Bitcoin (BTC) fell from a high of $108,135 on December 17 to $99,500, following hawkish comments made by US Federal Reserve Chairman Jerome Powell yesterday. However, some cryptocurrency analysts are pinning their hopes on a potential decline in Bitcoin’s (BTC.D) dominance, which could pave the way for an upswing. com. altseason.
What caused the cryptocurrency market crash?
Since yesterday, the total cryptocurrency market capitalization has fallen by more than 6%, with the bulk of the losses recorded in altcoins. In absolute terms, more than $200 billion has been wiped out of the cryptocurrency market in the past 24 hours.
Powell’s hawkish comments sent the cryptocurrency market lower, indicating that the Fed’s fight against inflation is far from over. Powell indicated that there may be only two interest rate cuts in 2025 instead of three.
In addition, the Fed raised inflation expectations for 2025 from 2.1% to 2.5%. Even the 2026 forecast is pegged at 2.1%, which is higher than the central bank’s target of 2%. The Fed sees inflation as a problem that could persist for another two years, causing interest rates to remain high for longer than initially expected.
The cryptocurrency market reacted negatively to Powell’s comments, leading to liquidations exceeding $850 million in the past 24 hours. However, some cryptocurrency analysts view the decline as an opportunity to accumulate altcoins, and expect BTC.D to decline in the coming days.
Is Bitcoin dominance about to collapse?
According to the following chart, during the weekly time frame, Bitcoin’s dominance was continuing Uptrend During the past two weeks, it increased from 56.24% to 58.50% at the time of writing. Some analysts are confident that BTC.D is forming a lower top, which may be followed by a sharp decline leading to a complete replacement season.
Bitcoin analyst Eric Crown X took to sharing what he had to say ideas On the BTC.D chart. The analyst indicated that the measure may fall to 54% after a slight rise to 59%.
Another crypto analyst @CryptoGoos male The BTC.D peak is already there. The trader added that the altcoin season will likely continue after BTC.D was rejected from resistance levels between 58% and 59%.
Likewise, Seth, a Bitcoin and stock market analyst, highlighted BTC.D’s behavior over the last two market cycles. He stated that BTC.D may follow a similar path in this cycle, consolidating at a key support level of around 58% before an eventual breakdown.
However, Arthur Hayes, former CEO of the BitMEX exchange, recently said subscriber His forecast for the cryptocurrency market, predicting a “terrible dump” ahead of the inauguration of US President-elect Donald Trump on January 20, 2025. Bitcoin is trading at $100,978 at press time, down 3% in the past 24 hours.
Featured image from Unsplash.com, charts from X and TradingView.com