Bitcoin Dominance: A Decline on the Way?
Updated
The market capitalization dominance of Bitcoin, measured in percentage, has continued to behave as anticipated. We've seen an increase and have now ostensibly formed a Wave ((a)), with the current phase being the formation of Wave ((b)). This Wave ((b)) is expected to reach between 100% and 138% of the previous movement. We have almost reached the 100% mark. It's important to remember that these figures don't need to be exact to the percentage point or, in the case of stocks, to the cent, but it's reasonable to expect that Bitcoin's dominance could now decrease.
As for Bitcoin, we're likely to see a five-wave downward movement. If market prices rise in the meantime, the altcoins should outperform Bitcoin, though a correction across all currencies is expected before any further upward movement. Once Wave 4 in Bitcoin's dominance concludes, we may see an increase in dominance again, indicating a shift in market dynamics.
As for Bitcoin, we're likely to see a five-wave downward movement. If market prices rise in the meantime, the altcoins should outperform Bitcoin, though a correction across all currencies is expected before any further upward movement. Once Wave 4 in Bitcoin's dominance concludes, we may see an increase in dominance again, indicating a shift in market dynamics.
Note
In the Market Cap BTC Dominance %, we're seeing exactly what we hoped to see, which satisfies us and boosts our confidence that we'll continue to see a declining Bitcoin dominance in the coming days and weeks. This could lead to stronger altcoins, unless we witness a sell-off in Bitcoin, which could also trigger a sell-off in altcoins, but that's a different matter. Focusing solely on Bitcoin dominance, we've developed Waves (i) and (ii), right at the last defense line at 78.6%. Now, we should continue to see this trend develop downwards. We are in a 5-wave structure moving down to Wave C. We should at least reach the levels that are indicated, in percentage terms, of course. We are not trading anything here; this is solely for our assessment of the overall crypto market.
Note
The journey of Bitcoin's market capitalization dominance in percentage continues to decline. Thus, we are indeed in Wave (iii) of the subordinate Wave ((c)), as anticipated. We expect a more prolonged fall from here. This could imply that altcoins might continue to perform well in the coming days, which is, of course, favorable for our positions. However, predicting the entire market's direction based on this alone is not feasible. We still need to observe Bitcoin's actions alongside these dominance metrics. Currently, it appears that Bitcoin may continue to stabilize, while its dominance decreases, leading to altcoins outperforming the market.
Note
The continued strong rise in Bitcoin has also led to an increase in Bitcoin's market capitalization dominance percentage. We are likely finishing up this very subordinate Wave (2). Ideally, we should not exceed the 78.6% level. This scenario could be invalidated if we significantly exceed the Wave ((b)) level, specifically above the 57% mark, which corresponds to the 138% level outlined with dashes. We expect to see a further decline to complete the overarching Wave 4 before Bitcoin resumes upward pressure. Thus, we might see a short-term uptick in Bitcoin dominance, followed by a subsequent decrease in dominance, potentially leading to an explosion in altcoins.
Note
Our assumptions about the Bitcoin dominance were correct, indicating we were in Wave (2). We reached the 50 to 61.8% level and saw a successful reversal there. So far, it looks like we won't be breaking above this level again, although it could still happen. Should that occur, we'll, of course, provide an update. However, we believe we are now in a subordinate Wave (3). This might be around the level of Wave (b), based on the 161.8 percent Fibonacci extension level from the overarching Wave (iii) in which we also find ourselves. We anticipate that the overarching Wave (iii) might fall further, reaching our target for Wave (5), estimated at the 227.2 to 261.8 percent extension level. Nevertheless, we continue to expect a downward trend towards the overarching Wave 4.
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