In this episode of NewsBTC’s daily technical analysis videos, This article will examine Bitcoin’s dominance as well as the potential signs of an unexpected altcoin-season developing against a bearish backdrop.
Check out the video:
VIDEO: Bitcoin Dominance Analysis (BTC.D): September 7, 2022
For today’s video, we are going to look at Bitcoin dominance on monthly and weekly timeframes. There is potentially a notable breakdown in progress that – based on its significance – could be telling of something bigger: a possible altcoin season that no one is expecting.
Bitcoin Dominance to Submit To Altcoins
Altcoins usually perform better in bull markets. Given the current macro background, it is quite unusual for BTC.D.
BTC’s dominance continues to fall from the diagonal trend line that runs along price and on Relative Strength Index. Also, the LMACD clearly shows a battle between bears and bulls. Bitcoin versus altcoins. Altcoins lead currently.
Do you think there is an Altcoin Season?Source: TradingView.com, CRYPTOCAP.BTC.D | Source: CRYPTOCAP-BTC.D on TradingView.com
This is the Signal from The Last Alt Season.
Trend lines on Bitcoin dominance become clearer when we move to weekly time frames. Both horizontal and diagonal support are of vital importance in determining whether price will fall. The past cycle shows a similar pattern where dominance may make a lower low while the RSI makes a higher low with bullish divergence.
Bitcoin dominance was rejected by the cloud on Ichimoku weekly. It took BTC dominance to drop from 70% to 39%, where it is now.
Were we able to get another altcoin season this year?Source: TradingView.com, CRYPTOCAP.BTC.D | Source: CRYPTOCAP-BTC.D on TradingView.com
Related Reading: WATCH: Weekend At Bitcoin’s: Will The Dead Crypto Make A Comeback? BTCUSD September 2, 2022
This could be a target area for crypto market shares.
What is the best place to target in order to set new lows in Bitcoin dominance. One potential area, is yet another retest of neckline resistance turned support from the last bottom formation – an inverse head and shoulders. BTC.D. would have to be around 32% dominant.
Is 32% dominance a possible target?Source: TradingView.com, CRYPTOCAP.BTC.D | Source: CRYPTOCAP-BTC.D on TradingView.com
BTC and The Merge: How Ethereum Might Impact It
We have compared BTC.D with ETHBTC to show why we think this arrangement could work. An historical altcoin season can be driven by the Ethereum Merge.
Below is a chart that shows how Ethereum plays a significant role in the formation of Bitcoin’s dominance charts. Given that Ethereum is the 2nd largest cryptocurrency in terms of market capital, and thus has the greatest impact on the metric other than Bitcoin, this makes sense.
Source: CRYPTOCAP-BTC.D on TradingView.com| Source: CRYPTOCAP-BTC.D on TradingView.com
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Featured Image from iStockPhoto. Charts by TradingView.com