Three signals of altcoin reversal: the market is repeating the 2022 scenario
The altcoin market appears to be on the verge of a significant reversal. An analysis of the weekly chart of the TOTAL3 index, which tracks the total market capitalization of all altcoins excluding Bitcoin and Ethereum, reveals a striking structural similarity to the dynamics of late 2022. This is not just a visual coincidence—it involves the repetition of key patterns that have historically preceded a powerful bull rally.
What is happening on the TOTAL3 chart?
Altcoin capitalization is currently stuck near the $680 billion mark, significantly below the peaks of 2025. At first glance, the picture looks bleak: the price is weak, and market sentiment is rather bearish. However, a closer look at the weekly timeframe reveals a critically important detail: the RSI (Relative Strength Index) indicator is forming a higher low, while the price itself continues to move sideways or even slightly decline.
It is precisely this divergence (bullish divergence) that is the first and perhaps most important signal. In 2022, after the FTX collapse, altcoins continued to fall, and most market participants expected a new crash. However, the weekly RSI, contrary to the general panic, was quietly drawing increasingly higher lows. This "hidden strength" ultimately marked the bottom, after which a massive recovery began.
Three key reversal signals
Three clear technical indicators can be identified that suggest the bearish trend has likely exhausted itself:
1. Price holds above the panic zone. Despite the deep correction, TOTAL3 has not erased all the gains of the previous cycle. The market is weak, but it is not "dead." This indicates that large holders are not rushing to offload their positions at any price.
2. Improvement in weekly RSI dynamics. As noted, the RSI is forming a higher low. This is direct evidence that selling pressure is weakening. Even when the price looks "heavy," the downward momentum is fading. In my experience, this is exactly how a true bottom forms—not through emotional outbursts, but against the backdrop of a quiet exhaustion of bears.
3. Return of the 2022 fractal. The current chart configuration almost mirrors the situation from a year ago. Back then, such a divergence between price and RSI preceded the start of a new bullish phase. It is important to understand: this does not promise an immediate vertical surge tomorrow. But it is a powerful signal that the bearish inertia is likely already behind us.
Conclusions and outlook
The altcoin market is going through a phase that retail investors often perceive as "boring" or "broken." However, it is precisely during such moments that the foundation for future rallies is laid. Among the coins that, in our assessment, have already found a local bottom, we can highlight SEI (around $0.05), INJ (near $5), SUI (slightly below $1), ONDO (with potential to triple to $1), and TAO, confidently holding near the $200 mark.
My professional opinion: Most market participants still view the current cycle as completed, which is a classic sign of a bottom. Ignoring these technical signals would be a serious mistake. The market may not take off tomorrow, but the structural prerequisites for a new bullish trend are already in place.