Bitcoin continues to fall towards $40,000, proving that this temporary reversal wasn’t permanent. Although there are no signs of a recovery yet, this trend suggests that the cryptocurrency will face more challenges before it can recover from its current lows and reach $44K. It is getting harder and harder to find the resistance level that cryptocurrency has fought hard for.
This decline can also be seen in market dominance for the digital asset. Bitcoin continues to be under pressure from all other digital assets, despite holding a dominant share of the cryptocurrency market. Market share has decreased as altcoins are more attractive to investors looking for greater gains.
Bitcoin Market Dominance Declines
The year 2022 began with Bitcoin on a low note. This had been a tough month for bitcoin, and there were still the effects of the December crash. This had an impact on the market, as it had fallen below 40% for its first tie in six months.
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The market had suffered a quick recovery, but it wasn’t by much. The market recovery had seen it rise to 43.46% in the first week. It would not last long as altcoins again fought for dominance. Solana and Ethereum are the leaders in this space with their wide-ranging DeFi and NFT offerings.
Bitcoin’s dominance quickly dropped after that. It crashed from 43.46% at its highest point to 42.51% today.
BTC dominance drops to 42%| Source: Market Cap BTC Dominance on TradingView.com
BTC continues to dominate the market, despite its decline. This pioneer cryptocurrency remains a leader in the market and altcoins closely mirror its movement on the charts.
Losing Footing At $44K
Bitcoin is at an important price level of 44K. While it doesn’t necessarily indicate that there is a bull rally, this indicator does point to significant movement towards $45K-$46K which would be another entrance into bull markets. The asset traded at 44K yesterday but it crashed to $42,000 in the mornings on Thursday.
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The digital asset’s strength has declined as it trades below the 20-day moving mean. It signals strength for the bears, as it is now trading below the 50-day average.
If bitcoin falls below the 50-day SMA, it could lead to a decline of more than $40,000. Although bitcoin is still at a high price, it does not have enough support below that point. With major resistance rising at $44,767, the next level of support lies at $42,027.
Featured Image from MARCA chart by TradingView.com