to selecting a trader to follow, Argiris Sotirakis cautions against relying solely on win rates. “A high win rate can be misleading,” he notes. Instead, he recommends evaluating a trader’s performance over time to understand how their strategies perform under different market conditions. He views copy trading as a long-term strategy, pointing out that it may take more than a month to see meaningful results — especially since various strategies thrive in different environments, such as trending markets versus sideways markets.

Eric Li further explains that Bybit offers tools to help users explore various strategy types employed by trading leaders. There are four primary strategy categories, each one focusing on distinct metrics and trading styles. For beginning traders, there’s even a strategy specifically designed to ease them into the world of copy trading. Additionally, traders can search for leaders based on the market they operate in, whether crypto, gold or forex.

One common misconception about copy trading is the perceived loss of control over your assets. Eric Li addresses this concern by highlighting several 

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Gold & Forex Trading: The Secret Sauce Pros Don’t Share

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To help traders get started, Eric Li demonstrates Bybit’s Gold&FX Trading platform, highlighting its 

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The minimum investment to join Bybit Copy Trading Gold&FX is 100 USDT, though some Master Traders may require a higher amount. Choosing a Master Trader whose trading style aligns with your risk tolerance is essential.

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Candlestick

Trading

Morning star pattern is a bullish reversal pattern that tells you buyers are dominating the market. Thus, an uptrend is coming. But how to spot them? Learn more here.

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 that works well in every financial market as a typical bullish pattern. Most price action traders use this pattern to identify the potential buying point of a trading instrument. 

Candlestick trading is commonly used in the cryptocurrency market; not only it helps traders to assess the market trends, but the implementation of modern candlestick charting on most trading platforms also makes them extremely accessible. Still, the cryptocurrency market is new and still emerging, compared to the traditional forex (FX) or stock markets, where investors face a lack of sufficient previous data important for using candlestick analysis. However, for most of the top-tier crypto coins, there is a fair amount of historical data available so that you can easily apply candlestick analysis to it. 

The morning star candlestick is usually used for 

 as it provides similar price action to other formations, such as 

Without further ado, let’s get down to the nuts and bolts of the morning star pattern in the cryptocurrency market.

What Is the Morning Star Candlestick Pattern?

A morning star pattern is a bullish reversal pattern that appears at the bottom of a downtrend. It indicates that sellers have lost their momentum, and buyers have taken control over the price in an uptrend.

It is a combination of multiple candlesticks with a U-shape, indicating a shift in the trend direction. This pattern is very effective when the price moves down for a considerable time, but a reversal of momentum seems at hand. 

The morning star candlestick pattern is a combination of three candles with the following characteristics:

The image represents what the morning star pattern looks like.

Usually, the ideal morning star reversal pattern develops at a significant support level or at the bottom of a downtrend, which provides the maximum accuracy for going long. This is because the financial market moves like a zigzag by creating swing lows and swing highs. 

Whenever the price moves back from the swing level, it leaves some signs that the prevailing trend is about to end and a new trend is about to start. The same theory applies to the morning star pattern. 

This pattern represents a story about the market in which buyers remain active in the price on Day 1. On Day 2, the price opens with a downward gap, indicating that sellers are still active and aggressive. However, the sellers barely make a new low at the end of the day, pointing out that they’re losing momentum. This is the primary sign of an upcoming morning star pattern. A strong bullish candle appears on the third candle, eliminating the bearish price action of Day 2.

The formation of the morning star pattern.


The above image shows the exact formation of the morning star pattern in the price chart. Day 3 opens with a bullish cap and closes higher above Day 2. Some common aspects of this pattern are as follows:

How to Identify a Morning Star on Crypto Charts

In the above section, we’ve seen how the morning star pattern develops within three days. Now let’s move to identify this pattern in any financial market.

Identify the Bottom (Ending of a Bearish Trend)

At first, you have to find a bearish trend that’s easy to spot on the chart by observing lower lows in the price. However, finding the bottom is essential. In this case, the bottom means the last part of the bearish trend from which bulls may regain momentum.

You can define the bottom using horizontal or dynamic support. You don’t have to wait for confirmation from the support level. Instead, start monitoring the price as soon as it reaches the support level.

The above image shows the price moving downward (downtrend) and reaching a horizontal support level. We can therefore say that the price may have found a bottom. Moreover, you can use dynamic support like 20 EMA to identify the bottom. If the gap between the dynamic 20 EMA and price extends, the price has a higher possibility of making a bottom and then reversing.

As soon as the price reaches the bottom, we should find three candles as discussed in the above section. Here the second candle should be smaller than the first candle and should open with a bearish gap. However, the gap is not mandatory. This is because, in some cases, the price may open without a gap due to less volatility in it.

If the second candle’s body remains within 50% of the first candle’s body, we can consider the pattern to be valid. But the most important part of all is the third candle.

The third candle should appear with an impulsive bullish pressure, eliminating the price action of the second candle. We can define the probability of the trade by looking at the third candle as follows:

When three candles appear with these conditions, we can consider the pattern to be valid.

How to Spot Bullish Reversal Pattern Using the Morning Star

This section discusses the strategy to identify the morning star pattern in the cryptocurrency market using a real chart. 

Previously, we’ve seen that the morning star is a bullish pattern that appears after a strong bearish trend. Therefore, at first, you have to find a selling market that moves down for a considerable time:

The above image is a BTCUSD daily chart in which the price moves down from $62,000 to the $51,912 event level, with a bearish pressure. First, however, look at the daily bearish candle that hits the event level. It’s smaller than the previous candle and opens with a gap. 

Here we can see a strong bullish daily candle that eliminates the previous day’s selling pressure and closes the candle above Day 1’s high. If we compare the last 3 days’ candle formation with the conditions for the morning star pattern, we see that they’ve matched. 

Look at the image below to see what happens next:

We can see that the price moves higher from the morning star pattern, ultimately breaking above the previous swing high. 

Next, we’ll look at how we can open a buy trade using the morning star pattern. 

The aggressive approach is opening a buy-stop order above the third candle’s high, with some buffer. Here, the third candle indicates that buyers have entered the market by eliminating all the selling pressure. Now buyers are ready to take the price higher by creating new and higher highs. Therefore, putting a buy-stop order will automate the entry once the price moves higher on the next day. In that case, the ideal stop loss will be below the second candle’s low, with some buffer.

The above image shows how the buy-stop order works, providing a 1:1.8 risk-to-reward-based profit. 

Another approach is the conservative one, in which traders wait for a correction before opening the buy trade. In that case, they can open a buy trade from a 30% or 50% correction of the third candle’s body instead of buying from the candle’s high. 

The conservative approach has a better risk-to-reward ratio than the aggressive approach, but there is a possibility of missing out on the trade. In addition, there’s no guarantee that the price will correct lower after forming the morning star pattern. Therefore, the optimum approach is opening the 50% position with the aggressive approach and another 50% position with the conservative approach.

Morning Star vs. Evening Star: The Differences

The evening star is another similar technical indicator but signals bearish reversal momentum. The evening star forms at the top of a price uptrend, signifying that the uptrend is nearing its end where the potential reversal (bearish sign) is approaching. The key highlight to the evening star is the ideal pattern rarely appears in technical analysis. If it does, the signal is usually reliable, and a strong downtrend is on the way.

We’ve illustrated the evening star pattern in the image below.

The evening star pattern is a combination of three candlesticks with the following characteristics:

Now let’s move to the key differences between the morning star and evening star candlestick patterns: 

How Reliable Is the Morning Star Pattern?

Morning star is a powerful candlestick pattern, and most price action traders use it in their trading strategies. However, in financial trading, no pattern can guarantee you a 100% profit. Nevertheless, this pattern is very effective from the bottom, and it represents a story about the market regarding buyers’ failure and sellers’ presence. As a result, traders can easily understand what’s happening in the market — and make an informed guess as to what may happen next. 

Moreover, its reliability depends on how candles are forming. If the third candle eliminates the price action of the first and second candles by engulfing the price action, we can consider the buying possibility to be strong. 

However, the morning star pattern has a lower possibility of working out from a random place because there is no way to say that the current trend has weakened. Therefore, the morning star success rate depends on the price trend, levels, candle formation, and 

. Therefore, traders should consider other factors besides the candlestick pattern to increase its probability of success. 

Even if you have a maximum probability of trading, there is a possibility of failure in using this pattern. Therefore, make sure to follow a risk management system and always use stop loss in every trade.

Like other candlestick patterns, the morning star has some limitations. Let’s have a look at them:

A valid morning star pattern is one of the most reliable 

 indicating a bullish reversal after a long bearish trend. Although this pattern is very effective, traders should do extensive research and practice in a demo account to test the pattern’s effectiveness. Another thing that a trader may consider is the risk associated with the financial market. 

Since the cryptocurrency market is very volatile, with the possibility of uncertainty at any time. A 

 and a strong upward and downward trend can happen in a split second. Therefore, always stay discipline with your risk management strategy as even the most perfect candlestick formation can’t predict the future. For a best result, always confirm the chart patterns with the trading volume other technical indicators like the 

Candlestick Patterns Professional Traders Use

 – A curated list of candlestick patterns most frequently used by traders

 – Learn the basics of candlestick patterns

 (Chart basics: trend, neckline, wedges)

Morning Star Pattern: How to Identify a Bullish Reversal in Crypto

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