COINTIKA.COM - Altcoin dominance recently formed a double bottom near 9%, coupled with a bullish divergence, suggesting a significant reversal after months of decline. This follows a period where Bitcoin dominance hovered above 61%, a historically overbought level often preceding major altcoin rallies. Increased trading volume alongside positive oscillator trends further supports the growing strength of the altcoin market. The current market setup mirrors previous alt-seasons, characterized by a shift in capital from Bitcoin to alternative cryptocurrencies.
The double bottom at 9% represents a key support level, with the bullish divergence—higher lows on oscillators despite lower lows in dominance—strongly indicating an impending upward trend. April and May saw stabilization and a break above short-term resistance, further strengthening this bullish outlook. Increased volume during this period suggests significant accumulation.
Conversely, Bitcoin's dominance, currently above 61%, is in overbought territory. Historically, this has signaled the beginning of altcoin seasons. The analyst points to previous instances where high Bitcoin dominance preceded significant altcoin rallies, suggesting a potential repeat of this pattern. Resistance near 63% in Bitcoin dominance could indicate a potential top, setting the stage for a pullback and increased capital flow towards altcoins.
The current market dynamics strongly resemble those preceding the 2021 alt-season, where Bitcoin dominance dropped from 73% to 40%. A similar shift could soon occur, potentially triggering a substantial altcoin rally. The confluence of technical indicators, historical patterns, and analyst predictions points to a promising outlook for altcoin investors.
