How One Line In Bitcoin Dominance Is Standing In The Way Of Alt Season

Tony "The Bull" Severino

1 year ago

3 mins read

bitcoin btc dominance btcusd crypto alt season altcoins

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Bitcoin price may have just held and confirmed a critical bullish retest of $10,000 and “meme” downtrend resistance from all-time high. After such a bullish confirmation the leading cryptocurrency by market cap could soon soar.

And if it does, BTC dominance could be signaling that altcoins are going to bleed out and into Bitcoin in the months ahead. But it all hinges on one line holding, which if lost, could send the crypto market into a full-blown alt season instead.

BTCUSD Monthly Bullish Retest Holding Strong | Source: TradingView

Bitcoin Holds Crucial Level, Will Capital Flow From Altcoins Into The Top Crypto?

The chart above paints a very clear picture: the onus is on bulls right now to hold Bitcoin price above two very important levels.

The first key level is “meme” downtrend resistance from the all-time high. This line has kept crypto prices at bay for the last three years, and in July, Bitcoin broke through it. After a monthly doji candle signaled a pause in the uptrend, the crypto asset came back down to retest and confirm the resistance line as support.

This crucial support and resistance flip could set the stage for the future of the crypto market. It could cause serious FOMO in Bitcoin, but losing it could be bad for the leading crypto asset by market cap.

A doji at the top of an uptrend is also dangerous, making the current monthly candle and the one after it that much more pivotal. A red candle falling through the second support level – $10,000 and closing a monthly below it could signal an evening star pattern, and send Bitcoin tumbling lower.

However, Bitcoin dominance could hint at the top crypto outperforming the rest of the market, which would suggest the bullish retest will hold strong.

BTC.D Monthly Former Resistance Turned Support Holding | Source: TradingView

BTC Dominance Failing To Hold S/R Flip Could Lead to Altcoin Season, Possible Takeover

BTC dominance, the metric that weighs the first-ever cryptocurrency’s market cap against the rest of the altcoin space, is also at a pivotal moment.

BTC dominance is holding strong at a level that previously acted as resistance on the way up to the bear market high of 73%. After breaking through 61% dominance, the cryptocurrency surged another 12% to that peak.

But since then, it’s been falling for over a year and counting. BTC dominance is back at 61% – the one line preventing a full-on alt season from taking place. If BTC dominance loses the line, expect fireworks in altcoins not seen since 2017.

Altcoins will not only bloom once again, but they’ll regain dominance if the lower support line can be taken out. But that target could be locked away for a very long time if BTC dominance closes its October monthly above 62%.

BTC.D Monthly Potential Morning Star Reversal Pattern | Source: TradingView

A close in September above that level could form a tweezer bottom, while a doji close here followed by a close above 62% would trigger morning star doji – a bullish reversal pattern and counterpart to the evening star formation mentioned previously related to BTCUSD.

If that happens, Bitcoin could skyrocket, leaving altcoins in its dust and putting off another alt season for a lot longer to come. Dominance has been showing signs that a bottom is in, but anything can happen in the wild world of crypto.

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.

Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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