retail is shifting from btc to altcoins and it might signal bitcoin buyer exhaustion

been watching some interesting data this week. retail sentiment toward crypto jumped hard but it's not going into bitcoin anymore. analysts think this could mean btc buyers are getting tired.

the numbers are pretty clear

crypto sentiment index went from 0.23 to 0.91 in just one week according to bitwise's max shannon. that's a massive jump but here's the interesting part - google searches for altcoins and ethereum hit multiyear highs.

this pattern looks similar to what we saw before previous bear markets. people start looking for alternatives after bitcoin runs up, which usually means the btc party might be ending soon.

bitcoin hit some turbulence

btc dropped below $118k on thursday after treasury secretary scott bessent said the government had no plans to buy more bitcoin for the strategic reserve. he walked that back pretty quick though, saying they're still exploring ways to add btc.

fear and greed index dropped from 68 to 59, moving out of greed territory into neutral. still elevated but not euphoric anymore.

what buyer exhaustion actually means

when buying pressure starts decreasing while selling pressure stays the same, you get buyer exhaustion. basically fewer people want to buy at these high prices so capital starts rotating into other assets.

we're seeing this with retail interest shifting toward altcoins and ethereum. classic pattern that often happens after bitcoin makes new highs.

september altcoin season incoming

coinbase institutional's david duong thinks we're setting up for full altcoin season as we approach september. altcoin season means at least 75% of the top 50 altcoins outperform bitcoin over 90 days.

the altcoin season index climbed from 33 to 42 this week but still needs to hit 75 to officially trigger altseason.

michaël van de poppe from mn trading thinks altcoins could see 100-150% gains in their first serious run, similar to what ethereum just did.

what this means for traders

if bitcoin buyers are actually exhausted, we might see:

btc consolidation or pullback in the near term

capital rotating into ethereum and altcoins

potential altcoin season starting in september

bitcoin possibly finding support and resuming later

the broader crypto narrative is still intact with things like solana etf decisions coming in october. policy developments remain favorable.

but short term, retail attention shifting away from bitcoin toward alts is usually a sign that btc's current run might need to take a breather.

not saying bitcoin is done, just that the easy money phase might be over for now while altcoins get their turn.