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Home Technical analysis BTC

Bitcoin And Dollar Dominance: Five Factors Behind The Current Altcoin Season

Tony Spilotro by Tony Spilotro
2 months ago
in BTC
Reading Time: 3min read
bitcoin dominance dollar
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Bitcoin price is nearly trading at its former all-time high, and at a price point that feels unreachable for many to own a full coin, interest has again turned toward altcoins. BTC dominance has sunk as a result, and at the same time, the dollar is breaking down from support.

The scenario in the past provided the perfect storm set up for the greatest altcoin season ever. Is this incredible burst of wealth generation about to strike for a second time?

Ethereum, XRP, And Litecoin: Major Altcoins Explode As BTC Dominance And The Dollar Fall

During the month of November, Bitcoin set a higher high over its 2019 peak and surged another $5,000 beyond it. The rise up sucked capital out of altcoins, but now that full-blown FOMO has returned to crypto, profit-taking from BTC into alts is causing major altcoins to rip.

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In November alone, Ethereum, XRP, and Litecoin are all up by 50% or more. Ripple, which has been the worst-performing over three years of a bear market, skyrocketed over 100%.

Crypto is back to a bull market, and while there will be strong corrections along the way, the direction for the mid-term is likely upward.

Related Reading | Here’s Why Crypto Analysts Are Divided Over The Future Of Altcoins

Altcoins have had phases of overperformance compared to Bitcoin in the past, but what makes this time special, is due to the DXY dollar currency index dropping at the same time.

In the chart below, only one other time did BTC dominance and the DXY suffer an extended crash at the same time. The result was the 2017 crypto bubble and the greatest alt season ever. Is history about to repeat?

bitcoin dominance dollar altcoins

The total altcoin market cap soared the last time BTC dominance and the DXY fell together | Source: CRYPTOCAP-TOTAL2 on TradingView.com

Why Expensive Bitcoin And A Weakening Greenback Sparks Alt Season

Beyond the technicals and the charts of the two most dominant forces altcoins contend with via trading pairs clearly showing the same set up as the last altcoin season, there are fundamental reasons for this shift in sentiment as well.

For one, the perception of the price per Bitcoin could be working against it in favor of altcoins. Expensive BTC pushes participants toward cheaper altcoins.

Related Reading | Bizarre Correlation Between Bitcoin Dominance And The Dollar Discovered

The dollar weakening is amplifying the impact of this action and causing a massive breakout in altcoins across the board. The assets have, like Bitcoin, been in a bear market, and after four years, could be returning to a bull trend.

If that’s the truth, and the conditions are the same as last time around, another round of incredible wealth will come.

Featured image from Deposit Photos, Charts from TradingView.com
Tags: alt seasonAltcoin SeasonaltcoinsbitcoinbtcbtcusdBTCUSDTcryptodollardollar currency indexdxyusdxbtxbtusd
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Tony Spilotro

Tony Spilotro

I'm Tony Spilotro. Behind the pseudonym, I'm a digital media executive and global remote work leader with a decade of content experience and excellent. Here, I explore my newfound passions pertaining to privacy, finance, economics, politics, cryptography, property rights, and other libertarian-esque views. I am a Bitcoin evangelist, maximalist, and educator whenever I can be, helping to spread its message of freedom from government control, monetary policy mismanagement, and passing the buck - literally – to future generations. My journey from a curious retail crypto investor to a serious Bitcoin advocate, trader, and technical analyst is an unusual one, but life-changing nonetheless and has become less about money and more about a long-overdue revolution. While a firm believer in the laws governing math and science, I am profoundly fascinated by the impact of astrology and astronomy including moon and solar cycles and planetary alignment and their ability to influence and potentially predict markets. It hasn't yet clicked for me as to how to put anything to use, but I consider it my current rabbit hole I can't yet dig out of. My perspective of growing up alongside the internet, the dot com era, the Great Recession, and roots in video games collecting coins and rare items caused Bitcoin to immediately make sense to me. Through all of these lenses, I seek to produce content that is educational and entertaining, and I thank you sincerely for taking the time to read what I have to say. Please follow me on Twitter and feel free to drop me a line if you would like to work together.

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