DO NOT ONLY FOCUS ON BTC PRICE
Hello everyone, I know this time is very difficult for you when BTC is losing its dominance and causing negative influences most of altcoins. I believe that you are wondering "When this reduction finishes". Today, I want to mention two important indexes, they will make you have overall picture about cryptocurrency market's fluctuation. Ok. Let's go!!!!
1. CRYPTOCURRENCY THE TOTAL MARKET CAPITALIZATION: Explaining simply, this index show us growth of cryptocurrency market (remind again whole cryptocurrency market, not BTC individual). More money flows into market, higher market capitalization. But this index does not tell us where is cash inflow going? altcoins, bitcoin or stable coin,...this is the biggest limitation of this index. That is a reason why I need second index in my analyst report.
2. BTC DOMINANCE: is defined as the ratio of Bitcoin's market capitalization to that of the rest of the cryptocurrency markets. Movement of this index indicates that whether cashflow is in BTC or not.
Two indexes get close relationship and make impact on cryptocurrency. I will give you a specific example. For period from July 2021 to Nov 2021, we have:
1. Market cap index (green trend line) nearly doubled, from 1.158T to 3.009T, a lot of money had been inputed into market.
2. Bitcoin Dominance index almost does not change, just move within blue box.
Combing two signals, traders invested many money to market but they did not buy BTC (it was proved by stable BTC dominance level). Therefore, the high probability that cash flow now is in altcoins and fact proved this analyst right. From July to Nov 2021, almost of altcoins price increased massively.
Now, back to present, let me see what we have:
1. Market cap index keeps decreasing. At current time, as my analyst, there are two situations that I drew in chart but the probability of the situation 2 happening is higher. Therefore, I will pick situation 2 for following analyst. but I also do not preclude the possibility of situation 1. If situation 1 happen, I will update immediately. Now, we should only focus on situation 2.
2. BTC Dominance index : with green candle stick last week, we have bullish engulfing pattern and furthermore it appears at local strong support (38%-40%). Therefore, BTC Dominance will continue to increase to local resistance 47%-48%.
Above analyst show as BTC is regaining its dominance by a hell of a way. BTC.D's restoration just comes from altcoins capitalization withdraw and cryptocurrency market's recession, proved by strong reduction in market cap index. That is reason why BTC.D increase but BTC price reduce. In a couple of weeks, this decline will continue and BTC price also drop to deeper bottom (29-30) as my analyst before. Only if, market cap index can stand at strong support (1.77T-184T), remarkable recovery must happen.
For any question, please leave your comments and feedbacks
1. CRYPTOCURRENCY THE TOTAL MARKET CAPITALIZATION: Explaining simply, this index show us growth of cryptocurrency market (remind again whole cryptocurrency market, not BTC individual). More money flows into market, higher market capitalization. But this index does not tell us where is cash inflow going? altcoins, bitcoin or stable coin,...this is the biggest limitation of this index. That is a reason why I need second index in my analyst report.
2. BTC DOMINANCE: is defined as the ratio of Bitcoin's market capitalization to that of the rest of the cryptocurrency markets. Movement of this index indicates that whether cashflow is in BTC or not.
Two indexes get close relationship and make impact on cryptocurrency. I will give you a specific example. For period from July 2021 to Nov 2021, we have:
1. Market cap index (green trend line) nearly doubled, from 1.158T to 3.009T, a lot of money had been inputed into market.
2. Bitcoin Dominance index almost does not change, just move within blue box.
Combing two signals, traders invested many money to market but they did not buy BTC (it was proved by stable BTC dominance level). Therefore, the high probability that cash flow now is in altcoins and fact proved this analyst right. From July to Nov 2021, almost of altcoins price increased massively.
Now, back to present, let me see what we have:
1. Market cap index keeps decreasing. At current time, as my analyst, there are two situations that I drew in chart but the probability of the situation 2 happening is higher. Therefore, I will pick situation 2 for following analyst. but I also do not preclude the possibility of situation 1. If situation 1 happen, I will update immediately. Now, we should only focus on situation 2.
2. BTC Dominance index : with green candle stick last week, we have bullish engulfing pattern and furthermore it appears at local strong support (38%-40%). Therefore, BTC Dominance will continue to increase to local resistance 47%-48%.
Above analyst show as BTC is regaining its dominance by a hell of a way. BTC.D's restoration just comes from altcoins capitalization withdraw and cryptocurrency market's recession, proved by strong reduction in market cap index. That is reason why BTC.D increase but BTC price reduce. In a couple of weeks, this decline will continue and BTC price also drop to deeper bottom (29-30) as my analyst before. Only if, market cap index can stand at strong support (1.77T-184T), remarkable recovery must happen.
For any question, please leave your comments and feedbacks
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