The Turn Begins: Breadth Thrusts, QT Ends, and Crypto’s Reversal Window
Here’s the sample data on altcoin outperformance:
1. Bitcoin’s Structural Foundation Is Taking Shape
Support, Holder Costs, and the Architecture Beneath the Market
Bitcoin (True Market Mean Support)
Alec Dejanovic highlights the True Market Mean around $82,000, which may act as a deep structural support level due to ETF cost-basis clustering. This mirrors similar consolidation zones from the prior cycle before major expansions.
Section Summary
Bitcoin appears to be stabilizing at a critical cost-basis foundation dominated by ETF flows and long-term holders. Historically, these areas have served as launchpads for large cycle advances.
2. Breadth Thrust Season Begins: A Cluster of High-Confidence Equity Signals
When Rare Market Signals Speak in Unison
S&P 500 (Whaley Breadth Thrust – In Progress)
Whaley criteria are building.
- 1-year forward returns: 100% positive
- ~23% average return
Nasdaq (7-Month Win Streak)
Seven consecutive green months for the Nasdaq have historically led to:
- 100% positive 1-year forward returns
- 23%+ average return
S&P 500 (Low Breadth + Strong Price Day)
An SPX up day of more than +1.5% with Advancers–Decliners < 100 mirrors past tech-led expansions.
- 1-year forward: 100% positive
- +4.6% average return
S&P 500 (Zweig Breadth Thrust – In Progress)
ZBT criteria must be met by December 5.
- 1-year forward: 100% positive
- ~24% average return
S&P 500 (ZBT Drawdown Behavior)
After a Zweig Breadth Thrust triggers, historical average drawdowns are only about 2%, making it a relatively low-risk signal conditionally.
S&P 500 (Whaley + Zweig Combo)
When both Whaley and Zweig fire within the same week:
- 1-year forward: 100% positive
- +28% average return
S&P 500 (6-Week Pattern)
The 6-week pattern triggered on November 21. Since 2011:
- S&P 500 1-year forward: 100% positive, +24% average
- Bitcoin 1-year forward: 86% positive, +292% average
S&P 500 (50-Day Low + NYSE Breadth Surge)
When SPX hits a 50-day low while NYSE has >70% advancers in 3 of 4 sessions:
- 1-year forward: 100% positive
- +23% average return
S&P 500 (7-Month Streak — Extended Data)
Additional data from Subu shows:
- 8-month forward: 94% positive
- +8.6% average return
S&P 500 (“Almost” Zweig Breadth Thrust)
Even near-misses of ZBT criteria historically behave similarly to true triggers:
- 1-year forward: 100% positive
- +31% average return
Section Summary
This is one of the strongest breadth thrust clusters in recent memory. Whaley, Zweig, low-breadth surges, win streaks, and the 6-week pattern all suggest equities are entering a statistically powerful upside window — historically bullish for both stocks and crypto.
3. Bitcoin Correction Exhaustion: Multi-Signal Confirmation
Funding, Holder Metrics, On-Chain Valuations, and Internal Indicators Align
Bitcoin (Funding Rates)
Funding flipped negative, a condition that typically appears near the late stages of corrections when long positioning has been washed out.
Bitcoin (Leledc Buy Signal)
A rare Leledc buy signal has appeared, last seen at deep bear market lows, historically marking strong accumulation zones
Bitcoin (MVRV Z-Score — 2 Year Rolling)
Bitcoin’s 2-year MVRV Z-Score is at the most oversold level in history, even below the bear market bottoms of 2014, 2018, and 2022.
Bitcoin (Puell Multiple)
The Puell Multiple is at discount levels similar to local bottoms in 2023, mid-2024, and early 2025, pointing to miner revenue stress and opportunity zones for long-term buyers.
Bitcoin (Open Interest Cycles)
The Altcoin Screener Bitcoin Open Interest Cycles indicator has identified every major local bottom this cycle. Open interest is currently in reset mode, suggesting a bottom formation is underway and that a rally could be coming soon.
Bitcoin (Production Cost Model)
PlanC’s Bitcoin Production Cost model, which has historically identified major lows and historic buying opportunities, currently places structural support around $70,000.
Section Summary
Bitcoin displays an extraordinary confluence of bottoming signals: negative funding, OI reset, valuation extremes (MVRV and Puell), structural production cost support, and cyclical buy triggers. This is the strongest bottom-formation alignment since mid-2023.
4. Altcoin Rotation Framework: Post-QT Catalysts
The Indicators Aligning for a December Rotation Window
Altcoins (Season Phases)
Daink’s altcoin season framework shows we remain in the Bitcoin Dominance Phase, the point in the cycle where “nobody feels rich yet” and most gains are still ahead if history rhymes.
Altcoins (Post-QT Setup — Bitcoin, Dominance, OTHERS/BTC)
Front Runners compares today’s Bitcoin, Bitcoin Dominance, and OTHERS/BTC structure to the last time the Fed ended QT. The setup is remarkably similar to the period just before major altcoin outperformance followed.
Altcoins (Alt/BTC Relative Bottom)
Wu Wei Trades highlights multiple indicators in confluence that suggest the altcoin outperformance ratio is forming a bottom, implying a favorable entry window for relative alt strength vs Bitcoin.
Altcoins (Capital Rotation + Liquidity Tailwinds)
Another thread from Wu Wei Trades lays out a thesis of capital rotation from money markets into risk assets, rising probabilities of a December rate cut, and increased high yield bond purchases. Combined with fearful, sidelined retail sentiment, this suggests improving liquidity conditions for altcoins.
Altcoins (Fed Balance Sheet vs Alt/BTC Dominance)
Matthew Hyland overlays the altcoin-to-Bitcoin dominance ratio with the Fed balance sheet around the last QT end. The historical pattern shows major altcoin outperformance starting soon after QT ends — a setup that again arrives on December 1.
Bitcoin Dominance (Downtrend Setup)
IonicXBT shares a Bitcoin Dominance chart showing structure similar to previous major downtrend pivots, which historically aligned with powerful altcoin seasons.
Section Summary
Rotation signals across dominance, alt/BTC ratios, post-QT analogs, and liquidity footprints all suggest an impending altcoin expansion window as December begins. The end of QT is the macro hinge; altcoins are poised to be the main beneficiary.
5. Macro Liquidity, Risk Appetite, and Market Structure
Why Equities Are Quietly Setting the Runway for Crypto
Russell 2000 (Risk Appetite Gauge)
Doug Funnie highlights how the Russell 2000’s current setup closely resembles its 2021 pre-breakout structure — a period that coincided with strong risk-on appetite and crypto upside.
Small Caps (Outperformance vs Gold)
Seth Golden suggests it’s likely that small cap stocks will outperform gold going forward, signaling an environment favoring growth and risk assets over defensive stores of value.
VIX (Volatility Collapse)
John notes that the VIX has fallen 40% over four sessions, a rare move that can lead to short-term S&P 500 weakness but often occurs in the context of longer-term risk-on phases.
Section Summary
Small-cap leadership, volatility compression, and high-yield interest are all pointing toward expanding liquidity and risk appetite — important macro conditions that typically support strong crypto cycles.
6. Crypto Market Structure: Parabolic Compression Signals
Fear, Volatility, and Multi-Cycle Indicators Align
Bitcoin (Monthly Bollinger Bands)
SuperBro highlights that Bitcoin’s monthly Bollinger Band structure, along with Russell 2000 all-time highs and copper/gold behavior, resembles past cycle points where parabolic crypto moves followed.
Crypto (Sentiment — Extreme Fear)
Brett shows that crypto sentiment remains in Extreme Fear. Historically, similar readings have preceded rallies — sometimes short term, sometimes the start of longer-term moves.
Section Summary
Volatility compression paired with extreme fear is a classic precursor to large expansions. These conditions don’t guarantee immediate upside, but they are almost never present at the end of a bull move.
Closing Summary
December opens with a rare alignment across multiple domains:
- Bitcoin bottom signals across MVRV, Puell, true market mean, open interest, and cyclical indicators.
- Equity breadth thrust clusters (Whaley, Zweig, win streaks, breadth surges, and the 6-week pattern) pointing to historically powerful forward returns.
- The end of QT, historically a key pivot for altcoin outperformance and dominance shifts.
- Risk appetite re-emerging via small caps, credit markets, and volatility patterns.
- Crypto market structure showing Bollinger compression and sentiment at extreme fear — conditions often found at the start of major moves, not the end.
Taken together, the data suggest we are transitioning from correction → expansion. This period may later be remembered as the quiet inflection point preceding the next major leg higher in both equities and crypto, with altcoins poised to benefit as rotation unfolds.
Indicator Summary Table
| Instrument | Indicator | Forward Returns & Insight | Source Link |
|---|---|---|---|
| Altcoins | Season Phases | Still Bitcoin season, not alt season yet | Link |
| Altcoins | Post-QT Setup | Strong move coming for altcoins | Link |
| Altcoins | Alt/BTC Relative Bottom | Strong move coming for altcoins | Link |
| Altcoins | Rotation + HY Buying | Strong move coming for altcoins | Link |
| Altcoins | Fed Balance Sheet Correlation | Strong move coming for altcoins | Link |
| Bitcoin (BTC) | True Market Mean | Potential support post-ETFs ≈ $82K | Link |
| BTC | Negative Funding | Bitcoin downside exhausted | Link |
| BTC | Leledc Buy Signal | Historically bottom signal | Link |
| BTC | MVRV Z-Score (2yr) | Most oversold ever | Link |
| BTC | Puell Multiple | Discount zone | Link |
| BTC | Open Interest Cycles | Bottom formation | Link |
| BTC | Production Cost | Support ≈ $70K | Link |
| BTC | Monthly Bollinger Bands | Parabolic precursor | Link |
| Bitcoin Dominance | Downtrend Setup | Strong move coming for altcoins | Link |
| Crypto (General) | Sentiment | Extreme Fear | Link |
| Nasdaq | 7-Month Win Streak | 1Y: 100% positive, +23% avg | Link |
| Russell 2000 | Risk Gauge | 2021-like setup | Link |
| S&P 500 (SPX) | Whaley Breadth Thrust (in progress) | 1Y: 100% positive, +23% avg | Link |
| SPX | Low Breadth + Strong Day | 1Y: 100% positive, +4.6% avg | Link |
| SPX | Zweig Breadth Thrust (in progress) | 1Y: 100% positive, +24% avg | Link |
| SPX | ZBT Drawdowns | Avg drawdown: ~2% | Link |
| SPX | Whaley + Zweig Combo (in progress) | 1Y: 100% positive, +28% avg | Link |
| SPX | 6-Week Pattern | 1Y → SPX: +24% avg , BTC: +292% avg | Link |
| SPX | 50-Day Low + NYSE Breadth | 1Y: 100% positive, +23% avg | Link |
| SPX | 7-Month Streak (Extended) | 8M: 94% positive, +8.6% avg | Link |
| SPX | Almost Zweig Thrust | 1Y: 100% positive, +31% avg | Link |
| Small Caps | Gold Rotation | Strong move coming for altcoins | Link |
| VIX | -40% in 4 Sessions | Short term pullback risk | Link |
Large Caps
For large caps, here’s the ones that stand out on a long term timeframe:
- WhiteBIT Coin
- TRON
- BNB
Bitcoin Update
Bitcoin had a relief bounce from $81,000 to $93,000. It has since gone lowered and is sitting around $86,000. It could bounce from here or revisit the lows around $81,000. If that fails to hold then the next area would be $74,000-78,000. Despite all the extreme fear in the markets lately, we are still in a bull market as long as Bitcoin is holding above $74,000.
Ethereum Update
Similar to Bitcoin, Ethereum had a rally from $2700 to $3000 but has gone a bit lower to $2800. It could revisit the lows around $2700 before going back up. If it doesn’t hold there then next area would be $2100-2400.
Solana Update
Similar to Ethereum, Solana went lower to $120 as a potential scenario called out last week. Either it goes sideways here for a bit before going higher or it could go lower to $100-110.
Solana had a recent cross above its lower Bollinger Band on the weekly timeframe. Since 2022, the returns 6 months later:
- Average = 200%
- Median = 59%
Sui Update
Not much to update here from last week. After the relief bounce from the bottom of the regression channel, Sui is going back to re-test that level again around 1.30. Either it goes sideways here for a bit before going higher. If it can’t hold above 1.35 then next level would be 1.10.
Dogecoin Update
Not much to update here either from last week. Dogecoin is hovering around $0.14. I think there’s a good chance it holds here as it’s been using this $0.14 level as support since March 2025. If this fails to hold then it will go down to $0.10-0.12.
Pepe Update
Pepe is on its last stand with a major support level. If it loses this, then it’s time to exit out of Pepe because it will likely keep going a lot lower.
Model Portfolio Update
Despite all the fear, I think this is still a good spot to add more to positions if you can stomach it. Open positions are -25%.
The overall portfolio performance considering closed positions is roughly a -19% return:
