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Recent cryptocurrency market dynamics in the past four days have seen bullish momentum return to many cryptocurrencies, with Bitcoin price leading the way. Interestingly, this has led to expectations of looming gains in many altcoins, and technicals indicate that altcoin season may be about to begin.
Cryptocurrency analyst Kevin (@Kev_Capital_TA) recently Draw attention to A major development for the Daily Doom crossover Bitcoin dominance. This rare event could mark a shift in cryptocurrency investments in the coming months with implications Bitcoin and the altcoin market.
Bitcoin dominance chart forms a daily death cross
According to the technical analysis of Bitcoin dominance chart, the leading cryptocurrency is about to form a death cross on the daily candlestick time frame. A death cross is a technical indicator where the short-term moving average crosses below the long-term moving average, often indicating downward momentum. The Bitcoin dominance chart, on the other hand, tracks the percentage of the total cryptocurrency market cap that Bitcoin represents, and a decline often indicates increasing strength of altcoins.
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In this case, a daily death cross is forming on the Bitcoin dominance chart at its highest level for the first time in four years, according to Kevin’s analysis. Interestingly, technical analysis shows that Bitcoin dominance has faced total rejection two different times in the past three months, a phenomenon that lends additional weight to the change in market dynamics if a death cross eventually appears.
What does this mean for cryptocurrencies?
Kevin’s analysis highlights a historical precedent where the daily death cross at an overall high preceded the start of the alternate season. Four years ago, in 2021, a similar event occurred on the Bitcoin dominance chart, preceding a shift in market momentum away from Bitcoin toward altcoins. During that period, Bitcoin’s dominance was about 63% of the total market cap. However, the following altcoin season saw Bitcoin dominance drop to less than 40% by April 2021.
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The current setup indicates that a similar scenario may emerge. If the death cross leads to a sustained decline in Bitcoin dominance, it could pave the way for an altcoin market rally.
However, Bitcoin still dominates inflows. At the time of writing, Bitcoin is trading at $99,750, with a market dominance of 55.8%. However, the last Price performance of cryptocurrencies such as XRPDogecoin and Solana appear to threaten this dominance. On the other hand, Ethereum, the king of altcoins, He hasn’t appeared yet A similar march this session.
Adding to this perspective is cryptocurrency analyst TechDev He pointed to the beginning From Altsisson. His analysis focuses on the six-month candlestick timeframe of the Bitcoin Dominance chart, where he notes that the current candlestick is the one in which altcoins will move. According to TechDev, the current candle corresponds to the historical moments when altcoins surged, noting similarities in 2017 and 2021. He explained that during these cycles, Bitcoin’s dominance declined in a new six-month candle after surpassing its all-time high in the previous cycle.
Featured image created with Dall.E, chart from Tradingview.com
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