Bitcoin Dominance hits strong resistance, a market reversal signal?
The dominance rate of Bitcoin (BTC Dominance – BTC.D) has just entered an important resistance zone of 64%-76%, according to technical analysis by expert Gert van Lagen. This is also the area where BTC.D peaked in 2021, before market capitalization shifted heavily to altcoins.
An ascending wedge pattern is forming on the BTC.D chart, which is a common signal when the market is about to exhaust. If this scenario repeats, Bitcoin may gradually lose its advantage over altcoins, similar to the cycle in 2021.
Even though BTC.D has been continuously rising for nearly 3 years, this exhaustion signal is causing investors to start questioning: Is Bitcoin's dominance rally about to end, paving the way for the next 'altcoin season'?
A new cycle may break the old rules.
According to analyst Scott Melker, the current cycle is unlike previous ones. Previously, investors would often shift capital from Bitcoin to altcoins when BTC stagnated.
However, he believes that this time, new money is flowing into Bitcoin from institutions, governments, and individual investors, rather than spreading to altcoins.
"It's not possible to shift capital from ETF to meme coin," Melker remarked.
However, Titan of Crypto, a prominent analyst in the cryptocurrency field, presents a different perspective. Based on his latest analysis, the altcoin market is showing positive signs.
The chart he published indicates that the total capitalization of altcoins has broken a long-term downtrend, suggesting that the downtrend is losing steam.
In particular, the MACD indicator, a momentum assessment tool, has recorded a bullish crossover signal.
A similar signal appeared at the end of 2024, paving the way for an impressive growth phase of the altcoin market in the months that followed.
Conclusion: The cryptocurrency market is at an important crossroads, where both Bitcoin and altcoins are sending opposing signals.
While Bitcoin Dominance faces strong resistance and risks reversing, opening opportunities for altcoins, institutional money is still reinforcing Bitcoin's position.
However, with positive signs from altcoin capitalization and the MACD indicator, the 'altcoin season' may not be far off.
Investors need to carefully consider, based on technical analysis and cash flow trends, to make the right decision in this volatile market context.