Altcoin Recovery Signal Ignited by Convergence of Economic Indicators

A recent analysis suggests that a combination of economic indicators and technical trends may be poised to spark a recovery in the altcoin market. According to Ash Crypto, the convergence of a MACD streak with rising PMI numbers and low CPI inflation could create an environment conducive to growth.

The MACD streak, which has been noted by analysts as a bullish signal, has not been seen since 2020. At that time, altcoins surged around 60% against Bitcoin over the following three months. Ash Crypto notes that this trend is particularly significant given the prolonged bear market, during which altcoins have underperformed.

Additionally, the PMI numbers have been trending upwards, reaching above 52 for three consecutive months. This has led some analysts to draw comparisons with previous altcoin seasons, although it is still a considerable way off from the 55 level seen in 2017 and 2021. The analyst also highlights that low CPI inflation is creating a bullish macro backdrop for risk assets.

While these signals are promising, Ash Crypto cautions against expecting an immediate full-scale altcoin season. A sustained decline in BTC dominance, broad liquidity expansion, and PMI readings above 55 would be required to trigger such an event. Nevertheless, the analyst suggests that a modest recovery could occur within the next two to three months if conditions remain favorable.