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bitcoin (btc) continues its historical price trajectory, trading in the low $90,000 range at the time of writing. However, one trading firm suggests that a drop in bitcoin (btc.D) dominance below a crucial level could signal the start of the long-awaited altcoin season.
Interest rate cuts, Trump administration will boost cryptocurrencies
In a recent Telegram broadcast, Singapore-based trading firm QCP Capital shared your analysis of the crypto market. The firm highlighted the recent performance of Solana (SOL), noting that it outperformed bitcoin and ethereum (eth) over the weekend, rising more than 17% from Friday's lows.
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Despite this, QCP Capital acknowledged that many investors remain hesitant to embrace the prospect of an imminent alt-season, given bitcoin's steady climb toward the psychologically significant $100,000 mark. The analysis of Rekt Capital supports this sentiment, suggesting that btc is just beginning its parabolic phase.
QCP Capital, however, predicted that a combination of Donald Trump's victory in the US presidential election and interest rate cuts by the Federal Reserve (Fed) could set the stage for an altcoin season in all rule in the coming months.
Trading Firm Identifies Key bitcoin Domain Threshold for Altseason
According to QCP Capital, altcoins historically outperform major cryptocurrencies once the latter consolidate after major rallies. The firm explained:
Historically, we have seen altcoins outperform whenever majors consolidate after a significant rally as gains shift towards smaller cap coins. btc dominance is around 60% now and will likely need around <58% to signal the start of the altcoin season.
Currently, btc.D stands at 60.10%. A look at the weekly chart shows that bitcoin dominance has been on a consistent uptrend since November 2022, when it was around 39.92%. During this two-year period, most altcoins have significantly underperformed bitcoin.
However, altcoins have recently shown signs of recovery, coinciding with the increasing likelihood of a pro-crypto Trump administration. Digital assets such as SOL, Cardano (ADA), and XRP have significantly outperformed btc in recent weeks.
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QCP Capital's analysis aligns with that of crypto analyst @MikybullCrypto, who predicts that btc.D will decline starting in December. According to the analyst, the high season could begin at the end of November and last until March 2025.
Some analysts believe that bitcoin may continue its recovery before showing signs of weakness. For example, Fundstrat head of research Tom Lee recently fixed that btc is on track to hit $100,000 before the end of the year.
That said, altcoin market capitalization recently arose past a key resistance level, indicating that altcoin season could be closer than expected. At press time, btc is trading at $91,760, trading unchanged in the last 24 hours.
Featured image from Unsplash, charts from x.com and Tradingview.com
