bitcoin price has seen a significant surge since Tuesday, following the Federal Reserve’s announcement of a 50 basis point interest rate cut. This move pushed btc above the $62,000 mark, a key psychological level that has shifted investor sentiment from cautious to bullish. The breakthrough is seen as a critical turning point for the market as btc is now testing local supply levels.
As btc continues to rise, analysts are focusing on bitcoin dominance, which may be on the verge of a deep correction. A drop in bitcoin dominance could trigger a new phase of aggressive gains for altcoins. Historically, when btc dominance peaks, altcoins tend to rally as they gain market share, fueled by higher capital inflows.
Analysts are keeping an eye on signs of this trend, suggesting that a correction in bitcoin dominance could kick off a new bullish cycle for altcoins. With btc testing key resistance levels, the market could soon see a shift in momentum, opening the door for altcoins to aggressively rally and outperform btc in the near term.
bitcoin dominance peaks
Following last week’s cryptocurrency rally, altcoins surprised investors with their strong performance. Typically, when altcoins start outperforming bitcoin, speculations arise about the start of a new “altcoin season.” Analysts and investors are now closely monitoring btc dominance, which measures btc’s share of the total cryptocurrency market. Recent data suggests that btc dominance may be nearing its peak, or has already reached it.
Prominent cryptocurrency analyst Ali shared a x.com/ali_charts/status/1837986986331947251″ target=”_blank” rel=”noopener nofollow”>Technical analysis on xhighlighting the potential for a sharp drop in bitcoin dominance.
According to his analysis, btc dominance could fall to 47%, which would mark a significant shift in market dynamics. Ali believes this sets the stage for an altcoin season, when altcoins outperform btc, attracting significant capital inflows and driving explosive gains.
Historically, when btc dominance drops, it usually does so quickly, leading to substantial price increases for altcoins. The last time btc dominance dropped significantly, altcoins soared, resulting in massive gains for investors who had positioned themselves ahead of the trend.
As bitcoin continues to test critical levels, many are optimistic about a potential altcoin season, believing that the next major moves in the market could come from altcoins outperforming the flagship cryptocurrency. Investors are now preparing for what could be a lucrative period ahead.
btc Test Supply Levels
bitcoin (btc) is trading at $63,543 after five consecutive days of attempting to break above the crucial 200-day daily moving average (MA) of $63,922. If btc successfully breaks above this resistance level, it could trigger a fresh price surge towards local highs of $65,000, which would set the stage for a larger rally and a potential push towards new all-time highs.
Reclaiming the 200 daily MA and turning it into a support level would provide btc with the necessary momentum to consolidate and sustain prices above the mid-range, strengthening the bullish narrative.
However, if btc fails to reclaim the $65,000 level soon, the market could retest lower demand around $60,000. This level could act as a critical support zone and offer the bulls another chance to regain control.
Failure to hold above $60,000 could open the door for a deeper correction, which would dampen the recent bullish sentiment. Investors are closely watching bitcoin’s price action to see if it can break above these key levels and trigger the next major move.
Featured image of Dall-E, chart from TradingView
