Why Analysts Are Optimistic About Altcoins Entering the End of the Bear Market

Despite a challenging landscape for altcoin investors, with many potentially closing 2025 without profits, analysts are showing optimism. The altcoin market capitalization (TOTAL2) has decreased by 30% from its peak this year, but several key factors suggest this bear market may soon reach its conclusion.

Key Takeaways

Only about 3% of altcoins on Binance currently trade above their 200-day moving average, indicating a significant undervaluation.
Many analysts believe the ongoing fear and lack of retail investor interest could provide unique opportunities for larger investors.
Key technical indicators are suggesting that the altcoin bear market might be nearing its end, with strong support levels identified.
Historical patterns indicate that periods of low interest often precede price recoveries.

Analyzing the Current State of Altcoins

Opportunities in the Altcoin Market

Currently, data from CryptoQuant reveals that only around 3% of altcoins listed on Binance are trading above their 200-day moving average, which is an all-time low. CryptoQuant analyst Darkfost highlights that this situation stems from reduced liquidity and a defensive attitude among investors. Many are now focusing on preserving their capital rather than investing in riskier assets.

Percentage of Binance Altcoins Above or Below the 200-Day SMA. Source: CryptoQuant

This prevalent undervaluation of altcoins is reflected in their trading prices, which remain significantly lower than long-term averages due to widespread negative sentiment. Analysis from BeInCrypto suggests that coins like XRP, TON, and ADA continue to show strong fundamentals, but their prices have not bounced back.

Darkfost mentions that historically, such low points often present excellent opportunities for patient investors. “While it might appear counterintuitive, these phases frequently offer the best investment prospects. This current phase could last for a while, particularly if we enter a more extended bear market,” he remarked.

The Role of Retail Investor Interest

Fear and disinterest from retail investors often facilitate advantageous pricing conditions in the market. Large investors, recognizing this, tend to accumulate assets during these low-interest periods. Notable analyst CrediBULL Crypto points out that this phenomenon can serve as a signal for identifying market bottoms.

In a recent tweet, CrediBULL emphasized that it’s not capital but rather attention that is scarce. He stated, "The key driver of attention is witnessing rapid price increases." When retail investors withdraw their interest, larger players typically step in to make purchases. As early signs of price recovery (or green candles) emerge, retail interest gradually returns and fuels the next market phase.

Technical Indicators Signaling a Bottom

Multiple technical indicators indicate that the altcoin bear market may be nearing its conclusion. Market analyst Michaël van de Poppe mentioned that the current levels of altcoin market capitalization could act as strong support, referring to these levels as an “area to hold.”

Altcoins Market Cap Excluding BTC and ETH. Source: Michaël van de Poppe

Michaël van de Poppe stated, “We seem to be at a critical support level. Remaining invested at this level appears to be worthwhile, and solid bounces might lead to green candles here.”

These bullish indicators suggest that altcoins could be in their final decline stages. Accordingly, recent analyses from BeInCrypto recommend that a Dollar-Cost Averaging (DCA) strategy could yield positive results if initiated from December.

However, it’s important to note that some analysts continue to express caution, warning that a significant altcoin season may not materialize even by 2026. Venture capital investments remain low, and market sentiment could take time to fully recover.