Ethereum’s Breakout Could Spark an Altcoin Season as Liquidity Expands

Ethereum’s anticipated breakout in one to two months could ignite an altcoin rally, aligning with economic shifts and liquidity expansion

With QT ending and M2 money supply growing, increased liquidity may fuel a bullish crypto market, boosting confidence in altcoins

Historical trends mirror past bull cycles, suggesting a strong altcoin season as ETH nears a breakout and market sentiment turns bullish.

Ethereum is preparing for a breakout with analysts believing that an altcoin season will begin when ETH rallies. According to Colin Talks Crypto, ETH could take off in one to two months. This timing aligns with the expected end of quantitative tightening (QT) and the potential start of quantitative easing (QE)

Source: Colin Talks Crypto

Additionally, data from Polymarket confirms a 100% probability of QT ending before May. Economic factors, including M2 money supply growth, further support this bullish outlook. Consequently, stars are aligning for an overdue altcoin rally.

Economic Shifts Fuel Market Optimism

Besides technical patterns, economic conditions favor crypto growth. The Federal Reserve's tightening phase appears to be ending, creating room for liquidity expansion. Moreover, the Polymarket prediction market signals a strong consensus that QT will conclude before May. This shift suggests looser monetary policies, which historically boost risk assets like cryptocurrencies.

Furthermore, M2 money supply growth indicates potential liquidity injection into markets. This event often correlates with asset price surges. Hence, these factors increase confidence in an altcoin rally. Market participants now watch closely as ETH prepares for an anticipated breakout.

Historical Trends Point to a Bullish Cycle

Past market structures indicate a repeating bullish cycle. Crypto analyst el_crypto_prof highlights similarities between the 2020 and 2025 market trends. In 2020, total market capitalization broke out of a consolidation phase, leading to a parabolic rise. Similarly, in 2025, the market recently broke a descending trendline, mirroring the 2020 pattern.

Source: Moustache

Additionally, after each breakout, the market tested resistance levels as support before rallying further. This consolidation phase remains crucial in confirming bullish momentum. Moreover, both cycles show similar corrections before breaking into strong uptrends. Consequently, historical patterns support expectations of another significant market expansion.

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