July could mark a turning point for the crypto market as altcoins trade in tight consolidation while global liquidity expands and U.S. legislation moves forward. Analyst Dan Gambardello draws parallels between current conditions and the pre-rally environment of August 2020, suggesting that the market may be on the verge of a major upward shift.

Altcoins Lag as Traditional Markets Lead

Despite the S&P 500 setting new records, cryptocurrencies—particularly altcoins—remain deeply below their all-time highs. Ethereum, for example, continues to form higher lows but trades far below its peak. This divergence has frustrated investors hoping for quick gains, but Gambardello argues this slow buildup is typical of early-stage bull markets.

The delay mirrors conditions in 2020 when monetary expansion drove equities higher before crypto followed. With altcoins showing structural strength and consolidation patterns, many believe they are preparing for a similar breakout, provided liquidity and regulatory clarity align.

Pro-Crypto Legislation and Monetary Easing Fuel Optimism

Momentum is building around the Genesis legislation and other regulatory developments in Washington, with key figures like White House crypto advisor David Sachs forecasting July as a pivotal month. Additionally, the prospect of seven rate cuts in 2026 sets a favorable macro backdrop, potentially boosting demand for digital assets.

Trump’s recent pro-Bitcoin comments have added to market sentiment, reinforcing the idea that political and financial forces may converge to benefit crypto investors in the months ahead.

Liquidity Trends Hint at Delayed But Inevitable Catch-Up

Gambardello highlights a notable disconnect between altcoin prices and the global M2 liquidity index, similar to what was observed before previous rallies. Ethereum and Cardano, among others, are trading flat or lower while liquidity rises—often a precursor to market-wide catch-up behavior. Historical cycles show crypto prices eventually follow liquidity expansion, albeit with lag.

Cardano, in particular, has shown resilience with consistent higher lows, even in bearish stretches. This suggests the altcoin market is laying the groundwork for a resurgence in the second half of 2025.

Risk Models Confirm Early Bull Market Phase

According to proprietary models, Ethereum’s risk rating is just 35: well below the 90–100 levels seen in peak markets. This signals that the altcoin bull cycle has not yet begun in earnest, offering significant upside if trends shift. These models are designed to help investors identify early entry points and plan for exit strategies as conditions evolve.

Gambardello concludes that if altcoins begin catching up with global liquidity levels, a full-fledged bull market could ignite. With multiple catalysts aligning—rising liquidity, legislation, technical patterns, and risk positioning—July may serve as the launchpad for the next major crypto expansion.

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