Bitcoin ($BTC) dominance is being rejected from the 57.5% level. The last five weekly candles have remained below. With Bitcoin potentially starting to bottom against the U.S. dollar, could altcoins start to make their move?
Has Bitcoin Dominance topped out?
Since Bitcoin Dominance reached its low, and bottomed at around 40% through May 2021 to November 2022, dominance has been rampaging up ever since. The $BTC climb to $73,800 in a very short amount of time certainly had something to do with the number one cryptocurrency maintaining superiority over the altcoins.
The $BTC price is now attempting to find a bottom against the U.S. dollar, and should it do so, this can potentially have the effect of providing a shot in the arm to a very beaten down altcoin sector.
A fifth week of rejection for dominance
Source: TradingView
The weekly chart for Bitcoin Dominance shows the 57.5% resistance level. It’s certainly not showing that there isn’t a probability that dominance can break the resistance and go higher still, but with 5 weekly rejections now, there is the possibility that dominance can fall.
The Stochastic RSI at the bottom of the chart is also signalling downside momentum.
Altcoin market cap starting to break trend
Source: TradingView
The Total3 chart is the combined market capitalization of all the cryptocurrencies, excluding $BTC and $ETH. This is showing that the altcoin market cap is in a bull flag. There is a strong horizontal support level, which also corresponds with the 0.618 fibonacci. The market cap value already descended to this level in early August, thereby testing this level as support.
At the bottom of the chart is the Relative Strength Index, which signals oversold and overbought conditions. Given that the indicator line is below the 50 level, it is displaying an oversold state. Also, it can be seen that the indicator broke through the down trend and has now retested it. The orange line denotes a strong support and resistance level, and it can be seen that support is being found here.
Moving into the altcoins with the best potential upside
When Bitcoin does finally reverse its down trend, the best-performing altcoins are likely to run harder. Ascertaining the right ones in which to start building positions, could be the difference between moderate gains, and what could potentially be huge gains.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
