Bitcoin dominance is at 57.64 percent and has moved into a rising wedge which may signal a future drop.
The RSI shows a bearish divergence which looks similar to the signal seen before the 2021 reversal began.
Analysts say the same structure is forming again and could lead to another shift toward altcoins soon.
Bitcoin dominance has reached 57.64%, testing a long-term resistance zone while forming a rising wedge on the higher time frame chart. According to analysis published by Gert van Lagen on May 5, 2025, the setup now mirrors a structure seen in 2021. That previous instance led to a sharp reversal after a similar divergence appeared on the Relative Strength Index (RSI).
Source: X
Source: X
The RSI now presents regular bearish divergence, with price pushing higher while the indicator shows lower peaks. This behavior closely resembles the exaggerated divergence seen before Bitcoin dominance dropped sharply in 2021. The chart shows that the actual top in 2021 came only after the uptrend broke.
Van Lagen suggests the current structure may follow a comparable pattern. If history repeats, dominance could roll over soon. As Bitcoin’s share of the market peaks, alternative cryptocurrencies may begin to attract more capital and attention.
Rising Wedge Formation and Historical Echoes
Bitcoin dominance is climbing within a rising wedge, typically viewed as a bearish formation in technical analysis. Price action from previous cycles shows a similar wedge occurred between 2018 and 2021. That earlier wedge ended with a breakdown that triggered the altcoin season of that period.
The chart indicates a "1st top" followed by the "actual top" within both rising wedge phases. In the current cycle, this same labeling appears, marking a potential pattern replication. Resistance has again been found near the 0.618 Fibonacci retracement level, currently positioned around 57.64%.
This key level also marks the top boundary of a multi-year resistance zone. The red region above 57% has historically rejected Bitcoin dominance increases. Every previous attempt to break through this zone has led to downward reversals, further suggesting the market may be near a tipping point
RSI Divergence Adds to Bearish Pressure
Below the price chart, the RSI shows clear signs of regular bearish divergence. While price makes higher highs, the RSI trendline points downward. This divergence was a key signal in 2021 and appears again in 2025.
Van Lagen refers to this setup as nearly identical to what occurred in the last major cycle top. The exaggerated divergence then was followed by a steep drop in dominance and a rapid shift into altcoins. This has led some analysts to believe that altseason may be close.
On the updated chart, divergence zones are clearly marked with blue lines across both price and RSI trends. Support levels near 40% and 32% have acted as bottoms in past reversals. If dominance breaks down, traders may look to these levels as downside targets.
Will Bitcoin Dominance Crack as Altseason Approaches?
With RSI divergence, rising wedge structure, and multi-year resistance aligning, can Bitcoin dominance continue upward or is a reversal near?
As dominance reaches its third major top since 2017, conditions appear increasingly aligned with past cycle peaks. Momentum signals now point toward a slowdown in Bitcoin’s market strength. Traders are watching closely for confirmation of a trend shift toward altcoins.
