Bitcoin price is struggling to break through resistance at $50,000, and it could partially be altcoins to blame for the weakness. The most recent technical structure on the highest time frames suggests that not only could alts continue to gain against BTC dominance, altcoin season itself could last a while longer.
Bitcoin Dominance And Technical Analysis Using The MetricTechnical analysis is a subjective art. The practice has enough naysayers as is, but even those that subscribe to the study don’t always believe that all charts are created equally.
For example, there are several industry vets that do not believe BTC dominance – a metric that weighs Bitcoin against the rest of the crypto space in terms of market share – has value as part of crypto analysis.
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If Ethereum outperforms Bitcoin, for example, dominance might dip as a result. The magnitude of this is enhanced further due to the sheer volume of unique altcoins that exist today. Some even argue that the metric itself was once useful, but less so due to dominance not including the vast world of NFTs or the constant sea of new DeFi projects springing up.
For those that are believers, the recent altcoin season could have been predicted with some degree of accuracy. And if the metric continues to hold weight, altcoin season might have another few months left.
Could altcoins beat Bitcoin at its own game a while longer? | Source: CRYPTOCAP-BTC.D on TradingView.com Why Altcoins Season Could Last Several Months LongerBTC dominance has established a massive trading range between 70% and 38% dominance. While altcoin sentiment was at its worst compared to Bitcoin, the range failed to break to the upside, resulting in a swing to the lower boundary of the trading range.
BTC.D stopped short of touching the previous bottom, but is following a pattern from the last cycle that suggests not only will the lower boundary be touched, lows will be swept and perhaps a new range reached.
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Technicals also support a fall into the bear zone – or oversold levels – on the Relative Strength Index. The total crypto market cap has also reentered the bull zone on the RSI, all while Bitcoin struggles with resistance.
The LMACD is still fully red on the histogram and not nearly at the depths, lengths, or oversold levels as the last market cycle. All of the signals combined suggest that altcoins are likely to outperform Bitcoin for another few months.
A monthly candle close below the trading range highlighted in the chart above might be the exit signal that altcoin season is over, and putting any crypto capital back into BTC might become the more profitable venture again. Before it happens, there could be extreme volatility on the dominance chart in a battle that’s brewing between Bitcoin and altcoins.
Follow @TonySpilotroBTC on Twitter or via the TonyTradesBTC Telegram. Content is educational and should not be considered investment advice.
Featured image from iStockPhoto, Charts from TradingView.comfrom NewsBTC https://ift.tt/3DxVUav
