Where is Alt Season?

Key Takeaways

• Rising global liquidity, a weakening US dollar and crypto-friendly US policy
• Strong seasonality and indices at ATHs may boost an altcoin catch-up trade
• A BTC cup-and-handle chart pattern targets the $140k–$160k region

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Digital Asset Commentary

The bullish case for Bitcoin continues to strengthen. The biggest driver is the sharp expansion of global liquidity, now at multi-year highs, fueled by falling global interest rates and a weakening US dollar. In the US, several major developments are expected in Q3: Trump’s proposed tax cuts, dubbed the “big beautiful tax bill”, are likely to increase US debt; the GENIUS Act is set to provide stablecoin regulatory clarity by requiring full reserve backing, transparency, and audits for issuers, while also allowing banks to issue their own stablecoins; and the crypto task force led by David Sachs is expected to deliver a broader market structure framework for digital assets.

All of this occurs in the setting of historically bullish July seasonality for both traditional markets and Bitcoin. The S&P 500 and Nasdaq 100 have recently hit new all-time highs, fully rebounding from the April tariff-driven dip. Using the Russell 2000 as a proxy for potential altcoin strength, a catch-up trade in altcoins based on relative value to Bitcoin may emerge in the second half of the year. Like small-cap stocks, altcoins tend to perform best when interest rates are low and liquidity is abundant.

Meanwhile, Bitcoin is consolidating near its own all-time highs, forming a classic cup-and-handle pattern, marked by a rounded recovery followed by a smaller, downward-sloping pullback. A breakout from this setup could target the $140k–$160k range, based on the pattern’s depth. Notably, funding rates and CME futures Commitment of Traders (CoT) data still show a bearish bias among traders, hinting at explosive upside if shorts get squeezed.

Overall, Bitcoin and other digital assets remain an underowned asset class with strong tailwinds from liquidity, regulatory developments, a short squeeze setup just below all-time highs, and supportive price structures.