Following the recent surge in altcoin prices, talk of the start of the altseason is gaining momentum. Interestingly, the recent on-chain information about the volume of altcoin trading has added weight to the altseason discussion.
Altcoin Trading Volume Rises Above Annual Average
In a recent Quicktake post on the CryptoQuant platform, CryptoOnchain to be revealed a major change in the altcoin market. Citing the “CEX Volume Ratio: Others vs Top 5” metric, the market analyst explained that altcoin sales have been increasing recently.
The “CEX Volume Ratio: Others vs Top 5” metric tracks the volume of trading going into altcoins outside of the top 5, compared to the volume of the top 5. As such, it plays an important role in determining the level of investment and whether altcoins will start to gain momentum.
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According to CryptoOnchain, the 30-day movement of the altcoin trading volume is now higher than its 365 days. This trend, explained the researcher, shows that the volume of this small group is increasing.
Top CEX Volume Ratio Calculations: Others vs. The top 5 are indicators that traders are leaning towards smaller altcoins instead of cryptocurrencies (Bitcoin, Ethereum, Solana, XRP, and BNB). This, is interpreted as an increased risk, which can positively affect the altcoin rally.
The market analyst referred to historical data, noting that the periods when signals are highlighted often show short-term growth compared to the long-term. These cases have also shown a “fluctuation of funds from large groups to mid- and low-end altcoins.”
For example, during the 2021 bull season, these recurring groups signs corresponded to explosive meetings The exchange rate of altcoins in Ethereum is the basis of banks and their current exchange rates.
Notably, the chart shared by CryptoOnchain shows the purple line “Volume Ratio” gradually strengthening after the weakness. The analyst noted that the explosion of the ratio could lead to a period of high volatility, which could increase the chances of the altcoin market.
Ethereum’s Stability May Confirm Altcoin’s Velocity
CryptoOnchain also explained that the re-invigoration of the altcoin trading volume may be a sign that “trade and institutional interest is expanding beyond the top 5 stocks.” However, this does not mean that the trading news of the altcoin market.
According to crypto pundit, confirmation from Ethereum price change it may be necessary to observe the market performance.
CryptoOnchain explained:
If this rise continues and is accompanied by a stable or higher ETH price, it would be a strong confirmation that a major altcoin rally is underway.
As of press time, the price of Ethereum stands at $2,329, up 1% over the past 24 hours, according to CoinGecko data.
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Image taken from Shutterstock, chart from TradingView
