Recently, the uncertainty in the cryptocurrency market has started to get exciting as Bitcoin dominance looks like it may drop further from here.

If Bitcoin dominance continues its downtrend, this shows that the spread between altcoin and Bitcoin prices is beginning to change, and I want to observe that trend change.

Recently, I did some deep technical analysis on a set of cryptocurrencies that were highlighted by the alt-season co-pilot spreadsheet. It's a random selection of coins to start a benchmark of journaling the potential beginning of an altcoin season in September of 2023.

There were five short videos in the research released over the weekend:

Litecoin

DEGO

Santos

Sol

High Street metaverse token.

Is it really Altcoin Season? Now?

While each of these charts may be flashing a potential alert signal or a buy signal according to our altcoin season indicator, a closer inspection makes it clear that each coin must be reviewed on its own merit and its own risk management conditions.

There is no way to know the future, and with my limited knowledge, there's no way for me to know which of these coins is going to be the one to make the big move.

So, I rely on our trading plan, and I use a unique filter of narrowing my selection based on how the coins have performed through potential altcoin seasons in the last 2 years. I can eliminate a group of chart patterns that don't look like they have established investorship supporting the project.

I can never know the fundamentals behind the chart pattern, but I really don't need to. The most important part of my trading plan is the risk management components. The better I do at managing my position sizes at the beginning of the trade, and the better I do at letting go of coins that do not prove me correct, the more successful I've been.

When I don't follow my risk control rules, I definitely lose more money than I should have, no matter what my entry and exit signals might say.

Staying prepared for altcoin season: 

Given that I don't know the future and that I don't know which coin is going to take off, I must stay prepared. I must control risk by starting with very tiny positions across a diversified portfolio whenever the coins give me the signal.

As time moves along, I continually readjust the portfolio based on the trading plan and the risk management rules, so that my investment capital is focused in one of three pools:

1. Our general trading rules say that we should be in cash if the bitcoin price is dropping and Bitcoin dominance is rising. Our written trading plan establishes a threshold where the cross of the 60 bar and 20 bar exponential moving average on the 4-Hour and the 12-hour timeframe becomes our major action signal for holding Bitcoin or for holding cash.

2. A second generic rule for our system says that we should be holding Bitcoin if bitcoin price is rising and Bitcoin dominance is rising.

3. The third generic rule of our system says that we should be looking to build a diversified portfolio of cryptocurrencies if Bitcoin dominance is dropping.

Worst case scenario: 

Cryptocurrency holders in the various ranges of altcoins will experience the worst US dollar depreciation of their assets if we witness Bitcoin prices dropping while Bitcoin dominance is rising. It's essential to follow our risk control rules and move our equity into the pool that is best suited for the conditions of the market.

Cryptocurrency enthusiasm in its place: 

I believe cryptocurrency technology will transform business because it does serve a purpose efficiently. At the same time, the face value of the trading price will change based on the world's economy more than just the validity of the technology. In other words, there have been times where the world's economy is sluggish, and Bitcoin prices dropped at the same time as other equities' values such as gold and the stock market.

I'm super enthusiastic about the future of cryptocurrency and the potential for an extended bullish market, in its proper time.

That means

1. I must stay vigilant to the 123 bottom formations and continue tracking the spreadsheet of which coins are at the front edge and could be the potentials for a breakout.

2. I must stay ready to risk a very tiny bit of my portfolio into a diversified group of coins and then manage my risk.

I believe in the small trader.

I started out from nothing and built myself up to an amazing year of profits in 2017. I did it with pre-planning, I did it intentionally, and I could have done it a whole lot better. Since then, I've been preparing for whenever the next cryptocurrency bull market is setting up so that I can take advantage of it.

There's no hurry for it, and there's no pushing it to become faster.

All we can do is continue to be prepared and recognize that we have the opportunity to use this very same trading plan across every different market there is, and not just cryptocurrency.

My job is to trade the pattern, not the market.

So, I look for markets that are giving me my pattern, and I look to see where I can establish my first position while managing my risk.

☄ Disclaimer, I’ve been trading on SimpleFX since 2015. I am an affiliate, and I earn a small percentage from your trading fees if you sign up and become active through my referral link.

🛆 Risk Disclaimer 🛆 
You should not invest money that you cannot afford to lose. Seek advice from a certified independent financial adviser if you have any doubts. There is considerable risk in bitcoin, altcoin or world market trading, and may not be suitable for all investors.

When addressing financial matters in any of our books, sites, videos, newsletters or other content, we’ve taken every effort to ensure we accurately represent our strategies and services and their ability to improve your trading or grow your portfolio.

However, there is no guarantee that you will get any results or earn any profit using any of our ideas, tools, strategies or recommendations, and we do not purport any ‘get rich schemes’ in any of our content.
Nothing in our training products are a promise or guarantee of earnings.
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Trade safe and keep those losses small.

Doug