When Altcoins Hit Rock Bottom: The Setup Before the Next Wave

The altcoin market just witnessed a brutal correction that wiped out three consecutive days of momentum in a single trading session. It’s a painful sight for holders, but here’s the thing—this kind of volatility often serves one key purpose: shaking out weak hands and resetting the market for the next leg up.

What’s particularly telling is how BTC and ETH are holding their ground. Despite the carnage in smaller caps, these two heavyweights have barely budged, suggesting they’ve found strong support levels. They’re not collapsing; they’re consolidating. And that consolidation at elevated levels sends a clear signal: the market infrastructure remains intact, even as fear spreads through the altcoin ecosystem.

This distinction matters. When Bitcoin and Ethereum can weather the storm without breaking key support, it typically indicates they’re gathering strength rather than losing it. Meanwhile, altcoins are experiencing what could be their final capitulation phase. These cycles are predictable—panic, liquidation, then a violent rebound once the bottom is in.

The playbook from here is straightforward. Once altcoins finish their purge and stabilize, the capital that has been sitting on the sidelines will flow back in. When it does, don’t expect modest gains—historically, altcoins move with extreme velocity once risk appetite returns. The move likely pulls in the major coins too, creating the synchronized rally everyone’s been waiting for.

If the thesis holds, we might be staring down the barrel of the alt season that narratives have promised. The precondition is simple: watch for the moment when selling pressure exhausts itself. That’s your signal.