The monthly exchange flow of altcoins has fallen to an average of 1.6 billion dollars compared to an annual mean of 2.5 billion dollars. The most recent information at CryptoQuant, published by Axel Adler Jr., indicates we could be seeing a slowdown in the exchange activity that could signal the consolidation of the market and the possibility of accumulation of investors, as is seen before altseason rallies.
Historical Trends Show Precedent for Altcoin Rallies
The chart records average monthly inflow and outflow of all exchanged token (a total number of 73 tokens) and the price of bitcoin. It is worth noting that the previous instances when the price fell below the $1.6B floor, which can be viewed in green circles, led to subsequent altcoin price rallies. These dips were in early 2023 and the second half of 2023 and in the August-September 2024 window.
This has been a cyclical pattern that has attracted market analysts and every low-flow period has resulted in the altcoin space gaining momentum. As the current monthly flow remains less than the baseline of $1.6B once more, the same bullish speculation is gathering.
Current Flows Suggest Market Consolidation
The monthly flow, which is illustrated by orange bars on the chart, is way below the annual average (shown by a purple dashed line) of $2.5B. The resultant decreasing volume is usually viewed as an indication of diminished selling pressure as well as possible long-term accumulation by participants in the market, which may herald a significant turning point in trends.
Such a level of flows, Adler Jr. remarks, is typically an indicator of consolidation, and it may form a good base of the next altseason wave.
Previous High-Flow Peaks Marked Market Tops
By comparison, red circles on the graph indicate when the monthly average exchange flow surged at a critical level above the normal values. These are Q1 2025 and early 2024 when the altcoin flows grew to a turnover of more than $6B. Such peaks frequently coincided with local peaks in altcoin prices, which were later followed by drops when the liquidity rushed out.
Looking Ahead
The market appears to be in accumulation flows at the moment with exchange flows being subdued and now the eyes focus on the next breakout possibility. Past behavior indicates that there could be a rally in case the trend repeats, and Bitcoin continues to be relatively strong.
Right now, low altcoin traffic is one of the most obvious early signs that the market is getting ready to make another big step upwards.
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